The centre intends to re-examine the model concession agreement (MCA) for the toll-operate-transfer (TOT) model of highway monetisation in order to increase its viability and encourage investor interest. The updated MCA is likely to be ready by April 2025.
Back in March 2024, the revised MCA for the model reduced the time interval between the two toll collection reviews from seven to five years. Additionally, under the revised MCA, if the collection is 5 per cent less or more than projected, it will lead to a change in the concession period.
Currently, infrastructure investment trusts (InvIT) are delivering better returns. However, in order to reach the ambitious target for highway monetisation in the upcoming National Monetisation Pipeline (NIP), both strategies, InvITs and the TOT model will be employed.
In tandem with this, the centre also plans to release an updated MCA for highways to be built under the build-operate-transfer (BoT) method, to balance the risk between the the government and the private developers.