InvIT Regulations – Corporate Governance Amendments

Introduction

Since their introduction to the Indian investment landscape as a separate asset class in 2014, infrastructure investment trusts ("InvITs") have emerged as an increasingly attractive vehicle for both domestic and foreign investors looking to leverage India's (developing – but severely underexploited) infrastructure sector.

As the market for this product has grown over time (with 14 InvITs registered with the Securities and Exchange Board of India ("SEBI") as at the time of writing this), the regulatory regime governing it – the SEBI (Infrastructure Investment Trusts) Regulations, 2014 ("InvIT Regulations") – has also undergone significant development, which has largely been fuelled, amongst others, by two factors – one, an increasing need for sophistication in the market as it matures (for instance, originally the InvIT Regulations permitted an InvIT to leverage only up to 49% of its asset base, which was increased in 2019 to 70% (subject to