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India's highways authority said on Tuesday it plans to monetise up to $2.4 billion worth of road projects in the current fiscal year ending March through an infrastructure investment trust route as it looks for ways to reduce its massive debt.

The state-owned National Highways Authority of India (NHAI) has an outstanding debt of 3.2 trillion rupees ($38 billion) and is betting on leveraging assets through infrastructure investment trusts, or InvITs, to repay its loans.

"With this, the overall debt liability of NHAI is expected to further reduce to around 3 trillion rupees at the end of fiscal 2025," it said in a statement.

NHAI intends to monetize projects worth 150 billion to 200 billion rupees through an InvIT, the statement said, adding that the government had asked the authority to use the proceeds to retire its debts.

An InvIT is a kind of mutual fund that enables direct investment of money from individual and institutional investors in infrastructure projects to earn a portion of the income as returns.

Infrastructure investment trusts have gained popularity in recent years amid India ramping up its infrastructure spending to bolster economic growth.

The statement said that the company hoped to save about 10 billion rupees by retiring high-cost debt worth 157 billion rupees ahead of schedule.

The highways authority had earlier raised about 160 billion rupees by monetising its assets of 889 kilometres of toll roads.

The authority, which handles 983 toll plazas, has set a target of building 10,421 kilometres of new national highways in the current fiscal year, Nitin Gadkari, India's road transport and highways minister told parliament last week.

The authority plans to spend nearly 1.68 trillion rupees on road projects in the current fiscal year, largely funded through the federal budget, toll collections and monetisation of assets.

($1 = 83.9356 Indian rupees)