The national asset monetisation Pipeline (NMP) programme announced in the Union Budget 2021-22 is detailed in a document released to the public on August 23 by NITI Aayog, the Union government’s think tank (established in 2014 by the BJP/NDA government to replace the Soviet-style Planning Commission). Under this initiative, leases of several public sector ‘brownfield’, i.e, functional, infrastructure assets including public highways, railways, shipping, aviation, power, telecom, oil and gas industries and warehousing units, will be auctioned to private sector companies. In turn, the lessees will manage them for the contracted period of time retaining profits earned during the lease period. Over the next four years, the Union government expects to raise Rs.6 lakh crore from private corporations and companies by leasing brownfield assets to fund greenfield infrastructure projects.

On paper, the NMP programme is a promising win-win initiative. However, the proposed auctions of government managed infrastructure projects are unlikely to arouse much interest. That’s because public-private partnerships have a bad history of government bullying, variation of contractual terms and lack of respect for sanctity of contract.

Indeed there’s no shortage of case histories demonstrating that governments at the Centre and in the states have ill-concealed contempt for citizens and corporations, and take full advantage of the dysfunctional and time-agnostic judicial system to routinely renege on their contractual obligations.

Private individuals, corporates and NGOs are often seduced by tall promises and honeyed words to sign PPPs (public-private partnerships). But in most PPPs, the role of private partners is expeditiously reduced to providing funding while management of joint ventures is usurped by overweening and usually under-qualified bureaucrats and/or their nominees. This lack of trust in government was recently manifested in the abject failure of an Indian Railways proposal to lease railway tracks to private enterprises for running private trains.

This initiative was widely welcomed by industry (and EducationWorld) because it offered the prospect of superior, globally benchmarked passenger and goods rail services to the citizenry, and competition to the antiquated public sector Indian Railways. However, the terms of the track leasing agreement which IR proposed were one-sided and discretionary power of railway officials to vary the terms of contracts “in the public interest” was unacceptably wide.

For similar reasons, the NMP programme is likely to prove a damp squib. Since 1991, successive governments elected to office at the Centre and in the states have promised full privatisation of bleeding public sector enterprises which are a major drag on the economy. The half-way house NMP programme under which government wants to continue to “preserve national assets” is likely to prove another red herring.