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Ministry of Road Transport and Highways amends National Highways Fee (Determination of Rates and Collection) Rules, 2008 to promote digital payments
The Ministry of Road Transport and Highways (“MoRTH”), through the National Highways Fee (Determination of Rates and Collection) (Third Amendment) Rules, 2025, has amended the provisions governing collection of fee under the National Highways Fee (Determination of Rates and Collection) Rules, 2008 (“Fee Rules”). The amendment came into effect on November 15, 2025.
Previously, users entering a fee plaza without a FASTag or a valid, functional FASTag, as the case may be, were required to pay twice the user fee applicable to that category of vehicle. However, under the amended Fee Rules, if the user opts to make fee payment through Unified Payment Interface (“UPI”), such user will only pay 1.25 (one point two five) times of the applicable user fee as opposed to 2 (two) times the user fee when paying through cash. This amendment reflects MoRTH’s objective to promote digital payments, reduce congestion at toll plazas, and enhance transparency and efficiency in toll collection on national highways.
Source: MoRTH notification dated October 6, 2025
MoRTH introduces Annual Pass, uniform compensation and notifies the Standard Operating Procedure for concessionaire compensation
Introduction of Annual Pass to be treated as change in law
MoRTH, through its circular dated August 11, 2025 introduced the FASTag Annual Pass (“Annual Pass”), effective from August 15, 2025. The Annual Pass, priced at INR 3,000 (Indian Rupee three thousand) for Financial Year (“FY”) 2025-2026, entitles the holder to either 200 (two hundred) toll-free crossings or 1 (one) year of validity, whichever is earlier, irrespective of the fee leviable at each fee plaza. MoRTH clarified in the aforesaid circular that the introduction of the Annual Pass will be treated as a ‘Change in Law’ for the purpose of any contractual implications in Build, Operate, and Transfer (“BOT”) (Toll) (“BOT (Toll)”), Toll, Operate, and Transfer (“TOT”) and Infrastructure Investment Trust (“InvIT”) projects whose bid due date was prior to June 17, 2025.
Source: MoRTH circular dated August 11, 2025
Compensation mechanism for User Fee Collection Agencies notified
Subsequently, MoRTH, vide circular dated September 1, 2025 announced a uniform compensation mechanism for User Fee Collection Agencies (“UFCA”) and concessionaires operating under BOT (Toll) and TOT models. The mechanism aimed to ensure fair reimbursement for UFCAs following the introduction of the Annual Pass. A formula and mechanism for daily compensation to be provided to the UFCA has been set out in the aforementioned circular dated September 1, 2025. The daily compensation to be paid to the UFCA must be a direct function of the number of annual pass transactions, single side fare of car/jeep/van applicable on the day and ‘plaza constant’. The computation of ‘plaza function’ is as per a formula provided in the circular.
Source: MoRTH circular dated September 1, 2025
Standard Operating Procedures issued for disbursing the compensation to UFCAs
The National Highways Authority of India (“NHAI”), vide circular dated October 17, 2025, has now issued a standard operating procedure (“SOP”) for disbursing the aforementioned compensation to concessionaires on account of the introduction of the Annual Pass. The key features of the SOP are as follows:
- Execution of supplementary agreements: The General Manager (“GM”) (Technical) will execute a supplementary agreement with BOT project concessionaires, while the GM (Finance and Accounts) will execute the same with TOT and InvIT concessionaires. This supplementary agreement will set out the compensation mechanism payable to such concessionaires and a draft of the said supplementary agreement has been approved by NHAI.
- Entry-Exit pairs for computation: Closed toll plazas will be considered as entry-exit pairs for computing compensation.
- Data collection: The concerned GM (Technical) or GM (Finance and Accounts), as the case may be, will obtain Electronic Toll Collection (“ETC”) data from Indian Highways Management Company Limited. The ETC data will be used to compute the plaza constant in accordance with the supplementary agreement.
- Compensation computation: Compensation will be computed through a dedicated portal integrated with National Payments Corporation of India for Annual Pass transaction data.
