Over Rs 3.5 trillion of assets to get monetised in next one year: ICRA

The next year is likely to witness asset monetisation of over Rs 3.5 trillion through infrastructure investment trusts (InvITs) and real estate infrastructure trusts (REITs). As per ICRA, a constraint has been removed with the recognition of InvITs and REITs as borrowers under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, and lenders to these trusts will have adequate statutory enforcement options now. In addition, the Insurance Regulatory and Development Authority of India has recently allowed insurers to invest in debt instruments of InvITs and REITs rated AA and above as part of their approved investments, which demonstrates the growing comfort of lenders as well as investors around such structures. The infrastructure monetisation may entail the government using the platform for National Highways Authority of India (NHAI), Power Grid Corporation of India Limited (Powergrid) and GAIL Limited.

Foreign direct investments (FDIs) in the country grew 19 per cent to $59.64 billion during 2020-21 on account of measures taken by the government on the policy reforms, investment facilitation and ease of doing business fronts. Total FDIs, including equity, re-invested earnings and capital, rose 10 per cent to the highest ever figure of $81.72 billion during 2020-21, as against $74.39 billion in 2019-20. In terms of top investor countries, Singapore was at the top with a 29 per cent share. It was followed by the US (23 per cent) and Mauritius (9 per cent) in the last fiscal year. The computer software and hardware sector attracted the highest inflows, with around 44 per cent share of the total FDI equity inflows. It was followed by construction (infrastructure) activities at 13 per cent and the services sector at 8 per cent. Gujarat was the top recipient state during 2020-21 with 37 per cent share of the total FDI equity inflows, followed by Maharashtra (27 per cent) and Karnataka (13 per cent).