Daily Prelims Notes 30 October 2023

Daily Prelims Notes

30 October 2023

Table Of Contents

1. RBI conducts Rs 4175 cr outright OMO sales on Oct 16-20, shows data
2. Developed countries to overshoot carbon emissions goal: study
3. Study traces Turkey quake to interrupted ‘chat’ between fault lines
4. When Rivers And Their Cargo Traffic Run Dry
5. ABHA – Ayushman Bharat Health Account
6. India Agrivoltaics Alliance to be launched today
7. PM Modi announces launch of ‘Mera Yuva (MY) Bharat’ portal for youth
8. The Indian Railways’ revenue problem
9. Qualcomm’s pivot into the Generative Artificial Intelligence market
10. Cayman Islands’ exit from the FATF grey list
11. India to become $30-trillion economy by 2047: Niti draft vision document
12. NHAI’s InvIT plans

1. RBI conducts Rs 4175 cr outright OMO sales on Oct 16-20, shows data

Subject: Economy

Section: Monetary Policy

Context: In October meeting, the monetary policy committee voted unanimously to keep interest rates unchanged. This was widely expected. But what was not was the RBI Governor stating that the central bank would consider open market operations in order to manage liquidity. This announcement drove the 10-year government bond yield up by 12 basis points to 7.34 per cent.

OMO:

• Open market operation is the sale and purchase of government securities and treasury bills by RBI without printing new currency.
• Open market operation is a tool that the RBI uses to smoothen liquidity conditions through the year and regulate money supply in the economy.
•  When the Reserve Bank feels that there is excess liquidity in the market, it resorts to the sale of government securities, thereby sucking out the rupee liquidity.
• Similarly, when the liquidity conditions are tight, the central bank buys securities from the market, thereby releasing liquidity into the market. It’s used as a tool to rein in inflation and money supply in the system.
• However, when liquidity is sucked out, it can lead to a spike in bond yields as the RBI will release more government securities into the market and bond buyers demand more interest rate on these securities.

2. Developed countries to overshoot carbon emissions goal: study

Subject : Environment

Section: Climate Change

Context:

• Developed countries will end up emitting 38% more carbon in 2030 than they have committed to, going by current trajectories, and 83% of this overshoot will be caused by the United States, Russia, and the European Union, according to a study by the Council for Energy Environment and Water (CEEW), a Delhi-based think tank.

Details:

• Developed countries are responsible for three-fourths of existing carbon emissions in the atmosphere.
• Countries are expected to give an account of their Nationally Determined Contributions (NDCs) at UNFCCCCoP28 (Dubai, UAE), which are their commitments to the UN on emission cuts.

Study findings:

• The NDCs of developed countries already fall short of the global average reduction of emissions to 43% below 2019 levels. Developed countries’ collective NDCs only amount to a 36% cut.
• These cuts are not the result of a planned exercise, but a significant chunk of the cuts were the result of the COVID-19 pandemic that caused a global economic slowdown.
• Collectively, developed countries were to reduce emissions by 5% from their 1990 levels between 2008 and 2012, and by 18% per cent during 2013 to 2020.

Postponing needed cuts:

• Several countries have committed to achieving net zero carbon emissions by 2050. Doing so would require steady measurable cuts every decade until that year.
• To keep temperatures below 1.5°C,developed countries need to cut emissions to 43% below their 2019 level.
• The CEEW study found that, based on their current emissions trajectories, their cuts would likely amount to only 11% by 2030.
• Except for two countries– Belarus and Norway– none of the developed countries seem to be on the path to meet their 2030 targets, though Japan and Kazakhstan are expected to miss their targets by only a single percentage point.
• If all developed countries would have to reach net zero by 2050, they would require more than four times the average annual reductions they achieved between 1990 and 2020.

