What is in news :  NITI Aayog has recommended various measures to boost monetization

Recommendations :

• Income Tax breaks to attract retail investors into instruments such as Infrastructure Investment Trusts (InvITs)
• Bringing such trusts within the ambit of the Insolvency and Bankruptcy Code (IBC) to provide greater comfort to investors
• Bringing in policy and regulatory changes to scale up monetisation instruments such as InvITs and Real Estate Investment Trusts (REITs) and expand their investor base
• InvIT and REIT route to monetise public assets such as highways, gas pipelines, railway tracks and power transmission lines

MAHITI FOR PRELIMS

REIT

• A REIT is roughly like a mutual fund that invests in real estate although the similarity doesn’t go much further.
• The basic deal on REITs is that you own a share of property, and so an appropriate share of the income from it will come to you, after deducting an appropriate share of expenses.
• Essentially, it’s like a group of people pooling their money together and buying real estate except that it’s on a large scale and is regulated.

INVIT

• It is like a mutual fund, which enables direct investment of small amounts of money from possible individual/institutional investors in infrastructure to earn a small portion of the income as return.
• InvITs can be treated as the modified version of REITs designed to suit the specific circumstances of the infrastructure sector.
• They are similar to REIT but invest in infrastructure projects such as roads or highways which take some time to generate steady cash flows.