Infrastructure Investment Trusts
The Union Cabinet had approved the National Highways Authority of India (NHAI) to set up Infrastructure Investment Trust(s) (InvIT) in December 2019. The company has recently started meeting investor groups, as it prepares to come up with its InvIT issue.
The issue will enable NHAI to monetise its completed National Highways that have a toll collection track record of at least one year. The NHAI reserves the right to levy toll on identified highways and it will help the company raise funds for more road development across the country.
What are InvITs?
- Infrastructure investment trusts are institutions similar to mutual funds, which pool investment from various categories of investors and invest them into completed and revenue-generating infrastructure projects, thereby creating returns for the investor.
- The capital market regulator notified the SEBI (Infrastructure Investment Trusts) Regulations, 2014 on September 26, 2014, and these trusts are likely to help facilitate investment in the infrastructure sector.
Structure of InvITs –
- Structured like mutual funds, they have a trustee, sponsor(s), investment manager and project manager. While the trustee (certified by SEBI) has the responsibility of inspecting the performance of an InvIT, sponsor(s) are promoters of the company that set up the InvIT.
- In case of Public–private partnership (PPP) projects, it refers to the infrastructure developer or a special purpose vehicle holding the concession.
- While the investment manager is entrusted with the task of supervising the assets and investments of the InvIT, the project manager is responsible for the execution of the project.
- NHAI’s InvIT will be a Trust established by NHAI under the Indian Trust Act, 1882 and SEBI regulations. The InvIT Trust will be formed the objective of investment primarily in infrastructure projects.
How does it work?
- While the fund will be raised by monetising the completed NHs, the regulations say that the project SPV would distribute not less than 90 per cent of net distributable cash flow to the trust in proportion of its holding in each of the project SPV and further not less than 90 per cent of the net distributable cash flow of the trust will get distributed to the unitholders. The unitholders will get the distributions at least once every six month.
- The fund raised can be invested in the project SPVs by way of an issue of debt. The trust can utilise it to repay their loans or even for prepayment of certain unsecured loans and advances availed by such project SPVs from the sponsor, the project manager and certain members of the sponsor group.
- The Indian InvIT market is not yet mature and has supported formation of 10 InvITs till date — in roads, power transmission, gas transmission and telecom towers sectors — of which only two are listed, according to a report of the task force on National Infrastructure Pipeline. The InvITs listed on the stock exchange are IRB InvIT Fund and India Grid Trust.
- The listed are required to maintain a maximum-leverage ratio of 49 per cent, which can be increased to 70 per cent subject to certain conditions, such as six continuous distributions to unit-holders and AAA-rating.
Benefit to investors –
Given that such trusts comprise largely of completed and operational projects with positive cash flow, the risks are somewhat contained. The investors can benefit from the cash flow that gets distributed as well as in capital appreciate of the units. Unitholders also benefit from favourable tax norms, including exemption on dividend income and no capital gains tax if units are held for more than three years.
Role of women in Indian Navy
The Indian Navy has recently announced selection of two women officers as Observers in the helicopter stream, making them first women airborne combatants who would be operating from warships. The Navy had also inducted the first woman pilot in December last year.
Women in Indian Navy –
- Prior to 1992, women officers were inducted in the Navy only in the medical stream from the Armed Forces Medical Service.
- From July 1992, the Navy started inducting women, initially through a special entry scheme and later through the Short Service Commission, in only select branches of the Navy.
- Over the years, various branches were added to the list, and currently women officers can join the Navy in the streams of Air Traffic Control, Observers, Law, Logistics, Education, Naval Architecture, Pilots in Maritime Reconnaissance Stream only and the Naval Armament Inspectorate.
- It needs to be noted like in the Army and the Air Force, women are currently only inducted as Commissioned Officers and not in Other Ranks which are of categories of Junior Commissioned Officers and Non-Commissioned Officers.
- In the early 2000s women officers from the Medical and Logistics stream were deployed on board Naval ships. While these deployments went on only for four-five years, they were discontinued for various reasons.
Women officers in new streams –
- Last December, the Navy announced the induction of a woman officer as pilot of Dornier aircraft, which are fixed wing aircraft operating from ashore establishments.
- Recently, the Navy announced induction of two women officers as observers for the helicopter stream. Observers are airborne tacticians who fly on board helicopters or fixed-wing aircraft operated by the Navy.
- Till now women were inducted as observers for fixed wing aircraft which take off and land ashore. Entry in the helicopter stream means that women officers can now be deployed on frontline warships from which helicopters can operate.
- In terms of various challenges towards deployment of women onboard warships, the logistics part is not as challenging as one would imagine, especially as most of the large warships of the Navy do have basic living arrangements that can be allocated for women.
