Car pooling, passes put road collections in slow lane

Jan 13 2014, 00:16 IST
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Toll collections at the five entry points into Mumbai have been tepid over the past year Toll collections at the five entry points into Mumbai have been tepid over the past year
SummaryToll collections at the five entry points into Mumbai have been tepid over the past year

Toll collections at the five entry points into Mumbai have been tepid over the past year. Collections at these points rose just 2% year-on-year between January and October 2013 to R229.59 crore, data sourced from Maharashtra State Road Development Corporation (MSRDC) show.

While some of this is due to less traffic in a slowing economy, the usage of monthly passes too has gone up. Moreover, car pools are becoming common. Monthly passes are heavily discounted; for example, cars with monthly passes going through two booths — Airoli and Mulund — pay just R30 for a return trip while travelling through these points without a pass would cost three times as much.

“The number of vehicles using toll roads has been less than expected because of the slowdown. More drivers are opting for passes than we had anticipated,” says Jayant D Mhaiskar, MD of MEP Infrastructure Developers, which operates these toll roads. Mhaiskar confirms that traffic has grown at just around 3-3.5% against estimates of a higher 5-6%. “Typically, if GDP grows at 4% or 5%, traffic should grow at around 3.2-4%, given the correlation between GDP and traffic of 0.8,” explains Adil Zaidi, director (government), Ernst & Young.

At Mumbai's entry and exit points, cars constitute 55% of the traffic, with the rest accounted for by buses, trucks and multi-axle vehicles, which have not been impacted by the slowdown. Among the bigger vehicles, about 10%-15% traffic on these roads comes from city buses, an assured source of revenue. “City traffic is not generally linked to GDP because the traffic depends mainly on the distance between the residence and workplace and other local factors. Additionally, the concentration of business centres or housing colonies plays a big role in directing or diverting city traffic,” Zaidi points out.

Indeed, traffic has slowed despite the fact that toll rates for cars have remained unchanged for the last six years as permitted by MSRDC guidelines. However, rates for three categories of vehicles were raised by 15-16% in 2011 and the next revision for all vehicles is due in October 2014. For cars, rates will be raised by R5. According to the guidelines, MEPL is permitted to increase tariffs by about 15% every three years.

The elasticity of a change in volume of traffic to an increase or decrease in the toll will depend on the volumes, travel pattern of road users and the type of vehicle,

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