Budget 2018: InvITs lucrative option for road, power transmission projects

Of the various government-owned assets in the roads and power sectors, power transmission projects and road assets built in the EPC model are the likely candidates for an InvIT in the near future

Finance Minister Arun Jaitley  on Thursday announced that state-run companies and the National Highway Authority of India (NHAI) could use infrastructure investment trusts (InvITs) to raise capital. 

Industry experts say this would work well for engineering, procurement and construction (EPC) road and power transmission projects. However, the process might involve difficulties in separating assets. 

Also, industry officials and experts believe the move will face some initial hiccups. In addition, the government might need to make the instrument more attractive to investors, given the performance of two existing InvITs has been disappointing. “For InvITs to realise their true potential, the government