- The question of mindset and gender sensitisation, on the other hand, is something many believe would require concerted efforts, and concrete steps are being taken in that direction.
Ministry of Youth Affairs & Sports and United Nations Children Fund (UNICEF) have signed a “Statement of Intent” to establish YuWaah, Generation Unlimited (GenU), a global multi-stakeholder platform in India.
As per the Statement of Intent, the objectives of this project are –
- Support young people by providing entrepreneurship classes (online and offline) with successful entrepreneurs and experts, towards establishing entrepreneurial mindset among young people.
- Upskilling of young people on 21st century skills, life skills, digital skills through online and offline channels and support them through self-learning, for their productive lives and the future of work.
- Create linkages with aspirational economic opportunities to connect young people with employment opportunities, including building pathways to connect them with jobs or self-employment. For this, innovative solutions and technology platforms will be engages to take maximise the scale and reach.
- Providing career guidance support to young people through career portal as well as through job-readiness and self-exploration sessions to make young people career-ready.
- The role of Department of Youth Affairs in this project is to provide relevant experts to participate on the YuWaah Technical Working Groups/ Task Forces.
Successful flight test of ABHYAS – High-speed Expendable Aerial Target (HEAT) was conducted by Defence Research and Development Organisation (DRDO) recently from the Interim Test Range, Balasore in Odisha.
- Abhyas is designed & developed by Aeronautical Development Establishment (ADE), DRDO.
- The air vehicle is launched using twin underslung booster.
- It is powered by a small gas turbine engine and has MEMS based Inertial Navigation System (INS) for navigation along with the Flight Control Computer (FCC) for guidance and control.
- The vehicle is programmed for fully autonomous flight.
- The check out of air vehicle is done using laptop based Ground Control Station (GCS).
- During the test campaign, the user requirement of 5 km flying altitude, vehicle speed of 0.5 mach, endurance of 30 minutes and 2g turn capability of the test vehicle were successfully achieved.
- The vehicle can be used as target for evaluation of various missile systems.
Prototype Fast-Breeder Reactor
Union Minister of State for Atomic Energy and Space, Dr Jitendra Singh has said that Protoype Fast Breeder Reactor (PFBR) being constructed by Bharatiya Nabhikiya Vidyut Nigam Limited (BHAVINI) is expected to get commissioned by October 2022. On completion of commissioning, PFBR will be adding 500 MW of electrical power to the national grid.
About Prototype Fast-Breeder Reactor –
- The Prototype Fast Breeder Reactor (PFBR) is a 500 MWe fast breeder nuclear reactor presently being constructed at the Madras Atomic Power Station in Kalpakkam, Tamil Nadu. The Indira Gandhi Centre for Atomic Research (IGCAR) is responsible for the design of this reactor.
- The construction started in the year 2004, Originally planned to be commissioned in 2012, the construction of the reactor suffered from multiple delays. As of August 2020, criticality is planned to be achieved in 2021 (now October 2022).
- The reactor is a pool-type reactor with 1,750 tonnes of sodium as coolant.
What is India’s three-phase nuclear power programme?
The Indian nuclear power programme, launched in 1954, envisaged a three-stage development of nuclear power generation from the country’s uranium and thorium resources.
- The first stage programme consists of setting up of pressurised heavy water reactors (PHWRs). PHWRs are natural uranium-fuelled, heavy water moderated and cooled. The uranium reserves in the country are adequate to support the first stage nuclear power programme of 10,000 MWe through PHWRs. In addition to generating power, PHWRs progressively make available plutonium as a by-product. The technologies for the reprocessing of plutonium from spent PHWR fuel and for fabrication of plutonium bearing fuels have been systematically established in India through research and development over the past several years.
- The second stage of the nuclear power programme consists of effective utilisation of plutonium in Fast Breeder Reactors (FBRs) which will provide the key to full utilisation of the country’s uranium resources and prepare the way for the long-term utilisation of the more abundant thorium reserves. FBRs enable generation of more fresh fissile material than is consumed for power production. With the deployment of FBRs, the depleted uranium and plutonium generated in the first stage will permit an additional power potential to the extent of 3,50,000 MWe.
- During the later part of the second stage programme, it is proposed to use thorium as blanket material in FBRs to generate U-233, another fissile material for use in the third stage programme based on U-233 fuelled reactor systems.
For basic learning –
- Stage-I: envisages, construction of Natural Uranium, Heavy Water Moderated and Cooled Pressurised Heavy Water Reactors (PHWRs). Spent fuel from these reactors is reprocessed to obtain Plutonium.
- Stage-II: envisages, construction of Fast Breeder Reactors (FBRs) fuelled by Plutonium produced in stage-I. These reactors would also breed U-233 from Thorium.
- Stage-III: would comprise power reactors using U-233 / Thorium as fuel.