Citizens' Issues
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Delays at toll plazas cost the country about Rs60,000 crore a year
Toll charges which are supposed to be used to improve infrastructure across India are often squandered instead of being properly utilised. These charges have begun to hurt ordinary people.
 
Toll has become the second largest expense of the transport community only after fuel over the past decade, which over 374 toll plazas having sprung up across India to collect a charge on most of the national highway network. There are around one crore trucks and buses registered in India. Of these, truck with a national permit, on an average pays around Rs4 to 5 lakh per year in tolls alone.  The assumption was that the money goes into building national infrastructure. However, this is not reflected in state and central budgets. Instead, toll plazas only end up slowing down traffic, despite better roads. The average usage of truck has remained the same while costs have increased and margins are at an all-time low, says transporters.
 
A report by Transport Corporation of India TCI & IIM Kolkata in (2013) says “the slow truck speeds on highways and delays at toll plazas cost the country about Rs60,000 crore a year.”  In fact, things have reached a stage, where the transport industry is understood to have told the union minister Nitin Gadkari in October that they are willing to pay Rs14,000 crore upfront every year to stop this toll system. The Ministry of Road Transport and Highways is still thinking about it and has assured the transport industry of an answer by 15 December 2015 based the recommendations of a group set up by the ministry for this purpose. This followed the transport strike on between October 1 and 6 this year.  
  
The other big issue is about how accounts are maintained for collection of money through tolls. There is massive under reporting of vehicles that pay toll, with the result that concessionaire's are getting a longer tenure to collect tolls and recover costs. This is acknowledged by leading bankers as well and is evident in the fact that modern technology and smart cards are rarely deployed for collection. My analysis of data that I have gathered through RTI and government filings shows that road cost that can be recovered in five years is stretched to 20 because of such under-reporting. This is a serious cost to the nation and to ordinary people paying tolls.
 
 Consider this. On the one hand we see a year on year growth of 10% in the number of vehicles registered in India but the number of vehicles paying toll on highways still either are remaining same or has actually reduced on some toll roads. The most surprising part is NHAI is planning a road expansion exercise from four lanes to six lanes claiming that we need wider roads on exactly those tolled roads that have shown either reduced or stagnant toll collections over the past decade. Who is to question this data? 
 
It is not as though this jugglery is unknown. Government Audit departments have raised objections to the many irregularities in toll collection, traffic census, car per unit, toll calculation formula and toll rate hike.
 
Now let us look at Maharashtra in detail. You may be surprised to know that we have maximum number of toll plazas in the country (43) on national highways. We also have the highest toll rates and the highest road project costs with poor user facilities, shabby maintenance and unsafe road conditions as compare to other states. You can compare satara kagal project from Maharashtra and the Kagal to Belgaum project from Karnataka to get an idea of the stark difference. 
Then there is the issue of double taxation. Nearly 25 years ago the government decided to levy a cess on diesel and petrol to build road infrastructure. While this cess remains intact, the government has begun to extort more money from automobile users in the form of tolls. This is a double collection for the same infrastructure and it does not spare anybody, because the government is no longer obliged to provide an alternative route to those who do not want to pay toll.   
 
Here is a case study to showcase irregularities and violations on the Satara – Kagal project on NH 4 in Maharashtra. Read this case carefully, since it will give you lot of insight on how toll projects are managed.
 
1. No Final Completion Certificate: Till date this project has not been issued a Final Completion Certificate by any competent authority. (3500 days are over in last 10 years) This is a clear violation of clauses 6.1 (b), 16.4, 16.5 & 32.2 mentioned in Concession Agreement signed between NHAI and MSRDC dated 4th January 2002. In spite of all these violations, Project and Toll collection is still on. I have attached copies of provisional completion certificates issued in 2005 and 2006. (attached Annex I images 4) 
 
2. Illegal collection: As a result of this, toll collection done on this route after the expiry of the provisional certificate in 2006 (120 + 180 days) is completely illegal.
 
