FASTag will hasten road assets sale
Electronic tolling through mandatory FASTag from December 15 should help accelerate monetising road assets in favour of global investors under the toll-operate transfer (TOT) model.
HYDERABAD: India’s big push for electronic tolling through mandatory FASTag from December 15 should help accelerate monetising road assets in favour of global investors under the toll-operate transfer (TOT) model, said Asheesh Sharma, member (finance), the National Highways Authority of India (NHAI).
In the last few years, there were about 88-90 transactions where foreign investors had shown interest in buying Indian road assets, Sharma said.
Foreign pension funds and private equity funds were showing more interest in India’s highway road assets within the infrastructure space given the policy issues involved with various states in other infrastructure asset classes, he said.
“We had introduced TOT model three years back. We saw a lot of traction and we just awarded a bid of about Rs 5,000 crore to Cube Highways. All foreign players see great benefits if we are able to implement and convince them on electronic tolling as the way forward,” Sharma told ET in Hyderabad.
The NHAI executive said many foreign investors in the past few months had expressed satisfaction over the way India was giving a boost to electronic tolling.
“They don’t have to deal in cash. They want to deal in digital payments. So, it is a big convincing factor and satisfying reason for them to come and invest in India.”
The radio frequency identification (RFID) tags not just eases congestion at toll plazas across the country but also helps transparency in tolling, which has hitherto been predominantly in cash, to help NHAI determine the top and bottom lines of concessionaires.
Sharma said electronic tolling will go a long way in solving many problems that India was facing in the national highways construction. NHAI can now determine the exact losses of the concessionaires of BOT toll contracts against their claims that revenues went down owing to various factors including competing roads or law and order situation. NHAI has seen nearly 50% of collections coming from digital mode since the past few days.
“There will be more transparency and NHAI will know the actual losses suffered by the concessionaire and I hope there is no fudging of numbers. So it will add great deal of transparency and give a big boost to BOT toll projects going forward,” said Sharma.