mumbai/new delhi, May 2 -- The government is exploring partnerships with real estate-focused global investors to form real estate investment trusts (Reits) that will house optic fibre networks and land assets of central public sector enterprises (CPSEs), multiple people with knowledge of the matter said. The assets under consideration could also be repurposed for data centre infrastructure, potentially widening investor appeal. The plan, still at an early stage, is part of a broader push to accelerate government asset monetization following the Union budget for 2026-27, which proposed using Reit structures to recycle state-owned assets and attract institutional capital. Reits allow asset owners, in this case the government, to convert infrastructure into tradable securities, unlocking capital while retaining ownership of the underlying assets as a sponsor, generating income through long-term leases. "The discussions are still early, and there's no official mandate yet. But monetizing optic fiber networks of these companies and their surrounding infrastructure remains the lowest hanging fruit for a divestment strategy," one of the people cited above said, requesting anonymity. The trusts are expected to hold assets from companies like Bharat Sanchar Nigam Ltd, RailTel Corp. of India Ltd, and Power Grid Corp. of India Ltd, the person said. These entities operate extensive fibre networks and, in some cases, control land parcels that could be monetized under existing guidelines. Some of global investors with real estate muscle include Blackstone Inc. and Brookfield Corp., both of which operate large-scale data centre platforms in India and are among the most active investors in the country's Reit ecosystem. Emailed queries sent to the finance ministry, Blackstone, Brookfield, BSNL and PowerGrid remained unanswered until press time. A RailTel spokesperson said the company does not have any existing land bank that can be earmarked for monetization under the Reit framework proposed by the ministry of finance. "Officials are identifying assets, and companies can be added or dropped from the plan based on a feasibility test at a later stage," a second person said. "The scope of the plan can even expand to utilize the assets for establishing specialized data centre trusts, which will sweeten the deal for any incoming private equity investor." Such public-private partnership structures are not new in India, where infrastructure assets have previously been monetized through Reit and Infrastructure investment trust (InvIT) frameworks to attract institutional capital. PowerGrid and RailTel operate optic fiber infrastructure across the country and lease bandwidth to telecom operators. PowerGrid also has regulatory approval from the Central Electricity Regulatory Commission to establish data centres on surplus substation land. BSNL, meanwhile, controls land parcels across tier-one and tier-two cities, monetization of which is already underway under guidelines set by the Department of Investment and Public Asset Management, under the finance ministry. An asset manager at a domestic real estate investment firm said the proposed data centre trusts involving the government and private equity players could face distinct structural complexities. "Executing transactions for dropping data centre assets into Reits will require unbundling optical fiber networks from core telecom and transmission operations, executing land title transfers across varied municipal jurisdictions, and structuring lease agreements that satisfy national data security and localization regulations," the asset manager said. "Institutional investors willing to get involved will look to standardize these models before supplying any upfront capital expenditure required to scale server capacity." In April, Blackstone-owned data centre firm AirTrunk acquired Blackstone-backed Lumina CloudInfra in India, which develops large-scale data centres. Late last year, Brookfield, in partnership with Reliance Industries Ltd and Digital Realty, announced an $11-billion investment over five years to build a 1 GW data centre in Visakhapatnam, Andhra Pradesh....