A debate on the monetisation of unutilised and under-utilised government and public sector assets has started with the introduction of a roadmap for monetisation in the Union budget.
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The debate got momentum with a speech made by Prime Minister in a webinar conducted by the Department of Investment and Public Asset Management. The Prime Minister is of the opinion that there is no need for the government to be in the business of business.
In the budget, the government proposed to launch a âNational Monetisation Pipelineâ to assess the potential value of underutilised and unused government assets. To keep the whole process transparent, an asset monetisation dashboard will be created to track the progress and provide visibility to investors.
Monetisation of assets is not a new concept. A number of countries including the United States, Australia, Canada, France and China have effectively utilised this policy. In India too, the concept was suggested by a committee led by Vijay Kelkar on the roadmap for fiscal consolidation in 2012. The committee had suggested that the government start monetisation as a key instrument to raise resources for development. It asked the government to use these resources for financing infrastructure needs.
Why Monetisation:
The global pandemic impacts the economy and turns it into an economic crisis. It forced the government to increase spending to provide essential relief to vulnerable sections of the society. Thus, total expenditure of the government has jumped to âč34.50 trillion against the target of âč30.42 trillion. On the flip side, revenue of the government is shrinking. The result: a huge rise in borrowing. As yet, total borrowing has increased by 2.3 times, from âč7.96 trillion to âč18.49 trillion.
An increase in the borrowing also increases interest cost. The ratio of interest payment to revenue receipts was 36.3% in 2019-20. As per revised data, it has increased to 44.5% in the current fiscal year and is projected at an all-time high of 45.3% in 2021-22. Almost half of the revenue is going towards servicing old debts. To revive the economy, capital expenditure is indispensable.
In this backdrop, the government has already launched the National Infrastructure Pipeline (NIP), with 6,835 projects in December 2019. The project pipeline has been increased to 7,400. The NIP has its own specific target and the government is committed to achieve it in the coming years.
It called for a major increase in funding. Therefore, the government has increased capital expenditure to âč4.39 trillion as against the budget target of âč4.12 trillion in 2020-21. For 2021-22, the government has proposed to spend âč5.54 trillion, which is 34.5% higher than the budgeted amount of 2020-21.
Now, the government found that monetisation of government- and public sector-owned assets would be an important financing option for new infrastructure construction. It is looking to monetise physical assets namely land, building, road, railway stations, immovable enemy properties etc.
Model for monetisation of assets:
The success of monetisation will depend upon the model of monetisation opted and the effectiveness with which it is executed. The government is looking at the Real Estate Investment Trusts (REITs) model for monetisation of assets.
Under REITs, the land assets are transferred to a trust providing investment opportunity for institutional investors. The National Highways Authority of India and Power Grid Corporation of India have been asked to sponsor one infrastructure investment trust to attract Development Finance Institutions and Foreign Institutional Investors.
The government has another option to lease or rent out the assets instead of going for monetisation. The first option may yield a stream of periodic income as non-tax revenue. But the government has opted for another option, which is monetisation, and it will generate one-time non-debt capital receipts.
The government expects monetisation will generate âč2.5 trillion in non-debt capital revenue. The objective of asset monetisation is to raise resources for future investment into the sector. The Prime Minister has already stated that the amount garnered from monetisation will be put to public use.
A pipeline monetisation plan for Indian Oil, GAIL, and Hindustan Petroleum has been drawn up by the government. It is expected that the government will raise âč0.17 trillion by selling stakes in these three companies.
To handle effectively the task of monetisation of assets, the government should constitute an independent commission clothed with requisite powers and staffed by professionals and researchers to formulate and implement its monetisation initiative.
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The United Nations has shaped so much of global co-operation and regulation that we wouldnât recognise our world today without the UNâs pervasive role in it. So many small details of our lives â such as postage and copyright laws â are subject to international co-operation nurtured by the UN.
In its 75th year, however, the UN is in a difficult moment as the world faces climate crisis, a global pandemic, great power competition, trade wars, economic depression and a wider breakdown in international co-operation.

Still, the UN has faced tough times before â over many decades during the Cold War, the Security Council was crippled by deep tensions between the US and the Soviet Union. The UN is not as sidelined or divided today as it was then. However, as the relationship between China and the US sours, the achievements of global co-operation are being eroded.
The way in which people speak about the UN often implies a level of coherence and bureaucratic independence that the UN rarely possesses. A failure of the UN is normally better understood as a failure of international co-operation.
We see this recently in the UNâs inability to deal with crises from the ethnic cleansing of the Rohingya Muslims in Myanmar, to civil conflict in Syria, and the failure of the Security Council to adopt a COVID-19 resolution calling for ceasefires in conflict zones and a co-operative international response to the pandemic.
