India's Infrastructure Investment Trusts (InvITs) and REITs Poised for Massive Growth
India has emerged as a key market for Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs), with a projected AUM of $257.9 billion by 2030, according to Knight Frank India.
InvitsReitsInfrastructureInvestmentIndiaReal Estate NewsAug 31, 2025
In India, there are currently five REITs and seventeen InvITs listed on the stock exchange, with a combined market capitalization of USD 33.2 billion. The report highlights that InvITs have attracted significant investor interest, driven by the need to modernize and enhance the efficiency of infrastructure assets.
The total AUM of InvITs in India has reached approximately USD 73 billion in FY 2025, reflecting a major chunk of infrastructure investment destinations in the country. Knight Frank India projects that the AUM of InvITs could grow to 3.5 times to USD 257.9 billion by 2030. This growth will be propelled by higher allocations from institutional investors, increased participation of domestic pension and insurance funds, expanded foreign investment, and rising awareness among retail investors.
Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs) are investment vehicles that pool money from investors to own and operate income-generating infrastructure and real estate assets. While REITs primarily focus on commercial real estate such as office spaces, malls, and data centers, InvITs channel funds into operational infrastructure assets like roads, power transmission lines, renewable energy projects, and logistics.
Investments in India’s infrastructure have expanded rapidly in recent years, driven by the need to modernize assets and boost efficiency. The report notes that central government spending on core infrastructure surged from USD 12 billion in FY 2015 to USD 75 billion in FY 2025, a 6.2-fold rise, growing from 0.6% of GDP to 2.0% over the same period. This reflects a strong policy focus on infrastructure-led growth.
On the backdrop of this accelerating growth, the report states that InvITs have emerged as an effective financing tool, directing institutional and retail funds into operational assets, enabling capital recycling, and supporting timely infrastructure development. The potential for InvIT expansion in India remains significant across multiple infrastructure sectors.
In the roads sector, InvITs are the largest segment by value, comprising only 21% of operating NHAI toll assets, leaving ample scope for monetization. In renewable energy, despite installed solar capacity exceeding 98 GW, InvITs manage just around 2% of operational assets, with the government targeting 230 GW by 2030. In logistics, only approximately 39 million square feet of the 479 million square feet controlled by private operators is within InvIT structures.
Opportunities go beyond existing assets, with capacity expansions planned in roads, renewable energy, ports, airports, power transmission, and logistics driven by economic growth, urbanization, and industrialization. Overall, the InvIT market in India could reach approximately USD 258 billion by 2030, scaling existing sectors and bringing underrepresented asset classes into the fold.
The report identifies several strategies to unlock the next phase of InvIT growth:
• Expanding Retail Participation: Increasing awareness and accessibility of InvITs through targeted investor education campaigns, simplified investment processes, and inclusion in mainstream wealth management offerings.
• Hedging Currency Risk for Foreign Investors: Offering cost-effective currency hedging tools to mitigate forex volatility and encourage higher foreign capital inflows.
• Broadening Domestic Institutional Exposure: Raising exposure limits for pension and insurance funds and encouraging public sector financial institutions to participate more actively.
• Diversification of Sectors: Bringing new asset categories such as data centers, urban transport, and water infrastructure into the InvIT framework to broaden the investment base.
In conclusion, the report emphasizes that by deepening domestic institutional participation, expanding retail access, and attracting greater foreign investment through risk-hedging measures, India can secure a stable and diversified capital base for its infrastructure pipeline. In doing so, the country not only strengthens its position as Asia’s fourth-largest REIT and InvIT market but also moves closer to becoming a global leader in infrastructure investment.
Frequently Asked Questions
What are InvITs and REITs?
InvITs (Infrastructure Investment Trusts) and REITs (Real Estate Investment Trusts) are investment vehicles that pool money from investors to own and operate income-generating infrastructure and real estate assets. REITs focus on commercial real estate, while InvITs focus on operational infrastructure assets like roads, power transmission lines, and renewable energy projects.
What is the projected AUM of InvITs in India by 2030?
The AUM of InvITs in India is projected to grow to USD 257.9 billion by 2030, according to a study by Knight Frank India.
How has government spending on infrastructure in India changed?
Central government spending on core infrastructure in India has surged from USD 12 billion in FY 2015 to USD 75 billion in FY 2025, a 6.2-fold rise, growing from 0.6% of GDP to 2.0% over the same period.
What sectors are InvITs expanding into in India?
InvITs are expanding into various sectors including roads, renewable energy, logistics, data centers, urban transport, and water infrastructure.
What strategies are recommended to unlock the next phase of InvIT growth in India?
The report suggests expanding retail participation, hedging currency risk for foreign investors, broadening domestic institutional exposure, and diversifying sectors to include new asset categories.
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