Shifting the burden:

• The burden to mitigate global warming shifts to developing countries, which is problematic because of the financial burden.
• Developing countries say that developed countries, who are responsible for most of the carbon burden, must pay developing countries for transitioning and wean themselves away faster.
• Developed countries argue that countries such as India and China, given their size, cannot entirely absolve themselves from steeper emission cuts.
• Developing countries have also not received$100 billion/year promised by developed countries to aid renewable-energy infrastructure.

Council for Energy Environment and Water (CEEW)

• Founded in 2010
• It is a Not-For profit Think Tank and policy institution based in New Delhi, India.
• It was formed to provide independent research-based insights to policymakers for building a sustainable India.
• The think-tank advises the Indian government.

Source: TH

3. Study traces Turkey quake to interrupted ‘chat’ between fault lines

Subject: Geography

Section: Physical geography

Context:

• A pair of powerful earthquakes struck Turkey and Syria in February 2023. The earthquakes weren’t entirely unexpected given Turkey’s seismic history, but scientists were startled by their unprecedented scale. A study unearthed the intricate union of tectonic forces that led to the disaster.

Geological anatomy:

• The earth’s crust consists of tectonic plates. Fault lines form where these plates interact, as they collide, pull apart or slide past each other. When these plates abruptly grind and slip past each other, they release pent-up pressure, leading to earthquakes.
• The earthquakes in Turkey occurred along the East and North Anatolian Fault Lines, which run 700 km and 1,500 km long, respectively.
• A seismic “cascade” broke through fault bends and step-overs, which are otherwise barriers to the propagation of an earthquake.

Cascade of ruptures:

• The unusual interaction initiated a cascade of ruptures, resulting in a larger-than-usual total rupture length and a more tremendous potential for destruction. In places where there were no buildings and/or where no people died, scientists observed craters after the earthquakes.
  • The first earthquake (M7.8) struck near Gaziantep on a strike-slip fault, a type of tectonic plate boundary where two plates slide horizontally past each other.
  • The next quake (M7.7) hit near Ekinözü, roughly 200 km north. They caused substantial damage along the East Anatolian Fault, which runs through eastern Turkey, extending from near Turkey’s border with Syria to the northeastern region.
• The Narlı Fault and Çardak–Sürgü Fault Zone are also primarily located in eastern Turkey. They extend from the southern part of Turkey to the northeastern part, roughly parallel to the border with Armenia.
  • They both experienced separate earthquakes. The ground near the coast some 200 km to the southwest began to move like a liquid. The Cyprian geological survey department  recorded a minor tsunami near the island in the eastern Mediterranean Sea.

Comparative analysis:

• The above study was distinguished by two methods: kinematic slip inversion and fault-property modelling.
  • Kinematic slip inversion is like rewinding an earthquake video to understand how fault surfaces moved, indicating what might have occurred underground.
  • In fault-property modelling, researchers estimate the characteristics of the fault, like friction and material properties, to predict how an earthquake is likely to spread along it.
• These predictions are then compared to real earthquake data to gain insights.

Source: TH

4. When Rivers And Their Cargo Traffic Run Dry

Subject: Geography

Section: Places in news

Context:

• Shrinking rivers are now posing a major challenge to the global shipping sector.

Details:

• The Amazon river in the Brazilian rainforest is at its lowest level in over a century due to a severe drought.
• The depleted levels of the Amazon river at its critical passage points renders maritime operations unfeasible at the Brazilian port of Manaus.
• Shipping companies are considering levyinga revised low-water surcharge on all cargo from or to Manaus port.
• The Panama Canal has an annual drought season lasting from January to May. To counter this and keep the canal navigable, water is usually drawn from the Alajuela and Gatun lakes. But climate change, including shifting rain patterns, have resulted in extended periods of extremely low water levels in the canal.
• Previously, the Rhine River and Mississippi river also faced a similar situation.

