Govt May Pay Rs 42–45 Billion to Toll Operators Yearly
ROADS & HIGHWAYS

Govt May Pay Rs 42–45 Billion to Toll Operators Yearly

While highway users may benefit from the introduction of the annual toll pass, the financial burden on the central government to compensate private toll operators could reach Rs 42–45 billion annually, according to rating agency ICRA.
Passenger cars account for approximately 35 to 40 per cent of revenue for toll operators, with this proportion rising on highways near major metropolitan areas. The annual pass scheme, which offers flat-fee usage for frequent commuters, is expected to reduce direct toll collections from these vehicles, creating a shortfall for private concessionaires.
ICRA noted that in light of the Government of India's continued emphasis on infrastructure monetisation and efforts to attract private sector participation in toll road projects, it is likely that toll operators will receive adequate compensation. This support is expected to offset the revenue loss and prevent any material impact on the operators’ coverage metrics or debt servicing ability.
The assurance of government compensation is considered essential to maintain investor confidence and ensure continued participation in the toll-operate-transfer (TOT) and hybrid annuity model (HAM) frameworks that are central to India’s highway development strategy.

While highway users may benefit from the introduction of the annual toll pass, the financial burden on the central government to compensate private toll operators could reach Rs 42–45 billion annually, according to rating agency ICRA.Passenger cars account for approximately 35 to 40 per cent of revenue for toll operators, with this proportion rising on highways near major metropolitan areas. The annual pass scheme, which offers flat-fee usage for frequent commuters, is expected to reduce direct toll collections from these vehicles, creating a shortfall for private concessionaires.ICRA noted that in light of the Government of India's continued emphasis on infrastructure monetisation and efforts to attract private sector participation in toll road projects, it is likely that toll operators will receive adequate compensation. This support is expected to offset the revenue loss and prevent any material impact on the operators’ coverage metrics or debt servicing ability.The assurance of government compensation is considered essential to maintain investor confidence and ensure continued participation in the toll-operate-transfer (TOT) and hybrid annuity model (HAM) frameworks that are central to India’s highway development strategy. 

Next Story
Infrastructure Urban

Mount Invests Rs 250 Cr, Adds PUF & PEB Plants, 400+ Jobs

TUMKUR, Karnataka, January 8, 2025 - Mount Roofing & Structures Private Limited, one of India's  fastest-growing manufacturers in PUF and a leading solutions provider across Pre-Engineered Building  (PEB) and Polycarbonate sheets, simultaneously inaugurated its second fully automated continuous  Sandwich Panel manufacturing line and a new PEB manufacturing plant at its integrated campus in  Tumkur." The milestone expansion, part of a total investment of INR 250 crores, marks a significant  advancement in the company's commitment to engineered performance, manu..

Next Story
Infrastructure Urban

Titan Intech Strengthens UltraLED Push With Global LED Veteran

Titan Intech has announced the induction of global LED industry veteran Su Piow Ko to its Board of Directors, marking a strategic step in strengthening its UltraLED Displays roadmap and building globally competitive LED display solutions from India.The appointment aligns with Titan Intech’s ambition to position India as a hub for advanced, high-quality LED display manufacturing. With an increased focus on UltraLED Displays, the company aims to enhance technical governance, raise manufacturing standards and expand its presence across global markets.Su Piow Ko brings over three decades of inte..

Next Story
Infrastructure Urban

Dun & Bradstreet Flags New Growth Engines in India 2026 Outlook

Dun & Bradstreet has released its India 2026: D&B’s Perspective report, projecting a stable macroeconomic environment underpinned by fresh opportunities for productivity-led and inclusive growth. The report outlines how India’s next growth phase will be driven by digitised logistics, trusted data ecosystems, clean energy and rising city vitality.According to the outlook, India’s GDP growth is expected to reach around 6.6 per cent by FY2027, supported by resilient consumer demand and sustained public investment. Manufacturing is seen entering a new phase, moving beyond scale towar..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Open In App