India Plans New Per-Kilometre Toll System To Replace Fixed Fee Structure

The Ministry of Road Transport and Highways is mulling to develop a new toll collection framework that would allow highway and expressway users to pay charges calculated on distance travelled rather than the current practice of fixed toll payments, a new report said on Monday.

Transport Minister Nitin Gadkari has indicated that the new system could eliminate the need for traditional physical toll collection points.

Current System Vs. Proposed Plan

The present toll structure requires motorists to pay a standard fee determined by the total length of a highway project section, typically spanning 60 kilometres, according to the National Highways Fee (Determination of Rates and Collection) Rules, 2008.

"Under the new toll policy, the government is exploring ways to enable users to pay toll based on per km of usage of highways and expressways. In the existing system, users pay a fixed toll irrespective of whether they use the highway stretch for a few km or for the entire length," a senior government official, aware of the development, was quoted as saying by ET Infra.

Seamless Collection

The transformation builds upon India's successful FASTag implementation, which uses Radio Frequency Identification (RFID) technology for contactless toll transactions. The government is now advancing toward an upgraded collection mechanism powered by Automatic Number Plate Recognition (ANPR) technology to support the distance-based charging model.

"The idea is to ensure that there is no pilferage and revenue loss to the government," said the official, adding that the new system may incorporate satellite tracking technology as well.

ANPR-Based Barrier-Free System

The Ministry of Road Transport and Highways plans to deploy the ANPR-FASTag-based Barrier-Less Tolling System at designated toll locations initially. This technology will identify and charge vehicles through advanced ANPR cameras and FASTag readers without requiring stops at toll booths. Non-compliant users will receive electronic notices, with potential FASTag suspension and additional penalties for non-payment.

"This can be considered as a proactive initiative adopted by the government to adopt a barrier-less tolling system..it will result in seamless toll collection, reduce travel time, eliminate stoppage time at toll plazas, especially during peak traffic hours," said Jagannarayan Padmanabhan, Senior Director & Global Head, Crisil Intelligence.

Under the existing framework, private entities construct and maintain highways through concession agreements that permit toll collection for investment recovery. The proposed policy contemplates a centralised revenue distribution system to ensure concessionaire compensation remains intact despite the shift to per-kilometre billing.

"As the toll collection will become automatic without any intervention at the toll plazas, it is being contemplated that the revenue will be shared with the various concessionaires through a centralised pool by the central government, so that there is no revenue loss to them even if the user is being charged on a per km basis and not a fixed standard rate," the official said.

The new framework aims to eliminate revenue under-reporting by private operators, a concern under the current system.