From Highways to High Stakes: India’s Record ₹18,380 Crore Monetisation Drive Unpacked
India’s infrastructure ambitions just hit a new milestone. The National Highways Infra Trust (NHIT), a brainchild of the National Highways Authority of India (NHAI), has successfully completed its largest-ever monetisation round in the roads sector, raising a staggering ₹18,380 crore. As the country accelerates its march towards a $5 trillion economy, this development signals more than just financial engineering—it’s a blueprint for the future of public-private collaboration.
But while this sounds like a win-win, questions linger: Who really benefits? And could the toll-paying public be left behind in this high-value game?
Under the visionary leadership of our Hon’ble PM Shri @narendramodi Ji, National Highways Infra Trust (NHIT), sponsored by MoRTH will open public issue of secured, rated, listed and redeemable NCDs (InvIT Bonds) that will offer an effective yield of 8.05% per annum. pic.twitter.com/WvwvHQqmRH
— Nitin Gadkari (@nitin_gadkari) October 16, 2022
The Big Picture: What Just Happened?
In its fourth round of fundraising since its inception in 2020, NHIT has achieved what officials are calling a landmark deal. The trust now holds a diversified portfolio of 26 operating toll roads across 12 states, covering 2,345 kilometers and 41 toll plazas, with concession periods ranging between 20 to 30 years.
This time around, NHIT raised:
- ₹8,340 crore in capital from a mix of domestic and international investors, including pension funds and private entities.
- ₹10,040 crore in debt sourced from Indian financial institutions.
What makes this move particularly groundbreaking is the Employees’ Provident Fund Organisation (EPFO) investing ₹2,035 crore—its first-ever investment into an infrastructure trust.
Why It Matters: Monetisation with a Mission
The government has set an ambitious target of ₹30,000 crore for road monetisation in the Union Budget, and NHIT’s latest move brings it more than halfway there.
The funds raised will be directed towards acquiring national highway stretches, assessed at a concession value of ₹17,738 crore, including a premium of ₹97 crore. These deals are seen as a crucial step in the government’s National Monetisation Pipeline (NMP), which aims to unlock value from public infrastructure and attract private sector efficiency.
Double Win or Double Trouble? Two More Highways Auctioned
In parallel, the NHAI also auctioned two completed highway stretches for ₹6,584 crore under the Toll, Operate, and Transfer (TOT) model:
- Allahabad Bypass (84 km) – Bagged by Cube Highways for ₹2,156 crore.
- Lalitpur–Sagar–Lakhnadon stretch (316 km) – Secured by IRB Infra Trust for ₹4,428 crore.
Notably, these were rebid after an earlier round fetched lower offers. This time, NHAI managed to extract nearly 9% more—a sign of rising investor confidence.
The Government’s Stand: Monetisation ≠ Privatisation
NHAI Chairman Santosh Yadav insists that monetisation isn’t a sellout but a strategy. “We are monetising assets only when they assure robust revenue potential. There’s no hurry—we’ll auction when the price is right,” he stated.
According to insiders, many of these projects are former Build-Operate-Transfer (BOT) roads now returning to NHAI after their concession periods ended, giving the authority a fresh opportunity to re-bundle and re-auction them for additional revenue.
The Other Side: Public Interest or Pricey Toll Future?
While the numbers sparkle on paper, there’s a different sentiment brewing among citizens and analysts.
Critics argue:
- Toll burdens may increase as private players seek to recoup their investments faster.
- There’s a lack of transparency in how toll rates are determined post-monestisation.
- Long-term public interest might be sidelined in the quest for short-term fiscal gains.
Moreover, concerns remain about whether essential services like highways should be commercialised for investor profits, especially when the end users—common citizens—continue to foot the bill.
A Growing Trend: Monetisation As a Model
Since 2018, NHAI has monetised 1,614 km of operational national highways, fetching ₹26,366 crore. Another ₹10,200 crore has been raised through NHIT alone for an additional 636 km. With the success of this model, more such bundles are expected before the end of this financial year.
Monetisation, when executed with clarity and fairness, could be the key to solving India’s infrastructure financing puzzle. But it walks a tightrope between economic necessity and public accountability.
The Takeaway: More Than Just Miles and Money
This record monetisation is not just a financial transaction—it’s a strategic bet on how India wants to build and fund its future. It opens up opportunities for:
- Retail and institutional investors to participate in long-term infrastructure returns.
- Faster infrastructure development without overburdening public finances.
- Job creation and regional connectivity across India’s hinterlands.
But for it to truly work, the government must ensure fair tolling practices, transparency in contracts, and robust oversight of private players. Otherwise, what starts as a win for infrastructure could quickly become a burden for the people.
FAQ
1. What is NHIT?
The National Highways Infra Trust (NHIT) is an infrastructure investment trust (InvIT) set up by NHAI to monetize operational highway assets and attract institutional investment.
2. Why is this ₹18,380 crore deal significant?
It marks India’s largest-ever monetisation in the roads sector and brings NHIT’s portfolio to 26 toll roads across 12 states.
3. Who are the major investors in this round?
Investors include domestic and international institutions, notably the EPFO which invested ₹2,035 crore—its first-ever investment in an InvIT.
4. What is the Toll, Operate, Transfer (TOT) model?
It allows private players to operate and maintain completed highways in exchange for upfront payments. They collect tolls during the contract period (20 years in this case).
5. Which highways were auctioned under the latest TOT model?
Cube Highways won the Allahabad Bypass (₹2,156 crore), and IRB Infra Trust secured the Lalitpur–Sagar–Lakhnadon stretch (₹4,428 crore).
6. Will toll rates increase due to monetisation?
Possibly. Private operators might revise tolls within regulatory limits to recover investments, raising concerns among regular highway users.
7. Is this a form of privatisation?
No. The ownership remains with the government, but operational rights are leased out to private firms for fixed periods.