3. No increase in Traffic for 10 Years: Details of traffic census and average daily traffic published by MSRDC through contractor Raima Manpower Consultancy (sept 2014), survey copy of year 2003 does not show any increase in vehicular traffic on this project highway during 2003 – 2005 – 2015 (average 10000 vehicles per day). In each such project an average 5% increase per year in vehicle traffic is considered. So from 2005 by now the traffic count should have been double in 2015. (attached  Annex II images 3)
 
 
4. Actual Survey shows much higher traffic: The survey that AJS Scale International has done in Jan-Feb 2014 shows that the actual vehicle traffic on the Satara -Kagal highway had increased at 10% year-on-year and was 25000 vehicles per day. But this was not taken into account even in the current tender for 2014-2016. This shows the massive extent of under reporting of vehicle traffic and raises questions as to where the high toll collected on these highways are vanishing. 
 
 
5. Discrepancy in Collection figures shown by Toll operator, MSRDC and NHAI: Total toll collected figures till July 2015 published by MSRDC on their website were Rs.687 Crore & Rs.719 Crore. We could see no consistency in these figures either. I have analysed documents which show that there is a difference of almost Rs.30 Crore in two statements published by MSRDC for same period. 
 
Total toll collected figures until March 2014 provided by NHAI under Right to information (RTI) were Rs885 crore. And a statement submitted by Konark Infrastructure, the toll collecting agency, showed a figure of Rs601 crore from during the period 2005 to 2014. This is part of their Operations & Maintenance report submitted to the National Highway Authority of India (NHAI) and published on NHAI’s website. How can there be a difference of Rs284 crore in two statements for the same period? This is a pretty serious matter. More over MSRDC’s July 2015 figure is significantly lower than NHAI 2014 figures. This shameful under reporting in vehicle growth, I believe, would have caused a loss of at least Rs700 crore to exchequer.  And it is continuing.
 
 
6. Reduction in traffic hence no additional lanes required:- Average Daily traffic published by MSRDC (Maharashtra State Road Development Corporation) on their website for 2015 shows a reduction of 60% as compare to 2014 https://www.msrdc.org/site/pdf/News/635835399962016618-Traffic-Count-of-Kini-&Tashwade-Till-plaza.PDF
 
If one were to accept these figures that highway vehicular traffic is decreasing each year, then there should be no requirement for expansion and construction of additional lanes as is proposed by the government.  The question is, who is monitoring this fudging and loot and who is accountable? 
 
7. Standard carrying Capacity Vis a Vis present traffic:  The capacity figures used for determining the desired carriageway width in differing terrain w.r.t. traffic volume and composition as per IRC: 64-1990 is average 1300-1500 CPU (1000 vehicles) per lane per hour. Considering figures published for this project the current CPU in 2015 is not more than 150 (100 vehicles) per lane per hour.  More over this traffic has not increased in last 10 years and on the contrary decreasing year by year. Taking this point in to account requirement of additional carriageway/lane will never be required. (attached Annex VI pdf 1&2)
 
 
8. Inconsistent project cost: There is no consistency in actual project cost either. (attached Annex VII image 1)
 
 
9. Wrong charging: This is being designed in accordance of National Highways Act, 1956 (48 of 1956). As per National Highways Rules, 1997 clause 7(4) road user shall have the option to pay one and a half times on multiple / return journey in a day. In this project this facility to user is not offered. This is a heavy burden on part the user which they are facing since last 10 years. This is huge loss of tax payer’s money as well.
 
10. Bad road condition: Road and Environment conditions are very bad in District of Satara.
Let me document some other serious irregularities identified in this project.  First, Toll attendants don’t wear Uniforms, in violation of contract agreement and IRC standards.  At toll plazas situated at Tasawade and Kini, there are bouncers stationed at the toll plazas who threaten road user. This is in addition to issues like traffic bottle necks  shabby and unsanitary conditions and crowding of hawkers. Consequently, on weekends it takes more than 5-6 hours to cover a distance of 100 kms. 
 
