The Big Picture: What Is NMP 2.0 and Why Should You Care?
Imagine India taking its existing highways, railway stations, airports, ports, power grids, and telecom towers and saying to private investors: "We built these. Now you operate them, maintain them, and share the revenue with us. We will use that money to build even more."
That is exactly what the National Monetisation Pipeline 2.0 does. Union Finance Minister Nirmala Sitharaman officially launched NMP 2.0 on February 23, 2026. Developed by NITI Aayog in consultation with infrastructure line ministries through extensive multi stakeholder consultations, this whole of government initiative draws its mandate from the 'Asset Monetisation Plan 2025 to 2030' announced in the Union Budget 2025 to 2026. It lays out a five year roadmap (FY 2026 to FY 2030) to monetise brownfield infrastructure assets across 12 sectors. The total estimated potential? A staggering ₹16.72 lakh crore, which includes ₹5.8 lakh crore in expected private sector investment, representing 39 percent of the total as direct private investment.
For context, the first version (NMP 1.0, covering FY 2022 to 2025) targeted ₹6 lakh crore and achieved 89 to 90 percent of that goal, realising about ₹5.3 lakh crore. NMP 2.0 represents a 2.6 fold increase in ambition and aligns with India's broader vision of achieving Viksit Bharat (Developed India) through accelerated infrastructure development. Finance Minister Sitharaman praised NITI Aayog and stakeholders at the launch, noting that NMP 2.0 sets proactive targets that surpass the benchmark established by NMP 1.0.
As an NRI investor, this is one of the most significant infrastructure investment visibility documents India has ever produced. NMP 2.0 explicitly targets global investors, including NRIs, and serves as an investor reference document for both global and domestic participation. It essentially gives you a sector by sector, project by project roadmap of where money will flow over the next five years.
Which Sectors Are Covered?
NMP 2.0 spans 12 key sectors with over 2,000 individual projects identified, giving investors unprecedented visibility into the pipeline:
| Sector | Notable Assets | Estimated Value | |---|---|---| | Highways, Multimodal Logistics Parks, and Ropeways | 21,300 km of toll roads, 15 MMLPs, 6 ropeways | ₹4.42 lakh crore (26% of total) | | Power | Transmission lines, generation assets, distribution networks | ₹2.76 to 2.77 lakh crore | | Ports and Shipping | Container terminals, berths, waterways, landlord port model assets | ₹2.63 to 2.64 lakh crore | | Railways | Station redevelopment, freight corridors, land parcels, InvIT eligible assets | ₹2.62 lakh crore | | Coal and Mining | Auction based monetisation, revenue sharing models | ₹2.16 lakh crore (coal), ₹1 lakh crore (mines) | | Petroleum and Natural Gas | Pipeline networks, storage | ₹16,300 crore | | Civil Aviation | Airport operations and terminal management | ₹27,500 crore | | Telecom | Tower infrastructure, fibre networks | ₹4,800 crore | | Urban Infrastructure | Housing, water supply, urban mobility | ₹52,000 crore | | Warehousing and Storage | Food, cold chain, public distribution assets | ₹10,000 crore | | Tourism | Heritage and tourism infrastructure | ₹1,200 crore |
How Does the Money Flow?
The ₹16.72 lakh crore breaks down like this:
- ₹5.8 lakh crore comes from private sector investment (this is where you as an NRI investor come in)
- ₹10.92 lakh crore flows as government proceeds, distributed as follows:
The government plans to reinvest these proceeds into new greenfield projects, minimising the fiscal burden of new infrastructure creation. NITI Aayog projects that about 70 percent of Central proceeds (roughly ₹3.2 lakh crore) will directly fund publicly funded infrastructure capital expenditure. The remaining 30 percent of Central proceeds (approximately ₹1.4 lakh crore) is expected to flow into PPP projects, leveraged at a ratio of 1:2 to generate approximately ₹4.2 lakh crore in total PPP investment. PSU proceeds of ₹1.6 lakh crore are expected to leverage approximately ₹4.9 lakh crore in additional investment.
Altogether, the ₹6.2 lakh crore from Centre and PSU proceeds could generate ₹12.2 lakh crore in total infrastructure investment. The projected GDP multiplier effect over 5 to 10 years? A whopping ₹40 lakh crore, driven by a capital expenditure multiplier of 3.25.