The Amazon River

• Coming a close second after the Nile as the world’s longest river, the Amazon River sets the record in terms of the sheer volume of water that it carries – a mind-boggling average discharge of 219,000 m₃/sec of water.
• It is estimated that approximately one-sixth of all fresh water that drains into the world’s oceans goes through the 320-km-wide delt  of the Amazon, where it meets the Atlantic Ocean.

Major roles of the Amazon River
As the drainage system of the Amazon Basin, the Amazon River and its approximately 1,100 tributaries play major roles in the ecology of the basin.

Before roads and airstrips started appearing in the basin, these waterways were the major access routes to the interior areas of Brazil and the northern half of South America.

For example, the only way you can get to Iquitos, Peru, which is right on the Amazon River, is to board a plane or a boat. There are no roads to get there.

Origins and course of the river

The Amazon River has its source high in the Peruvian Andes, at an elevation of 5,598 m. There, at a mere 192 km from the Pacific Ocean where it once flowed into, the Amazon River begins as a small tributary called the Carhuasanta.

As it heads east, it flows into and becomes the Hornillos, which merges into the Apurimac, a major tributary that eventually joins the Ene, the Tambo and then the Ucayali.

After an initial drop in elevation, the Amazon River steadies its descent towards the Atlantic Ocean at a rate of 1.5 cm for every kilometre over a distance of over 6,400 km. In some places, the river reaches a width of 10 km, as far as 1,600 km upriver, and large ships can dock all the way up to Iquitos, Peru

Drainage:

It has the largest drainage area of any river system.

Its watershed spans the countries of Brazil, Peru, Ecuador, Colombia, Venezuela, and Bolivia.

Roughly two-thirds of the Amazon’s main stream and by far the largest portion of its basin are within Brazil.

Tributaries:

It has more than 1,100 tributaries, of which seventeen measures over 1,500-kilometers long.

Notable tributaries include the Rio Negro, the Madeira River, Xingu River, etc.

Port of Manaus:

• It is a riverport located on the Rio Negro in Manaus, Amazonas, Brazil.
• It is the main transport hub for the entire upper Amazon basin.

Source: Archyde

5. ABHA – Ayushman Bharat Health Account

Subject: Schemes

Section: Health

Key to your digital healthcare journey

What is ABHA number?

• ABHA number is a 14 digit number that will uniquely identify you as a participant in India’s digital healthcare ecosystem. ABHA number will establish a strong and trustable identity for you that will be accepted by healthcare providers and payers across the country.
• One can participate at your own free will and choose to create one’s ABHA number voluntarily. Also, at any time, one can also request for permanent deletion or temporary deactivation of your ABHA number.

What is ABHA Address?

• ABHA (Ayushman Bharat Health Account) Address is a unique identifier (self declared username) that enables you to share and access your health records digitally.
• An ABHA address may look like ‘yourname@consent manager’.
• One can use one’s ABHA number to seamlessly sign up for a ABHA address, and ensure that the health records created for them are shared only with them. To enable health data sharing, it is recommended that you create an ABDM ABHA address and link it with your ABHA number.

Benefits of ABHA number:

• Unique & Trustable Identity
  • Establish unique identity across different healthcare providers within the healthcare ecosystem
• Unified Benefits
  • Link all healthcare benefits ranging from public health programmes to insurance schemes to your unique ABHA number
• Hassle-free Access
  • Avoid long lines for registration in healthcare facilities across the country
• Easy PHR Sign Up
  • Seamless sign up for PHR (Personal Health Records) applications such as ABDM ABHA application for Health data sharing

About Ayushman Bharat Digital Mission (ABDM):

• It aims to develop the backbone necessary to support the integrated digital health infrastructure of the country. It will bridge the existing gap amongst different stakeholders of Healthcare ecosystem through digital highways.

ADBM Ecosystem

Source: NDHM

6. India Agrivoltaics Alliance to be launched today

Subject: Science and Tech

Section: Health

Context:

• The National Solar Energy Federation of India (NSEFI) will launch the ‘India Agrivoltaics Alliance’ in Delhi.

