+
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. 

Related Stories

Gold Stories

Next Story
Real Estate

Peninsula Land launches 19 luxury villas in Pune

Pune’s residential landscape is witnessing a shift as premium homebuyers increasingly seek larger spaces, privacy and independent living options beyond high-rise apartments. Addressing this demand, Peninsula Land Limited, part of the Ashok Piramal Group, has launched AshokVillas, an exclusive collection of 19 premium furnished villas in Gahunje, Pune.The development combines the independence of a standalone home with the convenience and security of a managed residential community. Designed around low-density horizontal living, AshokVillas offers residents private spaces while providing acces..

Next Story
Infrastructure Urban

MyBranch Expands South India Network with 16 Workspace Centres

MyBranch has expanded its South India presence with a 50,000 sq ft flexible workspace network comprising 16 centres across 14 cities in Andhra Pradesh, Karnataka, Tamil Nadu and Telangana.The expansion reflects growing demand for flexible office infrastructure as businesses establish regional teams, satellite offices and operations beyond traditional metropolitan markets. MyBranch’s network spans Bengaluru, Coimbatore, Guntur, Hanamkonda, Hubballi, Hyderabad, Madurai, Mangaluru, Rajahmundry, Salem, Tirupati, Vellore, Vijayawada and Visakhapatnam, with a large office space in Chennai also und..

Next Story
Building Material

Walplast Launches Moisture-Resistant Gypsum Plaster Solutions

Walplast Products Pvt. Ltd. has expanded its HomeSure GypEx portfolio with the launch of GypEx MoistShield and GypEx Gold, two gypsum plaster solutions designed to address moisture-prone applications and improve plastering efficiency.The new products have been developed in response to the growing demand for faster construction processes, improved material performance and consistent surface quality. The solutions aim to simplify interior plastering while addressing specific application requirements across construction environments.“Through HomeSure GypEx MoistShield and GypEx Gold, we are exp..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code