Year by Year Phasing
The government plans to ramp up monetisation gradually:
| Financial Year | Estimated Monetisation Value | |---|---| | FY 2025–26 | ₹2,49,493 crore | | FY 2026–27 | ₹3,26,435 crore | | FY 2027–28 | ₹3,46,312 crore | | FY 2028–29 | ₹3,68,852 crore | | FY 2029–30 | ₹3,81,208 crore |
Notice how the annual targets grow each year. This means more and larger opportunities will come to market as the programme matures. During the five year NMP 2.0 period (till FY 2029 to 2030), the government expects ₹10.8 lakh crore in monetisation inflow, with the remaining ₹5.9 lakh crore expected to flow after 2030.
The Monetisation Instruments: How Assets Get Transferred
This is not privatisation. The government retains ownership. Instead, operational rights transfer to private parties through several instruments. NMP 2.0 emphasises that these instruments allow for flexible investor profiling and control arrangements determined by sector, asset nature, timing, and operational requirements:
- PPP Concessions (Direct Contractual Instruments) such as Toll Operate Transfer (TOT) for highways, BOT (Build Operate Transfer) contracts for ports, and lease models for railways
- Infrastructure Investment Trusts (InvITs) that pool infrastructure assets and list units on stock exchanges (capital market instrument), including railway and road assets
- IPOs and FPOs of infrastructure SPVs and operating companies (capital market instrument)
- Private Placements for qualified institutional and individual investors (capital market instrument)
- Securitisation of future cash flows from toll roads, transmission lines, and similar assets (capital market instrument)
- Leasing of assets like warehouses, telecom towers, and port berths
- Land Based Development specifically for railways, ports, and telecom parcels
- Commercial Auctions for mines and coal blocks with revenue sharing
A Closer Look at Roads and Highways: The Largest Slice of the Pie
Roads and highways command the single largest share of NMP 2.0 at ₹4.42 lakh crore, representing 26 percent of the total pipeline. This sector encompasses 21,300 km of toll roads, 15 multimodal logistics parks (MMLPs), and 6 ropeways. The scope explicitly includes multimodal logistics parks and ropeways alongside traditional toll roads. Two instruments stand out in particular: NHAI bonds and highway focused InvITs.
NHAI Bonds: A Fixed Income Route Into Indian Roads
The National Highways Authority of India (NHAI) regularly issues bonds to fund highway construction and expansion. These bonds carry the backing of a government entity, which makes them attractive for NRIs looking for relatively stable, rupee denominated fixed income exposure to India's road infrastructure story.
Key things to know about NHAI bonds:
- NHAI issues both taxable bonds and capital gains bonds under Section 54EC of the Income Tax Act
- Section 54EC bonds allow you to invest long term capital gains (up to ₹50 lakh per financial year) and claim exemption from capital gains tax, provided you hold the bonds for at least five years
- NRIs can subscribe to NHAI bonds through their NRE or NRO accounts
- Interest earned on taxable NHAI bonds is subject to TDS for NRIs, but DTAA relief can reduce the effective rate
- These bonds are typically issued with maturities of 5 to 7 years and offer coupon rates that track prevailing government bond yields
Highway Focused InvITs: Earning From Toll Collections
Infrastructure Investment Trusts focused on highway assets let you earn a share of actual toll collections from operational roads. As NMP 2.0 feeds more highway assets into the market through Toll Operate Transfer (TOT) rounds and other concession models, the pipeline of assets available for InvIT packaging grows significantly.
Three highway focused InvITs that NRIs should track closely:
- IRB InvIT Fund holds a portfolio of toll road assets across multiple states and distributes quarterly income to unitholders
- NHAI InvIT (Highways Infrastructure Trust) is sponsored by NHAI itself and holds completed national highway stretches that generate toll revenue
- Raajmarg Infra Investment Trust (RIIT), an InvIT sponsored by NHAI, was listed on the Bombay Stock Exchange on March 24, 2026, providing a direct investment vehicle for highway monetisation. For FY26 specifically, NHAI aims to achieve ₹30,000 crore in highway monetisation targets.
A Closer Look at Ports and Shipping: India's Push Toward World Class Maritime Infrastructure
The ports and shipping sector represents one of the most dynamic segments of NMP 2.0 for NRI investors, valued at ₹2.63 to 2.64 lakh crore. India's major ports handle a massive share of the country's trade, and the government has laid out an ambitious vision to transform Indian ports into world class facilities suited to the requirements of the future economy of India, according to the Perspective Plans for Major Ports published by the Ministry of Ports, Shipping and Waterways.