India Agrivoltaics Alliance (IAA):

• Launched by: NSEFI
• Aim: To bring together all stakeholders across the value chain in the solar and agricultural sectors, including industry associations, research institutes, financial institutions, think-tanks, civil societies and farmer producer organisations.
• Supported by: India Climate Collaborative (ICC) and Bloomberg Philanthropies.

What will the alliance do?

• The alliance will examine agri-voltaics closely, checking out which crops are best under a given situation. Companies like ITC, Nestle and Reliance, which procure agricultural produce from farmers, can also buy solar electricity.
• Farmer producer organizations( FPOs) can also put up agri voltaics.

What is Agri Voltaics?

• Agri-voltaics is the “in-thing” in the solar industry; it refers to the practice of putting up solar panels at a certain height and with such an architecture as to allow cultivation of crops underneath them.
  • The federation is convinced that there is a net gain in agri-voltaics, when the additional costs are compared with the incremental gains from both solar and agriculture.
• A few agri-voltaic projects have happened in India. A recent compendium of 20-odd agri-voltaic projects in India, brought out by NSEFI and the Indo German Energy Forum shows that the total capacity of agri-voltaics in India is under 10 MW.
• Agri-voltaic projects in India: at Cochin Airport (biggest one), 1 MW plant of Abellon Energy in the Aravalli district of Gujarat, built in 2012 (oldest in India).
• Water used for cleaning the panels goes for watering the plants—turmeric, ginger, watermelon and bottle gourd.

National Solar Energy Federation of India (NSEFI)

• NSEFI is India’s solar policy advocacy body and an umbrella organisation representing solar energy companies that are active along the whole Solar value chain comprising of leading International, National, and regional companies including Solar Developers, Manufactures, EPC Contractors, Rooftop Installers, System Integrators, Manufacturers, Small and Medium Enterprises.
• NSEFI’s vision to make Solar Energy affordable in India is now achieved in less than a decade since India started accelerating its Solar energy installations.
• NSEFI works in a complimentary manner with Central and State Governments to achieve India’s National targets of 100 GW by 2022&Renewable Target of 450 GW by 2030.
• NSEFI’s efforts have culminated into making India’s solar a successful growth story where India is today the 5th Largest country in terms of installed solar capacity.

Source: Business Line

7. PM Modi announces launch of ‘Mera Yuva (MY) Bharat’ portal for youth

Subject : Schemes

Section: Msc

MY Bharat platform:

• The Prime Minister of India announced a new ‘MY Bharat’ platform will be launched on October 31 on the birth anniversary of Sardar Vallabhbhai Patel.

• MY Bharat platform: MY is the acronym for Mera Yava.
• Aim of the platform: to provide youth with an opportunity to play an active role in various Government programmes.
• This is a unique effort of integrating the youth power of India in building a developed India.
• The Azadi Ka Amrit Mahotsav, which has been going on for the last two and a half years across the country, will conclude on October 31.
• October 31 also marks former Prime Minister Indira Gandhi’s death anniversary.

The establishment of Mera Yuva Bharat (MY Bharat) would lead to:

• Leadership Development in the Youth:
  • Improve the leadership skills through experiential learning by shifting from isolated physical interaction to programmatic skills.
  • Investing more in youth to make them social innovators, leaders in the communities.
  • Setting the focus of the Government on Youth Led development and to make the Youth “active drivers” of development and not merely “passive recipients”.
• Better alignment between youth aspirations and community needs.
• Enhanced efficiency through Convergence of existing programmes.
• Act as a one stop shop for young people and Ministries.
• Create a centralized youth database.
• Improved two-way communication to connect youth government initiatives and activities of other stakeholders that engage with youth.
• Ensuring accessibility by creating a phygital ecosystem.

