 "Users of nine highways to pay Rs 28,096-cr extra toll: CAG")
This, says a critique of the Comptroller and Auditor General of India (CAG), was due to National Highways Authority of India (NHAI) fixing a longer concession period. Of these nine, two were awarded to Reliance Infrastructure (Delhi-Agra and Pune-Satara), one to Larsen & Toubro (Beawar-Pali-Pindwara) and one to IRB (Jaipur-Tonk-Deoli).
NHAI considered tollable traffic, not the total assessed volume. This resulted, says CAG, in fixing of a longer concession period, leading to the extra charges on commuters and congestion for toll payers.
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These are part of its report on implementation of public-private partnership (PPP) projects in national highways. It audited 94 PPP projects, of 207 awarded till March 31, 2012.
Users on Varanasi-Aurangabad would have to pay an extra Rs 11,548 crore to Varanasi Aurangabad Tollway Pvt Ltd. Those using the Pune-Satara and Delhi-Agra stretches will pay an additional user fee of Rs 3,421 crore and Rs 753 crore, respectively, to PS Toll Road Pvt Ltd and DA Toll Road Pvt Ltd, both Reliance Infrastructure’s Special Purpose Vehicles (SPVs).
Charge on R-Infra
CAG also said toll revenue of Rs 303.6 crore was diverted by the concessionaires (Reliance Infra) in the Delhi-Agra and Pune-Satara projects as investment in Reliance Mutual Fund, rather than being spent on construction work. Asked to comment, an R-Infra spokesperson said, “The allegations are completely baseless and devoid of any facts. We have not violated any law or concession agreements. All investments and expenses are made in full compliance of the agreements signed with NHAI and lenders. The amounts invested in liquid mutual funds at any given point of time were Rs 3-5 crore and not the inflated figures alleged in the CAG report, and the same do not represent any diversion of funds, as the mutual fund accounts were of the SPVs themselves.”
Deployment of short-term liquidity in MFs was in the interest of the projects, as opposed to keeping funds idle in non-interest bearing accounts. The projects got delayed as NHAI could not provide the requisite clearances on time, and there is no question of any default by the SPVs, added R-Infra.
NHAI taken to task
The report said NHAI failed to achieve its target of 20 kilometres a day for widening and upgradation of national highways during 2009-10 to 2012-13. The best was 17.81 kilometres a day during 2011-12. This came down to 3.06 kilometres a day during 2012, despite sufficient funds.
The report also raised concern on differences in the total project cost (TPC) worked out by the concessionaires and NHAI.
In 85 of 94 projects, the TPC worked out by the concessionaire was 0.32 per cent to 223 per cent higher.
It was highest in project Bharuch-Surat BOT II (awarded to IDAA Infra Pvt Ltd), where according to the agreement the cost was around Rs 492 crore, while according to common loan agreement it was around Rs 1588.91 crore. In the project Jaipur Tonk-Deoli awarded to IRB-MRM, the TPC calculated by concessionare was Rs 1733 crore, while the agreement was around Rs 792 crore.
The ministry of road and highways admitted there are substantial differences between the TPC as concessionares worked out their own project cost based on market rates.
The lowest price difference was in the Aurang-Saraipalli project along then Odisha border, of Rs 4 crore. In 25 projects, the difference in cost was over 50 per cent.
The higher TPC worked out by concessionares allowed them to avail of a higher amount of borrowed funds and in case of termination because of a default by NHAI, the latter is liable to pay the concessionaire an amount equal to 90 per cent of debt due and payable.