How much does the Government earn through Toll on National Highways?

So how much does the government earn through user fee at toll plazas? Has demonetization affected government revenues from toll plazas?

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The National Highways Authority of India (NHAI) was set up by an act of Parliament and is entrusted with the responsibility of development, maintenance and management of National Highways. As of November 2016, there are 394 toll plazas on various National Highways across the country. As per the available data the government earned more than 6700 crore rupees through toll fee in 2015-16.

User Fee at Toll Plazas

NHAI enters into Concession Agreements for design, construction, operation and maintenance of highways through Build, Operate and Transfer (BOT) model. The Concessionaire builds NH stretches and during operation and maintenance of the said stretch collects and retains the toll (user fee). The operator shares a part of the toll revenue with the government.  In case of stretches developed by government or NHAI Funds, NHAI engages Operate, Maintain and Transfer (OMT) Concessionaire / User-Fee Collection Contractors.

What would be the impact of Demonetization on Toll collection?

Soon after demonetization was announced, the Ministry of Road Transport & Highways (MoRTH) suspended the user fee collection on National Highways from 09th November 2016 to 02nd December 2016. For almost a month, the toll fee collection was suspended on national highways across the country. The government also informed the Lok Sabha that the average toll collection per day is Rs. 51.59 crores from the toll plazas under the NHAI and hence that amount did not accrue to the government during the suspension period.

From the data shared by the government in the Lok Sabha, it looks like the revenue collection at various toll plazas in 2016-17, developed with NHAI funds, may stay at 2015-16 levels with little or no increase. The revenue collection at these toll plazas has seen a continuous rise every year with addition of new highways and greater traffic movement. From Rs 3447 crore in 2013-14 to Rs 4937 crore in 2015-16, the revenue collection increased by about 43% in three years. In 2016-17, the revenue collection is at Rs 3993 crore till December 2016. On the other hand, the revenue share from BOT projects has remained more or less constant at Rs 1800 crore.

UP accounted for more than 20% of the toll collection

Uttar Pradesh consistently accounted for more than 20% of the total revenue collected at toll plazas. The revenues from UP crossed Rs 1000 crore in 2015-16. Together, the five states of UP, Andhra Pradesh, Rajasthan, Tamil Nadu and West Bengal accounted for more than 60% of the total revenue collected in each of the past few years. Between 2013-14 and 2015-16, revenue collection crossed Rs 100 crore in twelve (12) different states. In 2016-17, the revenue crossed Rs 100 crore in 13 different states.

Featured Image: www.igovernment.in