Khadi products:

• He also announced that sales of khadi products have reached nearly ₹1.25 lakh crore as against ₹30,000 crore ten years back.
• It means its benefit reaches myriad sections across cities and villages, benefiting our weavers, handicraft artisans, our farmers, cottage industries engaged in growing Ayurvedic plants.
• India is becoming the world’s biggest manufacturing hub. Many big brands are manufacturing their products here.

Source: Business Line

8. The Indian Railways’ revenue problem

Subject :Economy

Section: Msc

Context:

• The Indian Railways (IR) has been on a spending spree with respect to capital expenditure (capex), particularly after the government merged its rail budget with the main budget.
• However, its operating ratio, which is the ratio of ordinary working expenses to the gross traffic receipts, has shown no improvement. A lower ratio implies better profitability and surplus for capital investment.

Rising Expenditure

• Present scenario: Indian Railways intensifies capital expenditure post-budget merger.
• Hurdles in generating capital: Operating ratio stagnates, hindering profitability and capital surplus.
• Over-reliance on Gross Budgetary Support (GBS) and Extra Budgetary Resources (EBS) leads to growing debt.

Concerns

• Sources of Loss: Passenger services incur significant losses, necessitating cross-subsidization from profitable freight segment.
• Report by CAG: Comptroller and Auditor General highlight Rs. 68,269 crore passenger service losses in 2021-22.
• Increasing Freight Volume: Emphasis on boosting freight volumes to improve revenue, but current growth lags behind national economic growth.

Suggestive Measures

• Optimizing Freight Business: Artificial division of cargo into goods and parcels hampers efficient handling and transportation.
• Bifurcation of cargo: Proposal to categorize cargo based on characteristics, bulk and non-bulk.
• Need for reforms: Declining rail share in crucial commodities like coal, iron ore, and cement underscores need for strategic reforms.

9. Qualcomm’s pivot into the Generative Artificial Intelligence market

Subject :Science and Tech

Section: Awareness in IT & Computers

Context:

• Last week, Qualcomm made a series of announcements that highlights  the chipmaker’s pivot to Generative Artificial Intelligence (gen AI).
• All the products it unveiled were aimed at supporting gen AI applications so mobile units can perform AI­ based tasks on device.

What is Generative Artificial Intelligence?

• GAI is a rapidly growing branch of AI that focuses on generating new content (such as images, audio, text, etc.) based on patterns and rules learned from data.
• The rise of GAI can be attributed to the development of advanced generative models, such as Generative Adversarial Networks (GANs) and Variational Autoencoders (VAEs).
• These models are trained on large amounts of data and are able to generate new outputs that are similar to the training data. For example, a GAN trained on images of faces can generate new, synthetic images of faces that look realistic.
• While GAI is often associated with ChatGPT and deep fakes, the technology was initially used to automate the repetitive processes used in digital image correction and digital audio correction.
• Arguably, because machine learning and deep learning are inherently focused on generative processes, they can be considered types of GAI, too.

Applications:

• Art and Creativity: It can be used to generate new works of art that are unique and innovative, helping artists and creatives explore new ideas and push the boundaries of traditional art forms.
• DeepDream Generator – An open-source platform that uses deep learning algorithms to create surrealistic, dream-like images.
• DALL·E2 – This AI model from OpenAI generates new images from text descriptions.
• Music: It can help musicians and music producers explore new sounds and styles, leading to more diverse and interesting music.
• Amper Music – creates musical tracks from pre-recorded samples.
• AIVA – uses AI algorithms to compose original music in various genres and styles.
• Computer Graphics: It can generate new 3D models, animations, and special effects, helping movie studios and game developers create more realistic and engaging experiences.
• Healthcare: By generating new medical images and simulations, improving the accuracy and efficiency of medical diagnoses and treatments.
• Manufacturing and Robotics: It can help optimize manufacturing processes, improving the efficiency and quality of these processes.