 We are repeatedly told that toll collection is the standard global method of raising revenues for building road infrastructure and is an effective system. While that may be true globally, the Toll system adopted by India is different and lacks basic transparency and honesty in accounting. . 
 
(Sanjay Shirodkar is a Pune-based activist who has used RTI extensively to unearth details on Tolls and user taxes levied by various infrastructure companies. They run a Facebook page called Toll ek Jhol, where you can report Toll Related wrong-doing).

 

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COMMENTS

Aadish Joshi

4 months ago

One of the beautiful blogs I've ever read. Precise information and beautiful presentation.
Thank you so much.

bharati

1 year ago

Since people are already paying taxes, a govt's job is to provide roads. No citizen should have to pay tolls. Your tax has already paid the govt for this service. Yes I pay gladly for many things I personally do not use like many roads, free schooling, etc.: that is the price for living in a society, which has often given me many benefits.

Bhupesh

1 year ago

Affordable Video technology is available to count number of vehicles (along their registration number) passed through the video frames.

If there is will Govt can do random sampling of 24Hr period.

Gaurav Muley

1 year ago

after reading the title i was expecting , loss due to delay at toll plaza ( waiting time in the lanes for turn to pay toll amount) , delay in executing services and goods.the delay mentioned in the title is related to project completion.

Suresh Thadani

1 year ago

Brilliant, incisive research. Should be sent to Mr Modi without going through Nitin Gadkari

vnrao

1 year ago

though toll system is very inefficient lot of corruption and drainging of money loss revenue 60000 crores may be exaggeration

Anil R Kurup

1 year ago

We are paying toll to illegal auditors, and really this money doesn't ho to development or government. The toll continues even years after the tenure has completed. Ban tolls.

Ravindra Shetye

1 year ago

I fully agree that the cost of the time WASTED at the Toll Plaza for PAYING (NOT RECEIVING) the toll amount far exceeds the rationale and the MONETARY EVALUATION of the STUPID system that exists today.

Nifty, Sensex in a downtrend – Weekly closing report
Nifty may head towards 7,600. A close above 7,900 will be bullish
 
We had mentioned in the last week’s closing report that Nifty, Sensex were headed higher and that as long as Nifty stays above 7,800, it will be bullish. The Indian stock markets failed to stay above the threshold level of 7,800 and the major indices have been falling for most of the week. Friday was no exception and the Nifty fell by 1.05% to close at 7,781.90. Weekly losses of the major indices have been in the range of 2%. The weekly trends of the major indices in the markets are given in the table below:
 
 
On Monday, both the bellwether indices of the Indian equity markets opened on a firm note supported by hopes that the Goods and Services Tax (GST) bill will get passed during the winter session of parliament. However, concerns over the weak Asian markets, given the major fall in Chinese exchanges on Friday and a decline in country's industrial profits spooked investors in India. Furthermore, there were concerns ahead of the release of the upcoming macro-economic data like India's July-September GDP (gross domestic product) and eight core industries (ECI) numbers.
 
Lack of major triggers coupled with uncertainty over the upcoming US rate hike subdued the Indian equity markets as the major indices traded flat on Tuesday. Initially, both the bellwether indices of the Indian equity markets opened on a positive note following Monday's late night reforms initiated by the finance ministry along with market regulator and the Reserve Bank of India (RBI). Even a modest growth in the gross domestic product (GDP) for the second quarter, which showed a gradual recovery in the country's economy, cheered the markets. However, the gains were capped after a slowdown in demand was indicated by a lacklustre eight core industries (ECI) and purchasing manager’s index (PMI) data. Nevertheless, investors kept an optimistic outlook with the RBI announcing that it will maintain an accommodative stand on future rate cuts and that the economy is eventually limping towards a marked recovery.
 
Investors were hopeful that the European Central Bank (ECB) will announce a stimulus package during its next monetary policy meet slated for December 3, after latest data showed that Germany's GDP growth has slowed.
 
