Toll to be Delinked from road length

October 12, 2006

NEW DELHI, OCT 12: The government has finalised the toll policy for national highways, with the toll to be based on the cost of construction of roads. The toll will neither be uniform nor be based on the road length as suggested earlier.

Explaining the rationale behind the move, a government official said having high cost structures such as bridges in roads, there should be a higher toll to ensure project viability for the concessionaire.

The controversial issue of increasing toll by indexing it to 40% of the wholesale price index (WPI), a clause introduced in the new model concession agreement for roads (MCA), has also been resolved. The official said there would be 3% increase in toll rates annually.

The National Highways Authority of India (NHAI) is at present studying the impact of this on toll rates, and whether it would increase the viability of road projects for private players.

Tolling of two-laned highways is also likely to be introduced. The toll will be charged at 70% of the toll for four laned highways.

At present, such roads are not tolled, but the issue arose as NHDP-IV is dedicated to the construction of 20,000-km two-laned highways with paved shoulders, preferably on a BOT basis. It is hoped that this will make the phase viable for private players. The tolling policy will be given a final shape following a meeting of the committee of secretaries, which is scheduled shortly.

The policy would then be incorporated in the new MCA, a ministry of road transport and highways official said.