Significance for India:

• As per NASSCOM data, the overall AI employment in India is estimated at about 416,000 professionals.
• The growth rate for the sector is estimated at about 20-25%. Further, AI is expected to contribute an additional USD 957 billion to India’s economy, by 2035.

What are the Concerns Related to GAI?

• Accuracy: One of the biggest challenges is ensuring that the outputs generated by GAI are of high quality and accurate.

This requires the development of advanced generative models that can accurately capture the patterns and rules learned from data.

• Partisan GAI Models: GAI models are trained on large amounts of data, and if that data is biased, the outputs generated by GAI may also be biased. This can lead to discrimination and reinforce existing societal biases.
• Privacy: Training GAI models requires access to large amounts of data, which could include personal and sensitive information.

There is a risk that this data could be used for unethical purposes, such as for targeted advertising or for political manipulation.

• Responsibility: Since GAI models can generate new content, such as images, audio, or text it may be used to generate fake news or other malicious content, without knowing who is responsible for the output. This could lead to ethical dilemmas over responsibility.
• Automation and Lowering Job: GAI has the potential to automate many processes, which could lead to job displacement for people who are skilled in those areas.

10. Cayman Islands’ exit from the FATF grey list

Subject :Economy

Section: External Sector

In News: FATF removes offshore tax haven Cayman Islands from its ‘grey list’.

Key Points:

• The Financial Action Task Force (FATF), an inter-governmental body that sets anti-money laundering standards, has removed offshore tax haven Cayman Islands from its ‘grey list’.
• The region was put on the grey list for increased monitoring by the FATF, or the Financial Action Task Force, a global money laundering and terrorist financing watchdog, in February 2021.
• FATF said last week Cayman Islands had met the commitments in its action plan regarding the strategic deficiencies identified in 2021.
• Besides Cayman, Panama, Jordan, and Albania have been removed from the list, which requires jurisdictions to be placed under increased monitoring until the identified deficiencies are resolved in their framework. FATF has added Bulgaria in the grey list.
• In 2020, the European Union had added Cayman to its black list of tax havens, citing lack of necessary tax reforms.

Why does FATF add countries to the  ‘grey list?

• ’Such steps are taken to ensure that countries strengthen their anti-money laundering (AML), counter terrorism financing (CFT) and proliferation of financing systems.
• This includes applying sanctions that are effective on those that do not file accurate beneficial ownership information and prosecuting all types of money laundering in line with the jurisdiction’s risk profile.

Significance of the change for India?

• The removal of Cayman Islands from the FATF grey list would bring relief to NBFCs, payment system operators and alternative investment funds that face restrictions in giving significant stakes to investors from FATF non-compliant jurisdictions
• Cayman Islands’ exit from the FATF grey list last week will bolster global private equity funds looking to invest into non-banking financial companies (NBFCs) based in India.
• Cayman is among the top 15 jurisdictions for foreign portfolio investments into India. Several US and European funds prefer setting up holding companies and funds in Cayman Islands for investments into India.

Why are NBFCs likely to benefit?

• RBI does not grant approval for shareholding in NBFCs from grey list jurisdictions.
• RBI had issued a circular in February 2021 imposing restrictions on investments in NBFCs by investors from non-compliant FATF jurisdictions.
• New investors from non-compliant regions were prohibited from directly or indirectly acquiring ‘significant influence’ in the existing investee NBFCs as well as companies seeking Certification of Registration.
• The term ‘significant influence’ was defined as having more than20 per cent of actual and potential voting power.

11. India to become $30-trillion economy by 2047: Niti draft vision document

Subject : Economy

Section: National Income

In News: India is estimated to become a $30 trillion developed economy by 2047, preliminary results from the Centre’s vision document which is being prepared have shown, Niti Aayog.

