Recent Insights about Indian National Highway Tolling System

The development of national highways and expressways requires a lot of capital. Even maintenance and management requires continuous flow of funds. So, countries across the world have devised their own asset management models.

In India, the NHAI, an autonomous highway agency of the Government of India, manages the development, maintenance, administration, and operations of national highways. It is vested with the power to mandate highway Toll charges. Here is all you need to know to understand India’s national highway tolling system.

The National Highways Authority of India (NHAI) invites bids for the construction and maintenance of national highways through different financial models such as the Engineering, Procurement and Construction (EPC), Build Operate Transfer (BOT), Build Own Operate Transfer (BOOT), and Toll Operate Transfer (TOT) models.

In case of a public-funded project, the NHAI collects the Toll through collecting agencies, which are invited through e-bidding. But for other projects concessionaires collect the Toll charges. The NHAI allows concessionaires or contractors to collect the Toll even though the project is under execution but completed up to 75%, where the users just need to pay for only the completed portion of that highway. The Toll Plazas collect until the concessionaries recover their investment. Once the maturity period arrives, the Toll charge is slashed to 40% of it.

Normally, the Toll collecting projects would be awarded for a stretch of 60 kilometres. The Toll charges are categorised based on the nature of vehicle. For commercial vehicles and public vehicles, there would be separate user charges. Also, there would be different charges for Locals and frequent commuters, which are welfare-oriented measures. For over loaded vehicles, the Toll collecting party can levy a penalty of 10 times the normal charge. Many more such measures have been taken by the NHAI to ensure smooth and seamless travel on national highways.

To make the journey through national highways much more convenient, the NHAI along with the National Payments Corporation of India (NPCI) has launched FASTag, a Radio Frequency Identification (RFID) Tag to collect Toll charges. This kind of Toll collection system helps in curtailing congestion at Toll Plazas. By having a FASTag on their vehicles, commuters need not wait more time at Toll plazas to pay Toll as the electronic sensors would enable the Toll plaza operators deduct the Toll without any human intervention.

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