The Landlord Port Model and Private Sector Participation
India's major ports are progressively adopting the landlord port model, where the port authority owns the land and basic infrastructure while private operators build, operate, and manage terminals and berths. This model sits at the heart of how NMP 2.0 monetises port assets.
The Perspective Plans document from the Ministry of Ports, Shipping and Waterways details a multi pronged financial strategy for port modernisation:
- Rs. 600 crores earmarked from internal resources for port development
- Rs. 5,023 crores channelled through private sector participation for various port modernisation initiatives
- BOT (Build Operate Transfer) contracts serve as the primary concession instrument, allowing private operators to build and run container terminals, bulk cargo berths, and other port facilities
- The government plans to reduce revenue shares in BOT contracts to attract more terminal operators and improve competitive positioning
- Tariff optimisation is a stated priority, with plans to reduce tariffs so that Indian ports can compete more effectively with regional rivals
How NRIs Can Access Port Investments
Port infrastructure offers NRIs several entry points:
- Direct FDI: 100 percent FDI under the automatic route is permitted in port and harbour construction and maintenance, making it straightforward for NRIs to invest in port SPVs and operating companies without prior government approval
- Listed port companies: Several major port operators and logistics companies with significant port exposure trade on NSE and BSE, accessible through the Portfolio Investment Scheme
- BOT concession participation: High net worth NRIs and NRI led investment groups can participate in BOT contract bids for terminal operations, either directly or through consortium arrangements
- Future port focused InvITs: As NMP 2.0 feeds more operational port assets into the market, new InvIT structures will emerge offering retail investor access to port monetisation
Investment Structures Available to NRIs
Infrastructure Investment Trusts (InvITs)
InvITs are like mutual funds for infrastructure. You buy units in a trust that owns and operates assets like toll roads, power lines, or airport terminals. The trust collects revenue and distributes it to you as a unitholder.
Why InvITs matter for NRIs:
- You can invest in listed InvITs on Indian stock exchanges (NSE, BSE) with zero restrictions
- You can also invest in unlisted InvITs under FDI norms with RBI approval
- InvITs have pass through taxation, meaning the trust itself pays no tax—only you pay tax on distributions
- Typical yields range from 8 to 12 percent annually
- You receive regular distributions from asset cash flows while maintaining liquidity
- NRIs are eligible for 100 percent participation in listed InvITs under FEMA regulations
Public Private Partnerships (PPPs)
The government partners with private firms to build, operate, and eventually transfer assets. For example, a private company might operate a port terminal for 20 to 30 years, collect revenue, and then hand it back to the government. This is a common structure for roads, railways, airports, and ports.
Toll Operate Transfer (TOT) Models
A private investor takes over an existing asset (like a highway), collects tolls for a fixed period, and then returns it to the government. This is common in road infrastructure and provides predictable returns based on traffic volumes and toll rates.
IPOs and FPOs
As PSUs divest stakes or infrastructure SPVs go public, NRIs can participate through stock market purchases via their Indian brokerage and demat accounts.
Private Placements
Qualified institutional and individual investors can participate in private placements of infrastructure securities.
Securitisation
Future cash flows from toll roads, transmission lines, and similar assets get packaged into investable instruments.
FDI Routes: Direct Ownership Opportunities
If you want to invest directly (not through InvITs), you can do so under India's FDI policy:
- Roads and highways: 100 percent FDI under automatic route
- Railways: 100 percent FDI under automatic route
- Airports: 100 percent FDI under automatic route
- Ports: 100 percent FDI under automatic route
- Power: 100 percent FDI under automatic route
- Telecom: Up to 49 percent FDI under automatic route
Tax Treatment for NRI Investors
InvIT Distributions
- Pass through taxation: The InvIT itself pays no corporate tax. You only pay tax on what you receive.
- TDS (Tax Deducted at Source): The InvIT will deduct 5 to 10 percent TDS on interest and dividend payouts before sending you the money.
- Long term capital gains: If you hold InvIT units for more than 2 years and sell at a profit, you pay 20 percent LTCG (Long Term Capital Gains) tax, with indexation benefit.
- Short term capital gains: Gains within 2 years are taxed at your slab rate (up to 30 percent).
Repatriation of Funds
- You can repatriate 100 percent of your investment proceeds and profits back to your country after paying applicable taxes.
- There is no cap on repatriation for NRIs under FEMA (Foreign Exchange Management Act) regulations.
- Use your Liberalised Remittance Scheme (LRS) limit of $250,000 per financial year for portfolio investments.
