In order to raise more funds and attract long-term institutional investment, the government has approved monetisation of public funded operational national highway projects that are generating toll revenue for at least two years. The Cabinet Committee on Economic Affairs in August had authorised National Highways Authority of India (NHAI) to monetise the public funded highway projects which could result in funds in the range of Rs.80,000 to Rs.1 trillion initially.
Minister of State for road transport and highways, Mansukh L Mandaviya said that approval has been given for at least two years after start of operation through the Toll Operate Transfer (TOT) model. He added that the recycling of brownfield assets shall be done by inviting bids under the model in which foreign pension funds can also participate subject to the bidder satisfying the eligibility criteria required in the bid. The proceeds from such monetisation will go to the Consolidated Fund of India and are to be ring-fenced for utilisation by the NHAI.
The minister further elaborated that as of now, 75 operational national highway projects have been identified for monetisation under the TOT model. The aggregate length of these projects is around 4,500 km and their annual toll collection is around Rs 2,700 crore.
The TOT model provides an efficient Operation and Maintenance (O&M) framework requiring reduced involvement of NHAI in projects post construction completion. Further, the corpus generated from proceeds of such project monetisation could be utilised by the government to meet its fund requirements regarding future development and O&M of highways in the country.
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