Gadkari Proposes Market-Driven Flexibility in Highway Construction Model

Union Minister Nitin Gadkari on Tuesday suggested that the construction of highways under the Hybrid Annuity Model (HAM) could be made more flexible and market-driven to ensure timely completion. Currently, under HAM, the government provides 40% of the project cost to developers to initiate work, while developers cover the remaining costs.

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Gadkari questioned why the government should always provide 40% of the project cost even if contractors are willing to invest more than 60%. He emphasised that what is needed is project completion and that proposals should be market-driven. Speaking at an event, he stated, "I am of the view that infrastructure should be developed by the contractors."

GNSS-Based Toll Collection

The minister also highlighted that India's total toll collection will increase by at least Rs 10,000 crore with the implementation of the Global Navigation Satellite System (GNSS)-based electronic toll collection. This system aims to provide a seamless and barrier-free tolling experience on National Highways. Gadkari added, "GNSS will add another Rs 10,000 crore to the toll revenue and remove 99 per cent of the existing loopholes in the system."

Earlier this month, state-owned NHAI invited expressions of interest from global entities for implementing GNSS-based electronic toll collection. This move aims to eliminate physical toll booths on highways. The NHAI plans to integrate GNSS-based electronic toll collection within the existing FASTag ecosystem using a hybrid model where both RFID-based ETC and GNSS-based ETC will operate simultaneously.

Increased Toll Revenue

India's total toll collection reached Rs 64,809.86 crore in 2023-24, marking a 35% increase over the previous year. This surge surpassed government and industry estimates due to increased commercial traffic. Gadkari stressed the need for a transparent, qualitative, and leak-proof GNSS-based toll collection system to ensure no inconvenience for toll users.

NHAI Chairman Santosh Kumar Yadav noted that over the past decade, India's road network has expanded significantly. National Highways now carry over 70% of the country's freight and passenger traffic. He said, "Implementing GNSS will immensely contribute not only towards the growth of our economy but will also make barrierless tolling a reality for our citizens."

Gadkari also proposed that state-transport buses should be exempted from paying tolls on highways. This suggestion aligns with his broader vision of making highway travel more efficient and less burdensome for public transport.

The Hybrid Annuity Model currently involves a split where 40% of project costs are covered by the government and 60% by contractors. Gadkari's proposal aims to make this model more adaptable based on market conditions and contractor capabilities.

The introduction of GNSS-based toll collection is expected to revolutionise India's tolling system by reducing manual interventions and increasing efficiency. This system is anticipated to close most existing loopholes, ensuring higher revenue and smoother operations.

The NHAI's initiative to seek global expertise for GNSS implementation reflects its commitment to modernising India's highway infrastructure. This step is part of a broader strategy to enhance road safety, reduce congestion, and improve overall travel experience on national highways.

The focus on developing a leak-proof GNSS-based toll collection system underscores the government's commitment to transparency and efficiency in public infrastructure projects. This approach aims to minimise revenue losses and ensure fair tolling practices across India's extensive highway network.

India's growing road network plays a crucial role in its economic development by facilitating trade and mobility. The adoption of advanced technologies like GNSS is expected to further boost this growth by making highway travel more efficient and user-friendly.

The conclusion drawn from these developments indicates a significant shift towards modernising India's highway infrastructure through innovative financing models and advanced technology adoption. These measures are poised to enhance economic growth while improving travel experiences for citizens across the country.