The UN administration is not primarily to blame for these failures; rather, the problem is the great powers â in the case of COVID-19, China and the US â refusing to co-operate.
Where states fail to agree, the UN is powerless to act.
Marking the 75th anniversary of the official formation of the UN, when 50 founding nations signed the UN Charter on June 26, 1945, we look at some of its key triumphs and resounding failures.
Five successes
1. Peacekeeping
The United Nations was created with the goal of being a collective security organisation. The UN Charter establishes that the use of force is only lawful either in self-defence or if authorised by the UN Security Council. The Security Councilâs five permanent members, being China, US, UK, Russia and France, can veto any such resolution.
The UNâs consistent role in seeking to manage conflict is one of its greatest successes.
A key component of this role is peacekeeping. The UN under its second secretary-general, the Swedish statesman Dag Hammarskjöld â who was posthumously awarded the Nobel Peace prize after he died in a suspicious plane crash â created the concept of peacekeeping. Hammarskjöld was responding to the 1956 Suez Crisis, in which the US opposed the invasion of Egypt by its allies Israel, France and the UK.
UN peacekeeping missions involve the use of impartial and armed UN forces, drawn from member states, to stabilise fragile situations. “The essence of peacekeeping is the use of soldiers as a catalyst for peace rather than as the instruments of war,â said then UN Secretary-General Javier PĂ©rez de CuĂ©llar, when the forces won the 1988 Nobel Peace Prize following missions in conflict zones in the Middle East, Africa, Asia, Central America and Europe.
However, peacekeeping also counts among the UNâs major failures.
2. Law of the Sea
Negotiated between 1973 and 1982, the UN Convention on the Law of the Sea (UNCLOS) set up the current international law of the seas. It defines statesâ rights and creates concepts such as exclusive economic zones, as well as procedures for the settling of disputes, new arrangements for governing deep sea bed mining, and importantly, new provisions for the protection of marine resources and ocean conservation.
Mostly, countries have abided by the convention. There are various disputes that China has over the East and South China Seas which present a conflict between power and law, in that although UNCLOS creates mechanisms for resolving disputes, a powerful state isnât necessarily going to submit to those mechanisms.
Secondly, on the conservation front, although UNCLOS is a huge step forward, it has failed to adequately protect oceans that are outside any stateâs control. Ocean ecosystems have been dramatically transformed through overfishing. This is an ecological catastrophe that UNCLOS has slowed, but failed to address comprehensively.
3. Decolonisation
The idea of racial equality and of a peopleâs right to self-determination was discussed in the wake of World War I and rejected. After World War II, however, those principles were endorsed within the UN system, and the Trusteeship Council, which monitored the process of decolonisation, was one of the initial bodies of the UN.
Although many national independence movements only won liberation through bloody conflicts, the UN has overseen a process of decolonisation that has transformed international politics. In 1945, around one third of the worldâs population lived under colonial rule. Today, there are less than 2 million people living in colonies.
When it comes to the worldâs First Nations, however, the UN generally has done little to address their concerns, aside from the non-binding UN Declaration on the Rights of Indigenous Peoples of 2007.
4. Human rights
The Human Rights Declaration of 1948 for the first time set out fundamental human rights to be universally protected, recognising that the âinherent dignity and of the equal and inalienable rights of all members of the human family is the foundation of freedom, justice and peace in the worldâ.
Since 1948, 10 human rights treaties have been adopted â including conventions on the rights of children and migrant workers, and against torture and discrimination based on gender and race â each monitored by its own committee of independent experts.
The language of human rights has created a new framework for thinking about the relationship between the individual, the state and the international system. Although some people would prefer that political movements focus on âliberationâ rather than ârightsâ, the idea of human rights has made the individual person a focus of national and international attention.
5. Free trade
Depending on your politics, you might view the World Trade Organisation as a huge success, or a huge failure.
The WTO creates a near-binding system of international trade law with a clear and efficient dispute resolution process.
The majority Australian consensus is that the WTO is a success because it has been good for Australian famers especially, through its winding back of subsidies and tariffs.
However, the WTO enabled an era of globalisation which is now politically controversial.
Recently, the US has sought to disrupt the system. In addition to the trade war with China, the Trump Administration has also refused to appoint tribunal members to the WTOâs Appellate Body, so it has crippled the dispute resolution process. Of course, the Trump Administration is not the first to take issue with Chinaâs trade strategies, which include subsidises for âState Owned Enterprisesâ and demands that foreign firms transfer intellectual property in exchange for market access.
