The cess on HSD is expected to raise over Rs 4,000 crore, of which 50 per cent will go towards rural development and the balance will go to the central road fund. Of this 30 per cent will devolve to states and the balance will be used for expressway projects initiated by the National Highways Authority of India (NHAI). However, NHAI will get a smaller chunk of the road fund than expected.

It had expected most of the Rs 4,000 crore to be generated. The amount that will actually be made available for expressways will be less than Rs 1,000 crore, sincethe NHAI has projects other than the golden quadrilateral and four laning of the National Highways to worry about. State governments too will gain little. Going into the combined kitty is approximately Rs 600 crore, while the requirement of any one state alone will cross that figure.

Although the exact number of kilometres sought to be four or six-laned is currently being worked out by the NHAI, according to its own estimates, about 4,000 kms between the four metros needs to be converted into an expressway. According to sources in the ministry of surface transport, the north-south and east-west axis expressway projects, announced by the prime minsiter have been abandoned in favour of the quadrilateral project.

To that extent, the NHAI's need for funds has declined. In fact, for some months now, the IDFC has been stressing the fact, that the quadrilateral, estimated to cost Rs 25,000 crore over five years should be completed as funding was within striking distance. Expecting the fund to be in the region ofRs 4,000 crore, they felt that private sector participation apart, the government could well execute the project will cess funds.

According to IDFC sources, any addition to NHAI's corpus could be leveraged at least four times. If this can be done, even the Rs 1,000 crore will enable the NHAI to get quite a few projects off the ground.

However, the truncated allocation has disappointed several. Reacting to the Finance Minister's move, Ajit Gulabchand, chairman and managing director, Hindustan Construction Company (HCC) said, "Considering the size of the projects taken on, what will finally be made available for the expressways is too little. The Mumbai-Pune expressway alone cost Rs 2,000 crore."

Also considering the fact that the road concession agreement still had to be ironed out, Gulabchand feels that the private sector will restrict themselves to smaller projects, leaving the chunk for NHAI to fund.