Ahmedabad, Aug 23 (KNN) Nine  toll  road  projects,  awarded  through public  private  partnership  (PPP)  route  in  the  state  of  Gujarat, will be  affected  with  the  implementation  of  the  toll  exemption  policy  for  passenger  vehicles and  state transport buses, said the rating agency ICRA.

The  Government  of  Gujarat  (GoG)  has  exempted  car/jeep/van  category vehicles along  with  state  transport buses  from  toll  on  state  highways  starting  August  15,  2016.  It plans to compensate the revenue loss incurred from such toll exemption by way of monthly reimbursements for exempted vehicles.

Of the nine projects, three are promoted by L&T, two by IL&FS Transportation Networks Limited (ITNL),two  by  Welspun  Enterprises  and  one  each  by  Ranjit  Buildcon  Limited  and  M.S.  Khurana Engineering Limited. On two of the projects promoted by ITNL, toll is also being levied on two-wheelers, whereas for the remaining seven projects, it is being levied on cars along with other commercial vehicles.

The  Government  has  directed  the  concessionaires  to  set  up  exclusive  lanes  for  cars,  jeeps and  vans and  count  the  vehicles  using  automatic  vehicle  counters  (AVC).  Based on historical data, a formula would be derived to make necessary adjustments for exempted traffic, local users, traffic availing return journey and monthly passes.

For state transport buses, zero-value coupons would be issued which are required  to  be  produced  by  the  concessionaires  to  claim  the  compensation.  The  count  from  AVCs,  as derived  from  the  formula  in  case  of  private  vehicles,  together  with  coupons  for  state  transport  buses would be used to arrive at the compensation. The monthly bill for reimbursements is to be submitted by the 5th of every month and the Government of Gujarat intends to reimburse the amount by the 20th of every month.

Shubham Jain, Vice-President, ICRA, said “The actual traffic on a majority of these stretches is at around 60-65% of that of initial estimates.  Projects  for  which  there  is  a  revenue  share  payable  to  the Gujarat State Road Development Corporation Limited, have already sought deferment due to weak toll collections.

He further elaborated that toll exemption for private vehicles and state transport buses will be an additional burden on the cash flow and would affect the debt-servicing capability further.  Therefore, timely and adequate reimbursements from the State Government body remain critical from the debt-servicing point of view.”

Making the state roads toll free for passenger vehicles could result in increased usage of these stretches by these vehicles –either due to increased frequency of use or shift of traffic which was earlier re-routing through alternate routes to these stretches.  The  Government  has  clearly  specified  that  in  case  of  an unreasonable  rise  in  exempted  traffic,  it  will  restrict  itself  to  the  compensation  considering  reasonable growth rate of traffic. (KNN Bureau)