The existence of the UN has created a forum where nations can discuss new problems, and climate change is one of them. The Intergovernmental Panel on Climate Change (IPCC) was set up in 1988 to assess climate science and provide policymakers with assessments and options. In 1992, the UN Framework Convention on Climate Change created a permanent forum for negotiations.
However, despite an international scientific body in the IPCC, and 165 signatory nations to the climate treaty, global greenhouse gas emissions have continued to increase.
Under the Paris Agreement, even if every country meets its greenhouse gas emission targets we are still on track for âdangerous warmingâ. Yet, no major country is even on track to meet its targets; while emissions will probably decline this year as a result of COVID-19, atmospheric concentrations of greenhouse gases will still increase.
This illustrates a core conundrum of the UN in that it opens the possibility of global cooperation, but is unable to constrain states from pursuing their narrowly conceived self-interests. Deep co-operation remains challenging.
Five failures of the UN
1. Peacekeeping
During the Bosnian War, Dutch peacekeeping forces stationed in the town of Srebrenica, declared a âsafe areaâ by the UN in 1993, failed in 1995 to stop the massacre of more than 8000 Muslim men and boys by Bosnian Serb forces. This is one of the most widely discussed examples of the failures of international peacekeeping operations.
On the massacreâs 10th anniversary, then UN Secretary General Kofi Annan wrote that the UN had âmade serious errors of judgement, rooted in a philosophy of impartialityâ, contributing to a mass murder that would âhaunt our history foreverâ.
If you look at some of the other infamous failures of peacekeeping missions â in places such as Rwanda, Somalia and Angola â Âit is the limited powers given to peacekeeping operations that have resulted in those failures.
2. The invasion of Iraq
The invasion of Iraq by the US in 2003, which was unlawful and without Security Council authorisation, reflects the fact that the UN is has very limited capacity to constrain the actions of great powers.
The Security Council designers created the veto power so that any of the five permanent members could reject a Council resolution, so in that way it is programmed to fail when a great power really wants to do something that the international community generally condemns.
In the case of the Iraq invasion, the US didnât veto a resolution, but rather sought authorisation that it did not get. The UN, if you go by the idea of collective security, should have responded by defending Iraq against this unlawful use of force.
The invasion proved a humanitarian disaster with the loss of more than 400,000 lives, and many believe that it led to the emergence of the terrorist Islamic State.
3. Refugee crises
The UN brokered the 1951 Refugee Convention to address the plight of people displaced in Europe due to World War II; years later, the 1967 Protocol removed time and geographical restrictions so that the Convention can now apply universally (although many countries in Asia have refused to sign it, owing in part to its Eurocentric origins).
Despite these treaties, and the work of the UN High Commission for Refugees, there is somewhere between 30 and 40 million refugees, many of them, such as many Palestinians, living for decades outside their homelands. This is in addition to more than 40 million people displaced within their own countries.
While for a long time refugee numbers were reducing, in recent years, particularly driven by the Syrian conflict, there have been increases in the number of people being displaced.
During the COVID-19 crisis, boatloads of Rohingya refugees were turned away by port after port.  This tragedy has echoes of pre-World War II when ships of Jewish refugees fleeing Nazi Germany were refused entry by multiple countries.
And as a catastrophe of a different kind looms, there is no international framework in place for responding to people who will be displaced by rising seas and other effects of climate change.
4. Conflicts without end
Across the world, there is a shopping list of unresolved civil conflicts and disputed territories.
Palestine and Kashmir are two of the longest-running failures of the UN to resolve disputed lands. More recent, ongoing conflicts include the civil wars in Syria and Yemen.
The common denominator of unresolved conflicts is either division among the great powers, or a lack of international interest due to the geopolitical stakes not being sufficiently high.  For instance, the inaction during the Rwandan civil war in the 1990s was not due to a division among great powers, but rather a lack of political will to engage.
In Syria, by contrast, Russia and the US have opposing interests and back opposing sides: Russia backs the government of the Syrian dictator Bashar al-Assad, whereas the US does not.
5. Acting like itâs 1945
The UN is increasingly out of step with the reality of geopolitics today.
The permanent members of the Security Council reflect the division of power internationally at the end of World War II. The continuing exclusion of Germany, Japan, and rising powers such as India and Indonesia, reflects the failure to reflect the changing balance of power.
Also, bodies such as the IMF and the World Bank, which are part of the UN system, continue to be dominated by the West. In response, China has created potential rival institutions such as the Asian Infrastructure Investment Bank.
Western domination of UN institutions undermines their credibility. However, a more fundamental problem is that institutions designed in 1945 are a poor fit with the systemic global challenges â of which climate change is foremost â  that we face today.