The National Highways Authority of India (NHAI) is preparing to reserve ₹25,000 crore worth of units for retail investors under its Infrastructure Investment Trust (InvIT) public issue in the current financial year. This allocation, representing 30 to 40 percent of the total issue, aims to expand small investor participation in highway development.
Union Road Transport and Highways Minister Nitin Gadkari stated that a final decision on the proposal will be made within two to three months. The move aligns with the government’s larger plan to construct 10,000 km of highways and monetise ₹50,000 crore worth of assets this year.
InvITs Offer Steady Returns from Toll Revenue
NHAI’s InvITs involve operational, toll-earning highway assets. Investors buying units receive a steady income from toll collections. The government is using this model, along with public-private partnerships, to fund faster infrastructure development without relying solely on the exchequer.
In its first InvIT issue of non-convertible debentures (NCDs) in October 2022, NHAI raised ₹1,500 crore, with 25 percent reserved for retail investors. The offering carried a 7.9 percent half-yearly coupon, equating to an 8.05 percent annual return.
The National Highways Infrastructure Trust (NHIT), launched in October 2021, has so far raised ₹43,638 crore over four funding rounds, covering 2,345 km of national highways.
Reforms in Project Report Awards
To improve project quality, the government will stop awarding Detailed Project Report (DPR) contracts purely based on the lowest price. Gadkari stated that the practice of selecting the L1 bidder often leads to poor-quality infrastructure and higher accident rates.
Now, technical expertise, experience, and proven capability will carry more weight in evaluating DPR bids. Only agencies with qualified personnel and strong track records will be eligible, although final selection will remain price-competitive.
Dedicated Cadre for Border Road Development
The National Highways & Infrastructure Development Corporation Ltd (NHIDCL), which manages strategic roads near India’s borders, will soon get a permanent cadre. Around 1,000 personnel will be hired from the states where the roads are being constructed, such as Arunachal Pradesh, Meghalaya, Jammu and Kashmir, Himachal Pradesh, and Uttarakhand.
Recruitments will be coordinated through the Union Public Service Commission (UPSC). The move reflects India’s growing emphasis on border infrastructure following heightened tensions and road projects in sensitive areas like Arunachal Pradesh and Jammu and Kashmir.
Infrastructure is Central to India’s Growth Plan
Gadkari highlighted that infrastructure is a core driver of economic growth. Since 2014, the government has prioritised highways, tunnels, and connectivity projects to stimulate job creation, industrial growth, exports, and foreign investment.
Strong infrastructure, he noted, is essential to India’s vision of becoming a $5 trillion economy and emerging as the third-largest economic power globally.