The Indian central bank on Tuesday kept its short-term lending and borrowing rates unchanged, in line with expectations, balancing its policy action between a comforting, 7.4% economic growth for the second quarter of this fiscal and a creeping inflation. In its fifth bi-monthly monetary policy review of the current fiscal conducted by Reserve Bank of India Governor Raghuram Rajan here, the repurchase rate at which short-term credit is extended to commercial banks was left unchanged at 6.75%. Accordingly, the reverse repurchase rate, or the interest paid by the central bank for short-term borrowings, also stood frozen at 5.75%. The statutory liquidity ratio and cash reserve ratio that banks have to keep in liquid assets and government securities also remained intact. The Reserve Bank of India also kept its overall growth projection for 2015-16 at 7.4% and said the inflation target of 6% in January next year as set out in the previous policy update also was within reach, albeit with a slight downside risk.
 
Rajan, who expressed concern over farm growth and retail inflation, remained neutral on services sector and saw some ray of hope with a pick-up in factory output growth, said: "We're seeing an economy that is well and truly in recovery, but with areas of concern." The governor also sought once again to nudge the commercial banks to cut interest rates.
 
Negative macro-economic data coupled with a bearish outlook by the Reserve Bank of India (RBI) and an impending US rate hike decision subdued Indian equity markets on Wednesday. Initially, both the bellwether indices of the Indian equity markets opened on a firm note following US markets positive close on Tuesday. However, the gains were capped ahead of the release of key US macro data on employment. Investors were concerned over a slowdown in demand which was indicated by lacklustre eight core industries (ECI) data and purchasing manager’s index (PMI) data.
 
News from abroad on economic data, in particular the US economy was negative, coupled with devastating Chennai floods added to the cautious outlook of Indian investors on Thursday. The US manufacturing Index in November contracted to the lowest level since June 2009 when the economy was caught up in the worst financial crisis in decades. The manufacturing index, also known as the purchasing managers index (PMI), fall to 48.6 in November after registering 50.1 in October. A reading above 50 indicates the sector is generally expanding, while a reading below that level indicates contraction. The ISM's new-orders index and the production index decreased while the employment index rose. The dismal data shows that a strong US dollar and a weak global economy continue constraining factory activities. Of the 18 manufacturing industries, only five reported growth which included non-metallic mineral products, food and tobacco. A business survey conducted by the institute showed continued concerns about less demand from China and European markets were affecting the US business. Disappointment over the ECB’s measures to stimulate the economy led to huge a sell-off in the European markets and a sharp decline in the US markets on Thursday. ECB’s Draghi announced a modest reduction in the deposit rate paid on reserves held at the central bank – which is already negative but falls further from -0.2% to -0.3% – and a six-month extension of the end-date for the ECB’s €60bn-a-month quantitative easing (QE) programme.
 
The Asian markets opened deeply in the red on Friday morning on the chances of a US rate hike, which depressed Indian equity markets on Friday. Floods in Tamil Nadu have impacted automobile and information technology (IT) industries' centres which are located there. Besides Chennai floods, the upcoming key US-based macro-economic data -- the non-farm payrolls figures are causing global volatility and impacting the Indian markets too. Even the slow movement on getting key economic legislations passed during the ongoing winter session of Parliament has had investors turning cautious. On Friday, Sensex and Nifty fell by 0.96% and 1.05% compared to Thursday’s close. Markets are expected to be in a downtrend next week, barring occasional intraday rallies.
 
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were:
 

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Odd, even number vehicles to ply in Delhi on alternate days
In a bid to curb rising pollution, the Delhi government on Friday decided that odd and even number vehicles will ply on alternate days in the capital from January 1, official sources said.
 
The decision, taken at a meeting presided over by Chief Minister Arvind Kejriwal, will not apply to CNG-driven buses, taxis and auto-rickshaws but will cover vehicles entering Delhi from other states too. 
 
The Delhi government has also decided to shut down south Delhi's Badarpur power plant, one of the coal-based plants of the NTPC.
 
The government will also launch a web based App which people can use to report about polluting vehicles in the capital.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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