Streamlined bidding and oversight help NHAI save over Rs 2,000 crore

NEW DELHI: The National Highways Authority of India (NHAI) has saved over Rs 2,000 crore by taking systemic measures, including timely bid out of contracts, eliminating three-month short-term contracts and doing away with provision that gave ‘windfall’ gain, to reduce what it pays as a charge to private toll collection agencies for carrying out this task.While the highways authority ended up paying 17.3% of toll revenue as collection charges to these agencies earlier, this has now been brought down to 9.3%.The highway authority engages private agencies to collect toll on stretches that are fully govt-funded while private builders collect toll on stretches built under BOT (build–operate–transfer)-toll mode. The cost of toll collection is defined as the difference between the total toll fees collected by private agencies and the amount remitted to NHAI.A top NHAI official said tolling costs had dropped from Rs 4,736 crore in FY 2023–24 to Rs 2,674 crore in FY 2024–25. As per data, tolling agencies collected Rs 27,417 crore in 2023–24, out of which Rs 22,681 crore was remitted to NHAI. During FY 2024–25, while the total toll collection increased to Rs 28,823 crore, the remittance to NHAI rose sharply to Rs 26,149 crore.The cost savings were achieved through a series of strategic measures, including timely bidding for contracts, discontinuation of old contract extensions, and close monitoring of ongoing contracts and remittances, according to NHAI.“We minimised short-term three-month tolling contracts and we have gone for only one-year contracts. We allowed only three premature termination requests per year and barred contractors who exited contracts prematurely from rebidding for the same plazas,” said an official. In addition, the removal of the deemed extension clause in contracts helped bring more certainty and fairness to tolling operations.Officials also said NHAI also introduced the “windfall gain” clause which provides for termination of tolling contract by giving a seven-day notice period where toll collection is more than 40% of the remittance in the past 15 days. This prevents excessive profit to tolling agencies. This provision was invoked recently on newly opened toll plazas on UER-II in Delhi and another on Delhi-Mumbai Expressway.“This is crucial in case of greenfield highways and expressways where there is no fresh vehicle data and we engage agencies on three-month contracts based on old projected traffic,” the official said.