This document summarizes the Ministry of Road Transport and Highways' response to questions raised in the Lok Sabha on August 21, 2025, regarding Infrastructure Investment Trusts (InvITs) and highway project development.
* **InvITs for Retail Investors:** The government has decided to establish a Public InvIT, in addition to the existing National Highways Infra Trust (NHIT). The specific size of the national highway bundle and the allocation for retail investors are yet to be determined.
* **Detailed Project Reports (DPRs):** To address concerns about the quality and design issues in DPRs and ensure fair competition, the government is considering awarding DPR consultancy work based on the H1 bidder selected through a Quality and Cost Based Selection (QCBS) process. This system will assess past performance, credentials, and capacities of DPR consultants, with bidding undertaken on a performance-based guarantee.
* **EPC vs. InvIT Models:** The Engineering, Procurement, and Construction (EPC) model is a method for constructing highways through competitive bidding. The InvIT model, on the other hand, is a monetization strategy for completed highways. Therefore, the two models do not compete with each other.
* **Monetization and Economic Impact:** The government monetizes national highways through the National Monetization Pipeline, auctioning tolling rights to concessionaires for a fixed period via transparent bidding processes, SEBI-regulated book building, and bond issuance in the case of InvITs. After the concession period, tolling rights revert to the government. Road assets remain government property, and user fee (toll) charges are governed by rules under the National Highways Act, 1956. The response asserts that tolling rights are auctioned through a transparent bidding process, and that the road assets will revert to the government at the end of the fixed period.
Key Entities Referenced
National Highways Authority of India (NHAI): A government agency responsible for the development, maintenance and management of National Highways in India.
Infrastructure Investment Trust (InvIT): A collective investment scheme similar to a mutual fund, which enables direct investment of money from individual and institutional investors in infrastructure projects to earn a small portion of the income as return.
National Highways Infra Trust (NHIT): A Public InvIT (Infrastructure Investment Trust) setup for monetization of constructed highways.
Detailed Project Report (DPR): A comprehensive report that outlines the plan, design, cost, and other critical details of a project.
Engineering, Procurement and Construction (EPC): A common form of contracting arrangement in the construction industry.
National Monetization Pipeline: An initiative by the government for monetization of various assets, including National Highways.
National Highways Act, 1956: An act of the Parliament of India to provide for the declaration of certain highways to be national highways and for matters connected therewith.
Nitin Jairam Gadkari: The Minister of Road Transport and Highways in India.
GOVERNMENT OF INDIA
MINISTRY OF ROAD TRANSPORT AND HIGHWAYS
LOK SABHA
UNSTARRED QUESTION NO. 4679
ANSWERED ON 21ST AUGUST, 2025
InvIT ISSUE BROUGHT BY NHAI
4679. MR PATHAN YUSUF:
Will the Minister of ROAD TRANSPORT AND HIGHWAYS
सड़क परिवहन औि िाजमार्ग मंत्री
be pleased to state:
(a) whether the National Highways Authority of India (NHAI) has
decided to set aside rupees 25,000 crore worth of units for retail
investors in its Infrastructure Investment Trust (InvIT) issues during
the current fiscal year, if so, the details thereof;
(b) whether the Government is aware that skipping the lowest-bidder
system in awarding Detailed Project Report (DPR) contracts may lead
to allegations of favouritism or cost inflation, if so, the details thereof;
(c) the mechanisms being planned to ensure fair competition;
(d) the reasons for shifting from the traditional Engineering,
Procurement and Construction (EPC) model to the InvIT model for
monetization of highways; and
(e) whether any independent economic impact study has been
conducted regarding the longterm consequences of such privatisation,
if so, the details thereof?ANSWER
THE MINISTER OF ROAD TRANSPORT AND HIGHWAYS
(SHRI NITIN JAIRAM GADKARI)
(a) The Government has decided to set up a Public InvIT in addition
to National Highways Infra Trust (NHIT). However, the size of the
bundle of the National Highways or the extent of offerings for retail
investors is to be decided.
(b) & (c) The Government has come across a number of quality,
quantity as well as design issues in Detailed Project Reports
(DPRs) leading to frequent changes of scope, etc. To solve these
issues and in order to ensure fair competition, Government is
contemplating to award the work of DPR Consultancy based on H-1
bidder which shall be decided through QCBS (Quality and Cost Based
Selection) process. The system envisages a fair and objective
assessment of past performance as well as credentials and capacities
of the DPR consultants and bidding to be undertaken on the
performance back guarantee.
(d) Engineering, Procurement and Construction (EPC) is one mode of
construction of highways through competitive bidding process where
as InvIT model is a monetization of constructed highways adopted by
the Government. As such, there is no question of EPC mode
competing with InvIT.
(e) The Government has undertaken monetization of National
Highways under National Monetization Pipelines, whereby only
tolling rights are auctioned to Concessionaires through a transparent
bidding process (SEBI-regulated book building and bond issuing
process in case of InvIT) for a fixed period after which the tolling
rights revert to the Government. In all cases, the road assets remain
vested in the Government and user fee (toll) charges are in
accordance with Rules made under the National Highways Act, 1956.
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