The Union Cabinet chaired by Prime Minister Narendra Modi has sanctioned its approval to the National Highways Authority of India (NHAI) for setting up Infrastructure Investment Trust (InvIT) as per InvIT Guidelines issued by Securities and Exchange Board of India (SEBI).
This will enable NHAI to monetise completed national highways that have a toll collection track record of at least one year, and NHAI reserves the right to levy toll on the identified highway. InvIT as an instrument provides greater flexibility to investors.
InvIT is expected to generate specialised O&M concessionaires, attract patient capital to the Indian highway market, as these investors are averse to construction risk and interested in investment in assets which provide long-term stable returns. It will also help in retail domestic savings and corpus of special institutions (such as mutual funds, PFRDA, etc) to be invested in the infrastructure sector through InvIT.
NHAI's InvIT will be a Trust established by NHAI under the Indian Trust Act, 1882 and the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations 2014.