India's Highway Toll Revenue Could Reach ₹2.5 Lakh Crore Annually, SBICAPS Report Reveals

India's national highway system is emerging as a significant revenue source with the potential to generate ₹2.5 lakh crore each year through toll collection, according to an in-depth analysis by SBICAPS. The report emphasizes the considerable untapped potential within the tolling infrastructure, with current revenues representing only a fraction of what is achievable. India’s national highway network alone, covering thousands of kilometres and intersecting key industrial hubs, already contributes substantial toll income; yet, much remains unexplored. Expanding toll monetization strategies, such as implementing advanced Toll-Operate-Transfer (TOT) models, could unlock vast additional revenues and contribute significantly to India’s infrastructure funding needs.

Currently, SBICAPS estimates that just about 30% of this total potential is realized, with key states like Maharashtra, Tamil Nadu, and Gujarat leading in toll revenue generation due to their extensive national and state highway networks. These states’ industrial strength and heavy traffic volume provide a reliable base for tolling, supported by recent advancements in toll management systems, including FASTag. The adoption of FASTag has increased revenue collection efficiency, setting the stage for even higher returns as India works toward a broader tolling framework.

The report also highlights potential growth opportunities in state highways, which are poised to benefit from increased toll collection. By tapping into state highways’ tolling capabilities, India could add a projected ₹3.6 lakh crore in revenue, complementing national highway earnings. Key states like Maharashtra, Karnataka, and Andhra Pradesh, with extensive highway networks, could see an upsurge in toll revenue by adopting similar monetization practices.

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With toll collection seen as a stable and scalable revenue source, the potential contributions to India’s public finances and infrastructure spending could be substantial. The revenue generated from tolls can play a crucial role in supporting large-scale infrastructure projects, road maintenance, and expansions, ultimately contributing to economic growth and improved connectivity.

Source: MoneyControl