Key Points:

• India is currently estimated to be the fifth largest economy with a GDP of $3.7 trillion.
• Several estimates show that India’s GDP is expected to overtake Japan and Germany by 2030.  Ratings agency S&P estimates that India’s nominal GDP will rise from $3.4 trillion in 2022 to $7.3 trillion by 2030.
• The preliminary estimates of the Centre’s vision document project the Indian economy to a $30 trillion developed economy by 2047.
• Going by the preliminary numbers provided by the Niti Aayog, estimates show that the economy will need to post an annual average economic growth of 9.2% between 2030-2040, 8.8% between 2040-2047 and 9% between 2030 to 2047.
• NITI Aayog Vision Document:
  • The vision document will outline the structural changes and reforms needed to reach the objective of becoming a 30-trillion dollars developed economy by 2047.
  • It will include government process re-engineering, reforms and cut down on duplication of work by different ministries and departments. It is also expected to have details about the country’s global engagement on trade, investment, technology, capital, research and development entities.
  • The strategy will also include implementation roadmaps and will have measures to ensure that the economy does not fall into the “middle-income trap”.
  • The document is also expected to outline which Indian companies would be global leaders and also the strategy for creating an ecosystem needed to achieve the goal.
  •  It will also have details about creating human capital to achieve the vision, how to leverage the country’s market size and how to address regional disparities. The vision document will also detail the roadmap where India will be in 2030 and in 2047.
  • The document is likely to be presented by December 2023.

12. NHAI’s InvIT plans

Subject :Economy

Section: Monetary policy

In News: National Highways Authority of India to raise ₹9,000 crore via the National Highways Infra Trust (NHIT).

Key Points:

• National Highways Infra Trust (NHIT), the investment trust sponsored by the National Highways Authority of India, plans to raise as much as ₹9,000 crore after Diwali through a mix of debt and equity.
• The infrastructure investment trust’s (InvIT’s) third round of fundraising, involving the monetization of six 250 km highway stretches, will be conducted in phases, targeting domestic and global investors.
• Additionally, a proposed non-convertible debentures (NCD) issue, the size of which would be similar to last year’s ₹1,500 crore, would also be offered to retail investors with assured returns of close to 8%.
• Later in March, NHIT plans another fundraising to raise ₹5,000-6,000 crore in the fourth phase of asset monetization. These funds will be allocated to six highway stretches spanning 635 km, which have been identified by NHAI for the InvIT. These highways are generating around ₹400 crore in annual revenue.
• The InvIT is not inviting retail investors in the equity issue in the third round, and this would be considered later after the road projects mature, providing steady revenue streams with increasing traffic, giving an attractive investment opportunity to investors.

What are InvITs?

• InvITs are instruments, on the lines of mutual funds, that pool money from investors and invest in assets that provide steady cash flows over time. InvITs typically enable infrastructure developers to monetize assets under a single entity (trust structure).
• NHAI launched its InvIT, the  National Highways Infra Trust (NHIT) in October 2021, intending to mop up ₹5,100 crore as part of the government’s long-term plans to monetize road assets.
• The InvIT acquired five toll road assets of 390 km, spread across Rajasthan, Gujarat, Telangana and Karnataka initially.
• The road assets brought under the InvIT had an enterprise value of over ₹8,000 crore. So far, NHAI has raised ₹10,000-11,000 crore via the InvIT route in two rounds. The annual returns from road assets under two rounds are more than ₹850 crore.

NHAI InvIT (National Highways Infra Trust):

• Roads form a significant portion of the national monetization pipeline. In 2021, the central government had identified national highway and road assets worth ₹1.6 trillion to be monetized by 2024-25 of the total monetization targets for the same period is ₹6 trillion.
• In total, NHAI aims to generate up to ₹45,000 crore through monetization in FY24, utilising various funding models, including InvITs and the securitization of road assets constructed by NHAI’s special purpose vehicles.
•  Of the annual target, ₹30,000 crore will be through the toll-operate-transfer mode and securitization of toll revenues, while the remaining ₹15,000 crore will be through InvITs.