The Department of Industries and Mines, Government of Gujarat, along with Gujarat Infrastructure Development Board (GIDB) and Securities and Exchange Board of India (SEBI) organized a workshop on “InvITs, REITs, and Municipal Debt Securities as Alternative Financing” on Saturday. Mechanism for Infrastructure Development in Gandhinagar” where policy makers, financial experts, and industry stakeholders discussed possible solutions to address the funding shortfall in India’s infrastructure sector.
Highlighting the pivotal role of alternative financial sources such as Infrastructure Investment Funds (InvITs), Real Estate Investment Trusts (REITs), and Municipal Debt Securities in unlocking private capital for infrastructure projects, promoting economic growth and increasing the sustainability of urban development, efficient for infrastructure development financing, Discussions focused on sustainable, and scalable approaches.
At the event, Ashwini Bhatia, Whole Time Member, SEBI, highlighted the huge growth of the capital market and the amount of potential it offers to the infrastructure sector. The panelists agreed that “InvITs have emerged as a powerful mechanism to attract private capital to infrastructure projects” and emphasized the role of InvITs in creating long-term, stable returns for investors, enabling infrastructure developers to unlock the value of their assets.
“Invitation and REITs offer predictable yields, typically between 7% and 9% annually, making them attractive to lenders looking for stable returns. REITs, which allow investors to pool funds to invest in commercial real estate, large-scale urban development was identified as an ideal option for financing projects. The introduction and expansion of municipal debt securities was seen as a game-changer for cities and local governments seeking to finance critical infrastructure projects. Issuing bonds allows them to tap directly into the capital market, to raise funds for critical projects such as water treatment plants, road development, and public transport,” a statement on Saturday underlined.
“Experts agreed that municipalities need to strengthen their credit worthiness and ensure financial disclosure transparency to attract a wider range of investors. For Gujarat, the discussion focused on alternative financing mechanisms, not just instruments. But enablers of transformation,” it added.