The Indian government has taken another step towards reducing the financial burden on Mahanagar Telephone Nigam Limited (MTNL), with an inter-ministerial panel recommending the monetisation of surplus land and building assets worth approximately ₹1,100 crore. The proposal is part of the government’s broader strategy to unlock value from underutilised public-sector assets and generate funds that can help address the telecom company’s mounting liabilities.
The recommendation was made on November 5, 2026, and will now be submitted to a Cabinet-delegated Alternative Mechanism for approval. The National Land Monetization Corporation (NLMC), a government-owned entity under the Ministry of Finance, is expected to oversee the process. The proposed sale is not yet completed, and potential buyers will be identified only after the necessary government clearances.
Government Panel Recommends MTNL Asset Monetisation
The Inter-Ministerial Group (IMG) responsible for reviewing public-sector asset monetisation proposals recommended the latest transaction following a meeting chaired by Department of Public Enterprises Secretary K. Moses Chalai and co-chaired by Department of Telecommunications Secretary Amit Agrawal.
The Finance Ministry confirmed that the recommendations primarily involve surplus land and building assets belonging to Central Public Sector Enterprises (CPSEs). Business Standard reported that the assets valued at approximately ₹1,100 crore belong to MTNL, citing an official familiar with the matter.
The proposal will now move to the Cabinet-delegated Alternative Mechanism, which includes the Union Finance Minister, the Minister of Road Transport and Highways and the minister responsible for the concerned administrative ministry.
The approval process is important because the inter-ministerial panel’s recommendation does not itself authorise an immediate sale.
| Transaction detail | Status |
|---|---|
| Asset value | Approximately ₹1,100 crore |
| Asset category | Surplus land and buildings |
| Asset owner | MTNL |
| Recommending authority | Inter-Ministerial Group |
| Monetisation agency | National Land Monetization Corporation |
| Final approval | Cabinet-delegated Alternative Mechanism |
| Current status | Awaiting approval |
Once the proposal receives the required clearances, NLMC will begin the next stages of asset monetisation.
How Will MTNL’s Properties Be Sold?
The government plans to use NLMC to manage the monetisation process, including asset assessment, due diligence, valuation, transaction structuring and identification of potential buyers.
The sale process will depend partly on whether a government institution is interested in purchasing the identified properties.
According to the reported procedure:
- If a government entity expresses interest, the transaction may be completed through private placement.
- If there is no government buyer, NLMC may conduct an auction to attract private-sector buyers.
- Asset valuation and reserve prices will be determined through the prescribed government process.
- Final monetisation will proceed after the necessary approvals.
This approach is intended to improve price discovery and ensure that surplus government properties are sold through a structured process.
The government established NLMC in 2022 to facilitate the monetisation of surplus land and non-core assets belonging to CPSEs and other government organisations.
MTNL’s Debt Burden Has Reached Around ₹40,000 Crore
The proposed asset sale comes as MTNL continues to face serious financial difficulties.
The company’s liabilities climbed to approximately ₹40,000 crore during FY26, according to Business Standard. It has also defaulted on loan repayments to several public-sector banks.
The lenders include:
- State Bank of India
- Punjab National Bank
- Bank of India
- Indian Overseas Bank
- Union Bank of India
- Punjab & Sind Bank
- UCO Bank
These defaults have made debt management an important part of the government’s efforts to restructure the state-owned telecom operator.
MTNL’s financial performance also reflects the scale of its challenges. The company reported a net loss of ₹3,102 crore in FY26 against total income of ₹1,469 crore.
| Financial indicator | FY26 |
|---|---|
| Total income | ₹1,469 crore |
| Net loss | ₹3,102 crore |
| Reported liabilities | Around ₹40,000 crore |
| Proceeds from two property sales | ₹419 crore |
The company’s financial difficulties are connected to its declining telecom business, high operating costs, debt-servicing obligations and competition from private telecom operators.
