Govt authorised NHAI to set up Infrastructure Investment Trust

Published on December 11, 2019
Current context: The Union Cabinet gave its nod on 11th Dec 19 to authorize National Highways Authority of India, NHAI to set up Infrastructure Investment Trust (InvIT).
Govt authorised NHAI to set up Infrastructure Investment Trust 
  • The Ministry of Road Transport and Highways has given the proposal to set up the Infrastructure Investment Trust.
  • The setting up of the Infrastructure Investment Trust (InvIT) is approved as per Guidelines issued by Securities and Exchange Board of India, SEBI.
  • The proposal seeks to enable NHAI to perform the functions including:
    1. To monetize completed National Highways that have a toll collection track record of at least one year.
    2. NHAI reserves the right to levy a toll on the identified highway.
    3. Provides greater flexibility to investors.
    4. Create opportunities like the generation of specialized Operation and Maintenance Concessionaires.
    5. Attract long-term capital to the Indian highway market and retail domestic savings.
  • NHAI's InvIT will be a Trust established by NHAI under the Indian Trust Act, 1882 and Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014.
  • The objective of the InvIT Trust is to invest primarily in infrastructure projects (as defined by Ministry of Finance).
  • InvIT may hold assets either directly or through an SPV or a holding.

Question: 

Q.1 The Union Cabinet has approved the National Highways Authority of India, NHAI to set up Infrastructure Investment Trust (InvIT) under?
  1. Indian Trust Act, 1882
  2. Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014.
a. Only 1
b. Only 2
c. Both 1 and 2
d. None of the above

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