In the first highway monetisation deal in the current financial year, the National Highways Authority of India (NHAI) will raise Rs 9,270 crore, with the letter of award issued to the highest bidder IRB Infrastructure last week for the 333.4 km highway stretch in Uttar Pradesh.
The monetisation took place through the Toll Operate Transfer (TOT) mode. It was the 117th round of monetisation via the TOT mechanism, which includes three road stretches – Lucknow to Ayodhya, Ayodhya to Gorakhpur and Lucknow to Sultanpur.
Other than TOT Bundle 17, bidding for another five bundles of highways is open. In the coming two to three months monetisation of some of them might be completed, Bids are open for ToT Bundle 18, 19, 20, 21 and 22. The total length of highways on offer on these five bundles is in excess of 845 km.
New target for NHAI?
WIth high investor interest in revenue generating road assets, the NHAI is now working with a target of Rs 40,000 crore as against the budget target of Rs 30,000 crore for monetisation. Of the total target for this year, Rs 15,000 crore each will come from ToT and Infrastructure Investment Trust (InvIT) route, rest will from project based financing.
For 2025-26 the NHAI has identified 24 road assets with a total length of 1472 km for monetisation through ToT and InvIT. In 2024-25 the highway builder raised Rs 28,724 crore through monetisation.
NHAI’s latest asset monetisation strategy
The Asset Monetisation Strategy of NHAI released in June has changed the strategy for monetisation through ToT. Every quarter NHAI was to offer three bundles for monetisation through this route. One bundle will be smaller with the potential to raise Rs. 2,000 crore, one medium that can bring in Rs. 5,000 crore and one large through which it can raise around Rs. 9,000 crore.
The NHAI and the government is currently sitting on Rs 15 lakh crore worth of highway assets that can be monetised, minister of road transport and highways Nitin Gadkari has said on many occasions.
Till date 11 bundles of highways totalling 2564 km have been monetised through ToT which has brought in Rs 48,995 crore. The number of 11 because some of the bids that were called till round 16 were not completed.
Under ToT the highest bidder who also meets the technical criteria gets the right to collect toll on the highways it has won concession for. The concession period is 20 years after which the asset reverts to the NHAI.
The asset monetisation receipts are ploughed back to the NHAI for capital expenditure. Currently monetisation is meeting 10% of the total budgetary resources of the Ministry of Road Transport and Highways (MoRTH)