Unlike private telecom companies that have expanded their nationwide mobile and broadband operations, MTNL primarily serves customers in Delhi and Mumbai.
MTNL Already Raised ₹419 Crore Through Property Sales
The proposed ₹1,100-crore monetisation is not the company’s first attempt to generate funds through property transactions.
MTNL raised ₹419 crore during FY26 by selling two properties in Mumbai and New Delhi.
One property was sold to the National Bank for Agriculture and Rural Development (NABARD), while the other was sold to the Bihar government.
The latest proposal would expand these efforts by bringing additional surplus land and buildings into the monetisation process.
However, the ₹1,100-crore figure represents the value of assets proposed for monetisation, not confirmed cash proceeds. The final amount realised will depend on valuation, buyer interest, transaction conditions and the approval process.
Even if the entire estimated amount is realised, it would represent only a portion of MTNL’s overall liabilities.
The company will therefore need broader financial and operational measures alongside asset sales to address its long-term financial position.
What Is the National Land Monetization Corporation?
The National Land Monetization Corporation is a wholly owned government company operating under the Department of Public Enterprises in the Ministry of Finance.
It was established following the Union Budget 2021-22 announcement to unlock the value of surplus land and non-core assets held by government-owned enterprises.
Its responsibilities include:
- Identifying surplus government-owned properties.
- Conducting asset assessments and due diligence.
- Coordinating property valuation.
- Structuring monetisation transactions.
- Facilitating competitive bidding and sales.
- Supporting government entities in unlocking value from underutilised assets.
NLMC is also involved in the broader government asset monetisation programme beyond MTNL.
Business Standard reported that the corporation had mobilised approximately ₹9,000 crore during the current financial year by November 2026, against a target of up to ₹15,000 crore. Its wider asset pipeline was estimated at ₹5,000-6,000 crore.
These figures relate to NLMC’s broader programme and should not be confused with the proposed MTNL asset sale.
How Asset Monetisation Fits Into the MTNL-BSNL Revival Strategy
MTNL’s financial restructuring is part of the government’s wider effort to support state-owned telecom companies, including Bharat Sanchar Nigam Limited (BSNL).
The Union Cabinet approved a revival package for BSNL and MTNL in 2019, which included spectrum allocation, sovereign-guaranteed bonds, voluntary retirement measures and asset monetisation.
The government also approved an in-principle merger of the two companies. Subsequently, an operational arrangement between MTNL and BSNL came into effect from January 1, 2025.
Under this arrangement, BSNL has taken on operational responsibilities for MTNL’s telecom services, while the two companies remain separate legal entities.
Asset monetisation is intended to help generate resources for debt repayment and other financial obligations.
However, selling non-core properties does not directly resolve the underlying operational challenges facing MTNL. The company still needs to manage its existing liabilities and improve the sustainability of its telecom operations.
The Bigger Picture
The proposed MTNL asset sale highlights the government’s continuing effort to use surplus public-sector properties to address financial stress in state-owned enterprises.
For MTNL, monetising land and buildings could provide additional funds to meet debt obligations and reduce pressure from lenders. For the government, the exercise is part of a larger strategy to make underutilised public assets economically productive.
However, the scale of the company’s liabilities means that the proposed ₹1,100-crore transaction alone cannot resolve its financial difficulties. The outcome will depend on the final sale value, the use of proceeds and the effectiveness of the broader restructuring programme.
Looking Ahead
The immediate next step is approval from the Cabinet-delegated Alternative Mechanism. Once clearance is received, NLMC can begin identifying buyers and proceeding with the prescribed monetisation process. The timing and final proceeds will depend on the valuation and sale of the identified properties.
For MTNL, the larger challenge remains reducing its debt burden while maintaining telecom services through its operational arrangement with BSNL. The proposed property sale could provide some financial relief, but sustainable recovery will require a combination of debt management, asset monetisation and operational improvements.
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