NHAI invites bids for fourth TOT bundle, plans to raise Rs4,200 crore

The National Highways Authority of India (NHAI) has invited bids for its fourth bundle of Toll-Operate-Transfer (TOT), looking to raise around Rs4,200 crore. The ministry of road transport and highways is working aggressively on its asset monetisation programme, as it creates a pipeline of projects that can be monetised.

Bids were invited on Wednesday for seven projects of cumulative length of 401 kilometres, in the states of Punjab, Haryana, Rajasthan, Maharashtra, Madhya Pradesh and union territory Jammu and Kashmir, for a concession period of 30 years, and base value of Rs4,170 crore.
TOT 4 could be the last round of TOT auctions to be conducted in the current financial year, while bids for TOT 3 for raising around Rs5,000 crore are due later this month.
The government introduced the TOT model in 2016 for monetisation of publicly-funded highways. Under this, investors make a one-time lump sum payment in return for long-term toll collection rights.
The highways ministry has been working aggressively on its asset monetisation program, as it creates a pipeline of projects that can be monetised over the coming years.
TOT 4 could be the last round of TOT auctions to be conducted in the current financial year, while bids for TOT 3 for raising around Rs 5,000 crore are due later this month.
While the government's maiden round of monetisation of road assets fetched around Rs10,000 crore against the base value of Rs6,258 crore, the second tranche of TOT auctions had to be scrapped in February this year amidst tepid response from investors.
NHAI has set itself the target of raising around Rs9,000-10,000 crore in FY 19-20. The ministry of road transport and highways has also circulated a cabinet note for allowing flexibility in the concession period from 30 years at present to around 15-20 years.
Union minister of road transport and highways Nitin Gadkari has also said in the past that TOT projects should be offered in smaller bundles to attract small investors.