India : Financing Highways

This report is designed to provide information and advice to the Indian Union and States Governments on the principles and practicalities for establishing a sound and sustainable system of highway financing. The report reviews the economic principles for establishing efficient and equitable road user charges (road pricing), and examines the potential mechanisms for charging road users. Present road taxation in India is assessed in the light of these considerations as is the levels of highway funding required to meet government objectives. The report reviews the potential contribution of private sector finance to the sector and assesses the present use of private finance and the alternative possibilities for utilizing the private sector in the financing and management of the network. The report also examines the need for an agenda of sector reform which addresses both the financial and institutional frameworks needed to achieve network sustainability and public acceptance of higher user charges.