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NHAI may have to take an estimated loss of ₹1,822 crore due to the 40-day Covid-19 lockdown.
With goods traffic, both inter and intra-State allowed to ply from April 20, in case the toll suspension is revoked with effect from April 20, the loss could reduce to ₹1,181 crore, according to estimates by rating agency ICRA.
The revenue loss for NHAI-operated toll plazas is estimated at ₹821 crore, while the compensation to BOT Concessionaires under force majeure (political) event is estimated at ₹1,001 crore
The Ministry of Road Transportation and Highways has suspended tolling on all national highways, following the 21-day lockdown as per Ministry of Home Affairs guidelines, which now got extended by another 19 days up to May 3.
As per the Ministry circular dated March 25, the toll suspension would be treated as force majeure event and thereby results in a loss to NHAI.
Rajeshwar Burla, Vice-President, Corporate Ratings, ICRA, says, “There are around 570 operational toll plazas on the national highways across the country, which include both public funded (under NHAI) and projects under build-operate-transfer (BOT) (Toll) and toll-operate-transfer (TOT) mode."
For the BOT Toll and TOT projects, under force majeure event, the revenue loss is compensated in the form of extension in concession period. In addition, 100 per cent of operations and maintenance (O&M) and interest costs are reimbursed for the BOT Toll projects for the affected period; this would amount to 50-55 per cent of loss of revenue incurred by these projects. For projects that are public-funded (currently being tolled by NHAI through toll contractors), the suspension would result in a direct revenue loss for NHAI.
The loss to NHAI is only on account of disruption to operational toll road projects, the additional burden on account of compensation for under-construction EPC and HAM projects has not been considered in these calculations.
The total amount of toll collected through the 570 plazas in FY2019 stood at ₹24,396 crore averaging ₹66.84 crore per day, which was assumed to increase at 3 per cent thereafter. Drawing parallels with demonetisation in November 2016, ICRA note says that after the 24-day period toll suspension post demonetisation, NHAI offered compensation to the toll road SPVs under force majeure political clauses and incurred loss in the range of ₹650-700 crore.
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