Back against the wall, Nice reduces toll

Back against the wall, Nice reduces toll


Express News Service
First Published : 24 Dec 2008 03:57:00 AM IST
Last Updated : 24 Dec 2008 12:51:37 PM IST

BANGALORE: Public outrage and dwindling traffic on its peripheral road apparently have forced Nandi Infrastructure Corridor Enterprise Limited (NICE) to reduce the toll rates within a week after they were introduced.

Managing director, NICE, Ashok Kheny, announced reduction of toll on all sections of its peripheral road by around 25 per cent at a press conference here on Tuesday.

The new toll rates would come into effect from January 1, 2009. “Lower toll rates could generate more traffic and could result in an increase in the total toll. We are yet to know the net impact of the reduction. With IT/BT job layoffs and economic slowdown compelling people to take buses, no toll roads are making money,” Kheny observed.

However, he clarified that the reason for a cut in the toll was a request from Minister for Public Works C M Udasi, who, he said, received directions from Chief Minister B S Yeddyurappa.

Kheny maintained that the toll before the cut was not high. Unlike the national highways’ road upgradation project, NICE peripheral road was a Greenfield project.

He said: “NICE purchased land and constructed the road, which involved more investment than many other road projects where only upgradation or maintenance is required. The quality of the road also has to be considered. Travelling on this road saves time and fuel.

Some categories of toll are less than that on Mumbai- Pune Expressway.” It will be 14 years, in February 2009, since NICE signed the MoU for the BMIC and the company has not earned a single penny after huge investments, Kheny said.

To recover its investment, earn revenue and an interest on investment, NICE can collect toll for 40 years. This includes 10 years of construction period apart from the 30 years of concession period, Kheny said.

Government’s role?

The proposal from NICE, sent on November 15, to collect toll did not get any reaction from the state government.

The proposal got a deemed approval.

The Toll Concession Agreement signed in September 2000 by NICE and the then government had a clause that no reaction from the government within 30 days of proposal would be considered as a deemed approval.

However PWD Minister Udasi told to the New Indian Express on Tuesday: “We (the BJP Government) did not allow NICE to collect high toll. NICE has a right to collect the existing toll as it is in accordance with the Toll Concession Agreement signed in September 2000 by NICE and the then government. The present government could only request NICE to reconsider the toll rates.”