Following the successful launch of the NHAI’s first infrastructure investment trust (InvIT) with foreign institutional investors, the Indian government is working on a proposal to introduce a new InvIT dedicated to national highways.
The process for establishing this public InvIT will require the creation of five key entities, as mandated by the Securities and Exchange Board of India (Sebi) regulations: the sponsor, investment manager, project special purpose vehicle, project management company and trust.
Initially, the plan was to open the existing InvIT to the public. However, due to Sebi regulations, which have made this process more complex, NHAI has opted to create a fresh trust with distinct trustees, project managers, investment managers, etc.
The primary objective of an InvIT is to function as a collective investment scheme, similar to a mutual fund, allowing both individual and institutional investors to directly invest in infrastructure projects and earn a portion of the income generated in return.
