National Highways Authority of India (NHAI) will be the flag-bearer of the government’s asset-monetisation programme with a plan to raise about Rs 40,000 crore through monetisation of its operational stretches over the next two years. 

Executives of NHAI have indicated that the disruptions in wake of COVID-19 had delayed some of its asset-monetisation plan, but with traffic fast returning to near normal levels now, about Rs 10,000 crore of road assets will be monetised by NHAI in the current year (FY22), and the exercise will pick up pace next year with doubling or tripling of the numbers in the next few years.

With the country in the firm grip of the second wave of the viral pandemic in April and May and subsequent restrictions on mobility and partial lockdown, tolling at national highways had nosedived. In a report released earlier, rating agency ICRA had estimated that sequentially tolling had fallen by about 10 per cent in April and close to 30 per cent in May. Thereafter, there has been marked improvement in traffic on highways, reaching 90 per cent of pre-COVID levels and has crossed that level too now. 

An NHAI executive has said that the entity is in touch with a clutch of investors, and soon bids will be invited for taking the operational NHAI project under the toll-operate-transfer (TOT) model. 

Under the TOT model, highway projects which have been operational for at least two years and which have been generating a steady stream of revenue are to be leased out to large-cap investors for carrying out operation and maintenance functions in consideration of the highest bid upfront concession fee. The investor recovers investment through tolls collected for a stretch over a period of concession spreading over 20 to 30 years. Once the cost with the agreed return is achieved, the road returns to NHAI.