Toll collections on India’s major roads fell by a sharp 20% year-on-year in the three months to December 2016, hit by the acute scarcity of cash, reports Shubhra Tandon in Mumbai.
Toll collections on India’s major roads fell by a sharp 20% year-on-year in the three months to December 2016, hit by the acute scarcity of cash, reports Shubhra Tandon in Mumbai. Collections for a clutch of 19 roads came in at R644 crore, down from R804 crore in October-December 2015, hurting the profits of several companies.
Managements said collections were not possible for nearly 25 days due to the shortage of cash. Had it not been for this disruption, collections would have been better given wholesale price inflation — to which toll rates are benchmarked — was at 5.25% on January 31, 2017, the highest in 30 months. Toll rates are revised annually using the WPI as the benchmark.
Roads that see more commercial vehicle traffic were affected the most. For instance, roads like Bijapur-Hungunda and Dhule-Palasner saw revenues fall by 25-30%. The Tumkur-Chitradurga road, which caters to the mining traffic in Karnataka, reported a 22% drop in toll collections, while the busy routes of Surat-Dahisar and Bharuch-Surat registered a fall of nearly 29% and 24.5%, respectively.
Rating agency Icra estimated the loss in toll revenues resulting from demonetisation for 115 roads at over R1,000 crore.