Smart Tolling

NETC programme progressing at a fast pace

The central government has been ambitious in integrating advanced technologies with highway operations. Tolling has been a priority area for the government in the past few years, and a national electronic toll collection (ETC) programme was launched with the aim of facilitating faster movement of traffic on highways.

Indian Infrastructure takes a look at the developments in the ETC space…

Journey so far

The ETC programme, the flagship initiative of the Ministry of Road Transport and Highways (MoRTH), was rolled out in April 2016. Indian Highways Management Company Limited (IHMCL) was constituted as the implementing agency for ETC, with the National Payment Corporation of India (NPCI) functioning as the central clearing house. On September 1, 2017, the National Highways Authority of India (NHAI) achieved its first milestone in ETC by operationalising one dedicated FASTag lane at each toll plaza. In November 2017, the MoRTH mandated FASTags for all new passenger and goods vehicles sold after December 1, 2017. In October 2019, an MoU was signed between IHMCL and the GST Network (GSTN) for integrating the e-way bill system with FASTag. This has been done to overcome the existing challenge in the track-and-trace mechanism for the GST e-way bill system and enhance the efficiency of its monitoring. Finally, in February 2021, the ministry declared all lanes on national highway toll plazas as FASTag lanes.

Progress under ETC implementation

According to the NPCI, over 32.7 million FASTags have been issued as of April 2021. This is a significant jump from the 0.41 million that had been issued by March 31, 2017. The extent of FASTag penetration has been quite impressive and stands at 93 per cent (in value terms) as of February 2021, as of which date 794 toll plazas across the country have been equipped with ETC (including both national and state highways). Daily toll collection through FASTag has also reached Rs 1.08 billion, despite the ravages of the Covid-19 pandemic. In 2020-21 (including April 2021), the value of FASTag transactions at toll plazas stood at

Rs 1.49 billion, a substantial increase from the transaction volume of Rs 127.04 million in 2017-18. The increase in FASTag issuance has been mainly on account of the MoRTH’s mandate to original equipment manufacturers of issuing tags to vehicles applying for fitness certificates and national permits, and FASTags being made compulsory on toll plazas since February 2021. However, the transaction volume declined from 110.13 million in February 2020 to Rs 10.26 million in April 2020 due to toll suspension on national highways during the lockdown. It subsequently witnessed a sharp recovery till March 2021, before declining again in April 2021 when the second wave of Covid-19 hit the country. So far, a total of 31 banks, including ICICI Bank, the State Bank of India, the Axis Bank and the Punjab National Bank, have been associated with the programme.

In order to facilitate the availability of FASTags for ETC, the NHAI has taken various revolutionary steps in consultation with the Reserve Bank of India and NPCI. The authority has launched two mobile apps – MyFASTag and FASTag Partner. The FASTag Partner app will enable more than 6,000 dealers in the country to access a single platform and activate the FASTag at the time of delivery of the vehicle. Besides, a number of private banks have been offering FASTags to ensure easy availability to users. Seeking to provide hassle-free and convenient services to FASTag users linked to the NHAI prepaid wallet, IHMCL has announced the introduction of a missed call alert facility for NHAI prepaid wallet balance enquiry. The facility is free of cost and compatible with all mobile devices and operators. Further, NHAI recently decided to do away with the requirement of maintaining a minimum amount in the FASTag wallet.

Upcoming tolling technologies

The MoRTH has also finalised a global positioning system (GPS)-based technology for toll collection to ensure seamless movement of vehicles across the country. With this, the country is expected to become “toll booth-free” within the next two years. Under the new technology, the toll amount will be deducted directly from bank accounts based on the movement of vehicles. While all new commercial vehicles come with vehicle tracking systems these days, the government will come up with a plan to install GPS technology in older vehicles. The government expects to generate a toll revenue of Rs 1.34 trillion in the next five years through this technology. NHAI has already invited consultancy bids for the upcoming technology.

NHAI has also been actively looking at alternative ETC technologies such as smart cards with on-board units (OBUs), which allow a user to punch in a smart card and zip through the toll plaza. While there is flexibility in the payment mechanism associated with this technology, the high costs associated with OBUs can make it very expensive to deploy. Another noteworthy technology involves the recognition of licence number plates, allowing for automatic toll deduction. This technology is currently being deployed in some of the advanced economies around the globe. It offers flexibility in the payment mechanism and is linked to the user’s account. However, it requires substantial investments in high resolution cameras, making it costly to deploy. It also necessitates the use of image storage devices. Global navigation satellite systems and GPS can also be used to calculate the toll charge. This allows for free-flow lanes and eliminates heavy investments in toll-related infrastructure. However, the GPS unit is expensive and deployment of this technology is a challenge.

Outlook

The government has envisioned FASTag to be integrated with all state and toll plazas. To this end, the Telangana state government has initiated steps to make FASTags mandatory on state highways, while other states such as Uttar Pradesh, Maharashtra, Madhya Pradesh, Tamil Nadu, Haryana and Karnataka are also working in this direction. The government is also working on enabling payment of parking fees, fuel payment, electric vehicle charging fees and other related services through FASTag. The efforts are aimed at enhancing customer convenience. In a notable move, GMR Hyderabad International Airport Limited, in collaboration with the NPCI, has facilitated completely contactless parking for its customers using FASTag. The solution has led to an increase in the airport’s parking revenue by 30-40 per cent. Going forward, FASTag can also be used for contactless enforcement of the Motor Vehicles Act without stopping vehicles. Seeking to support its vision of “One Nation, One FASTag”, the government’s future roadmap also entails the integration of FASTag with the VAHAN portal, and GSTN and toll plaza transaction processing APIs.

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