Double Taxation Avoidance
India has Double Taxation Avoidance Agreements (DTAAs) with over 80 countries. If you are a resident of one of these countries, you can claim relief to avoid paying tax twice on the same income—once in India and once in your country of residence.
Regulatory Framework for NRI Investors
FDI Policy
FDI in most infrastructure sectors operates under the automatic route with up to 100 percent foreign investment permitted, as per the extant DPIIT (Department for Promotion of Industry and Internal Trade) guidelines. NRIs investing on a repatriation basis fall under FDI norms. Always verify the current sector specific caps and conditions through the latest DPIIT consolidated FDI policy circular before committing capital.
FEMA Compliance
Every NRI investment in India flows through the Foreign Exchange Management Act framework. Whether you buy InvIT units, participate in a private placement, or invest in a PPP concession, your funds must move through proper NRE or NRO banking channels. Repatriation rules differ based on the account type and investment route.
SEBI Regulations for InvITs
SEBI regulates InvITs in India. NRIs can invest in listed InvITs, but must hold a valid PAN, a demat account with a SEBI registered depository participant, and comply with KYC norms. Check with your broker whether they support NRI InvIT transactions, as not all platforms handle this smoothly.
RBI Norms
RBI oversees the foreign exchange side of NRI investments. For large ticket PPP participation or private placements, you may need specific RBI approvals depending on the structure and sector.
How NMP 2.0 Affects Listed Companies You May Own
If you hold shares in Indian infrastructure companies, NMP 2.0 creates new business opportunities:
- Road operators like IRB Infrastructure Developers, Ashoka Buildcon, and Dilip Buildtec will bid for toll operate transfer contracts
- Airport operators like GMR Infrastructure and Adani Airports will expand terminal leases
- Port operators like Adani Ports and Cochin Shipyard will take on new berth concessions
- Power companies will invest in transmission and distribution assets
- Telecom firms will upgrade tower and fibre infrastructure
- Railway and logistics players will benefit from station redevelopment and freight corridor monetisation
- InvIT sponsors will likely launch new trusts or expand existing ones to absorb monetised assets
- Construction and engineering firms will see order books grow as monetisation proceeds fund new greenfield projects
Practical Steps for NRI Investors
1. Open the right accounts first. You need an NRE or NRO bank account, a PIS (Portfolio Investment Scheme) permission from RBI (if buying listed securities), and a demat account with a SEBI registered broker to participate in capital market instruments like InvITs.
2. Get a valid PAN. Even as an NRI, you need a PAN (Permanent Account Number) to invest in Indian securities and InvITs.
3. Complete KYC compliance. Your broker will require KYC documentation. This typically includes proof of identity, address, and source of funds.
4. Watch for specific opportunities. As NMP 2.0 rolls out, NITI Aayog and Invest India will conduct investor roadshows and outreach. Follow announcements from the Ministry of Finance, NITI Aayog, and line ministries for new opportunities.
5. Diversify across sectors. With 12 sectors and over 2,000 projects, you have ample opportunity to build a diversified infrastructure portfolio rather than concentrating in a single sector.
6. Understand asset specific risks. Each sector carries different operational, regulatory, and market risks. Do your own due diligence before investing.
7. Monitor governance. The Core Group of Secretaries on Asset Monetisation provides high level oversight. Track their progress reports and ministry announcements to stay informed.
The Economic Impact: Why This Matters for Your Returns
NITI Aayog projects that NMP 2.0 could boost India's GDP by ₹40 lakh crore over 5 to 10 years through:
- Accelerated capital expenditure (capex) in infrastructure
- Improved operational efficiency of existing assets
- Job creation and economic multiplier effects
- Faster movement of goods and people
- Enhanced competitiveness of Indian ports, airports, and logistics networks
Key Takeaways for NRI Investors
- Scale: ₹16.72 lakh crore in monetisation potential across 12 sectors over 5 years represents unprecedented visibility into India's infrastructure pipeline
- Track record: NMP 1.0 achieved 89 to 90 percent of its target, demonstrating execution credibility
- Accessibility: NRIs face no sector specific restrictions and can participate through multiple instruments—InvITs, PPPs, FDI, and capital market routes
- Returns: Typical InvIT yields of 8 to 12 percent, combined with potential capital appreciation and GDP growth tailwinds, offer attractive risk adjusted returns
- Governance: High level oversight by the Core Group of Secretaries on Asset Monetisation ensures programme credibility and transparency
- Alignment: Investing in NMP 2.0 aligns your portfolio with India's Viksit Bharat vision and long term infrastructure development goals