Nivruti Rai Gets Six-Month Extension at Invest India

Invest India Managing Director and CEO Nivruti Rai has received a six-month interim extension until January 2027, amid scrutiny by auditors, internal committees and senior officials of the Commerce and Industry Ministry over several decisions taken during her tenure.

Government sources said the extension was granted as a short-term arrangement, allowing Rai to continue leading the organisation beyond her initial three-year term. She was appointed to the position in July 2023 after leaving Intel India, where she had served for 29 years.

The scrutiny has primarily focused on a Rs 14.16-crore consultancy contract awarded to global firm AT Kearney without documented approval, as well as the manner in which Rai’s remuneration was initially processed for tax purposes.

When contacted by The Indian Express, Rai rejected the allegations, maintaining that the consultancy contract had received the necessary approvals and attributing the tax-related discrepancy to procedural errors. She also said her pay revision had been approved in principle in 2023.

Why Nivruti Rai Received a Six-Month Extension

Rai was appointed Managing Director and CEO of Invest India on July 19, 2023, with a three-year tenure. At the time, the Commerce and Industry Ministry highlighted her experience as a global business and technology leader during her 29 years at Intel and her receipt of the Nari Shakti Puraskar.

However, as questions emerged over certain administrative and financial decisions taken during her first term, her continuation became a matter of scrutiny within the organisation and the ministry.

According to government sources, Rai received a six-month interim extension until January 2027. Sources in Invest India said she had not attended office for 10 days before the extension came through on July 20 and returned to work the following day.

Rai did not respond to questions about her second term. The Department for Promotion of Industry and Internal Trade (DPIIT), which oversees Invest India, also did not respond to requests for comment.

Invest India is a not-for-profit company established in 2009 under a public-private partnership model. It operates under the supervision of DPIIT, which comes under the Ministry of Commerce and Industry.

Rai took charge after her predecessor, Deepak Bagla, stepped down following a critical audit of his tenure by the Commerce Ministry.

AT Kearney Consultancy Contract Under Scrutiny

One of the main issues examined during Rai’s first term was the appointment of AT Kearney for a four-month organisational restructuring consultancy project worth Rs 14.16 crore.

Invest India records indicate that the organisation’s board was informed in April 2024 that DPIIT’s Financial Oversight Committee (FOC) had approved the proposal to hire the consultancy firm on October 11, 2023.

However, the minutes of the FOC meeting do not record such an approval. Instead, they indicate that the committee raised concerns about the proposed restructuring exercise and sought further clarification on its necessity, feasibility and scope.

Rai maintained that AT Kearney had been hired after following the required procedures and securing approval from the FOC. She said the approval was granted on November 14, 2023, through email and was duly signed by the competent authority.

However, Invest India’s emailed response to the FOC’s queries did not mention the approval Rai referred to.

The issue gained further attention when the FOC chairperson, an Additional Secretary in the Commerce Ministry, later examined a proposal to extend AT Kearney’s engagement by another six months at a cost of Rs 26 crore plus taxes.

An August 2024 report by the official questioned the proposed extension on several grounds, including the necessity of continuing the consultancy, the absence of clearly measurable deliverables and the justification for the estimated costs.

The report also noted that Invest India had not provided information regarding approval from the competent authority for the original appointment of AT Kearney on a nomination basis.

Rai confirmed that the proposal for the second phase of the consultancy was rejected. However, she said she could not recall the ministry’s observation regarding the absence of approval for the firm’s initial appointment, adding that the system escalated matters to her only when required.

Questions Over the Tendering and Selection Process

Invest India’s records also raised questions about the process used to select AT Kearney. The firm was chosen through a special limited tender based on subjective technical evaluation criteria.

The tender was approved by Rai in October 2023 and invited only three vendors. These vendors belonged to a Tier-II empanelment whose contract rates had already been withdrawn by Invest India in November 2022.

The selection process and the subsequent proposal to extend the consultancy engagement became part of the broader examination of the organisation’s financial and administrative decisions.

The concerns centred on whether the appointment had followed the necessary approval procedures, whether the selection criteria were appropriate and whether the proposed expenditure was supported by clearly defined outcomes.

Rai, however, maintained that the initial engagement followed the required processes and had the necessary approvals.

Auditor Flags Tax Treatment of CEO’s Remuneration

A separate issue emerged in December 2024 when an independent auditor’s report questioned the tax treatment of Rai’s remuneration.

The report found that more than a year after her appointment, her remuneration was being processed with tax deductions applicable to a consultant rather than an employee. It asked Invest India management to correct the financial statements and ensure compliance with the relevant taxation requirements.

In response, the organisation’s board said management had taken corrective action after identifying the discrepancy. Rai was subsequently reclassified as an employee.

Rai said she had paid any outstanding taxes along with applicable interest, while Invest India had paid penalties arising from the errors.

However, records show that Rai submitted vouchers to withdraw her salary as a consultant until at least October 2024.

When asked about the arrangement, Rai said she had followed the instructions given to her at the time and did not recall the details of how the payments had been processed.

What the Scrutiny Means for Invest India

The scrutiny of Rai’s tenure places attention on the financial oversight and administrative procedures followed by Invest India, an organisation involved in promoting investment into the country.

As a public-private partnership operating under DPIIT, Invest India is expected to follow appropriate governance, procurement and financial compliance procedures. Questions surrounding a major consultancy contract and the classification of executive remuneration therefore have implications beyond individual administrative decisions.

The AT Kearney case raises issues around approval documentation, tendering practices, expenditure justification and the measurement of consultancy deliverables. The remuneration issue, meanwhile, highlights the importance of correctly classifying employment arrangements and ensuring that tax treatment is consistent with applicable rules.

Rai has disputed the allegations and maintained that the consultancy engagement received the required approval, while describing the tax discrepancy as a process-related error. The concerns raised in official records and audit observations remain central to the scrutiny of her tenure.

Her six-month interim extension until January 2027 gives the organisation a temporary leadership arrangement while questions surrounding key decisions remain under examination. The developments also place renewed focus on the importance of transparent decision-making, documented approvals and financial accountability in institutions responsible for supporting India’s investment environment.