Chennai bypass may be brought under TOT mode

New revenue model: Under the toll-operate-transfer mode, the NHAI will get a fixed sum while the concessionaires are supposed to collect user fee and maintain the road.   | Photo Credit: VEDHAN M

The 32-km-long Chennai bypass connecting Irumbuliyur with Puzhal may be included in the list of roads up for monetisation under toll-operate-transfer (TOT) mode. Under this model, concessionaires are given the right to collect user fees for a prescribed period under NH fee rules and maintain the road. This will be the second road in the State under this mode, if taken up.

Already the Madurai- Kanniyakumari NH has been given to a concessionaire under TOT. The National Highways Authority of India (NHAI), whose roads are being given under TOT mode, would get a fixed sum and it is up to the concessionaire to ensure he gets his investment back.

Sources in NHAI explained that this was a relatively new concept and was being tried out to bring in bigger and better companies that have the wherewithal to maintain roads better. “In build-operate-transfer mode, the concessionaire has to invest the money, construct the road and has to take the risk of waiting for land or delay in construction.

Whereas in this mode, the TOT contractor gets a completed road and does not have the hassles of land acquisition and construction. And since they need to get back their investment, they have to ensure quality services,” he said.

A former highways official, however, said that if the vehicle volume did not match the projection they would find it difficult to manage.

“In many cases, even in BOT if the traffic is not as envisaged, the entire collection goes to the escrow account from which the bank that lent towards the construction of the project, takes the amount due to it. In the case of TOT too, the amount paid to the NHAI is raised from the market at interest rates of around 10%. If the traffic volume is less then there is a chance it may go the BOT way,” he explained.

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Printable version | May 15, 2021 1:39:08 AM |

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