Friday, January 23, 2009

Draft Kerala road development policy proposes fuel cess, levies

It includes north-south transport corridor, developing missing links of hill highway

Rs.54,000-crore outlay in the next 12 years


THIRUVANANTHAPURAM: The draft Kerala road development policy, released by Public Works Minister Mons Joseph here on Thursday, proposes introduction of a cess on fuel, levy on utilities and services on road sides and a deterrent fee on luxury vehicles to fund higher levels of road development over the next 12 years.

The draft, prepared by a task force headed by consulting transport planner Arun Herur, emphasises improvement of quality of existing roads, development of a north-south transport corridor and development of missing links of the hill highway and coastal roads. The draft policy estimates an outlay of nearly Rs. 54,000 crore for road development over the next 12 years, which works out to an annual requirement of about Rs. 3,000 crore during the first two years and Rs. 4,700 crore during the next 10 years. Of this, Rs. 550 crore is to be raised as additional revenue into the Road Development Fund through user fee and other levies. The draft proposes that the government amend the Road Development Fund Act to enable the fund to function and operate as an autonomous financial institution.


There is a potential to mobilise over Rs.100 crore to the fund a year if tolls are introduced on the improved network of State highways.

Currently, 10 per cent of the motor vehicle registration fee amounting to Rs.30 crore goes into the fund every year. This should be increased to 20 per cent. The provisions of the Highway Protection Act could be used to mobilise additional revenues. As development of highways results in enhancement of land values, 10 per cent of revenue earned from land registrations and transfers besides fee for granting changes in land use should be allocated to the fund.

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