- Payment release: Payments will be released weekly by Finance and Accounts division, NHAI Headquarter, with 1 (one) week buffer, and relevant Project Implementation Unit (“PIU”) will be notified for record-keeping; and
- Quarterly reconciliations: Quarterly reconciliations will be conducted by Finance and Accounts division, NHAI both for payments made and for the vehicle exemption data.
Source: NHAI policy circular dated October 17, 2025
NHAI discontinues Know Your Vehicle process for new FASTags
NHAI, through its circular dated October 30, 2025, had simplified the Know Your Vehicle (“KYV”) process for new FASTag users. Subsequently, on January 1, 2026, to enhance public convenience, NHAI announced its decision to altogether discontinue the KYV process for cars for all new FASTag issuances with effect from February 1, 2026. It is expected that this reform will bring significant relief to common road users who were facing delays even after FASTag activation due to post-issuance KYV requirements.
For existing FASTags, KYV will no longer be a routine requirement and KYV will only be required in specific cases where complaints are received, such as issues related to loose FASTags, incorrect issuance, or misuse of FASTags. While KYV will be discontinued, to ensure accuracy and system integrity, pre-activation validation norms have been strengthened. Some of the measures taken for strengthening these norms include:
- FASTag activation to be permitted only after validation of vehicle details from VAHAN portal;
- there will be no post-activation validation of the FASTag;
- where vehicle details are not available on VAHAN portal, issuer banks to validate details using the registration certificate before activation.
- FASTags sold through online channels will also be activated only after complete validation by banks.
Source: PIB press release dated January 1, 2026
Union Cabinet approves several major highway projects
During the course of this calendar quarter, the Union Cabinet Committee on Economic Affairs, chaired by the Hon’ble Prime Minister of India, has approved of several major national highway projects. Some of these approved projects have been listed below:
- Widening and strengthening of existing 2 (two) lane highway to 2 (two) lane highway with paved shoulder from 68.600 km to 311.700 km of NH-326 in the state of Odisha on Engineering, Procurement, Construction (“EPC”) mode: The total capital cost for the project is INR 1,526.21 crore (Indian Rupees one thousand five hundred and twenty-six point twenty-one crore), which includes a civil construction cost of INR 966.79 crore (Indian Rupees nine hundred and sixty-six point seventy-nine crore). It has been observed that this section of NH-326 has sub-standard geometry and that the existing road alignment, carriageway width and geometric deficiencies prevent safe movement of heavy vehicles thereby reducing freight throughput to coastal ports and industrial centres. By way of this upgradation, which will include geometric corrections removal of black spots and pavement strengthening, safe and uninterrupted movement of goods and passengers will be enabled. The work is targeted to be completed in 24 (twenty-four) months from the appointed date for each package, followed by a 5 (five) year defect liability/maintenance period.
- Construction of 6 (six) lane greenfield access-controlled Nashik-Solapur-Akkalkot Corridor in the State of Maharashtra on BOT (Toll) Mode: This project will be in the nature of a greenfield corridor from Nashik to Akkalkot and is proposed to be connected to the Delhi-Mumbai Expressway near Vadhawan port interchange, Agra-Mumbai corridor at Nashik at junction with NH-60 (Adegaon) and Samruddhi Mahamarg at Pangri (near Nashik). The proposed corridor will provide connectivity from west coast to east coast. The controlled greenfield corridor with close tolling will support average vehicular speeds of 60 km/h with design speed of 100 km/h. This will reduce the overall travel time to approximately 17 (seventeen) hours (from 31 (thirty-one) hours), while offering safer and faster connectivity for both passenger and freight vehicles. The total capital cost of this project is estimated to be INR 19,142 crore (Indian Rupees nineteen thousand one hundred and forty-two crore).
- Widening and improvement of existing 2 (two) lane carriageway in Kalibor- Numaligarh section of NH-715 to 4 (four) lane on EPC mode: The existing stretch has a configuration of 2 (two) lanes passing through densely built-up areas with a major part of the highway passing either through the Kaziranga National Park or along the southern boundary of the park, having restricted right of way (ROW) of 16 metres to 32 metres. This is further aggravated by substantially poor geometrics. During the monsoons, the area inside the park gets flooded leading to the movement of the wildlife from the park towards the existing highway. This results in frequent accidents and deaths of wild animals. To address this challenge, the project will include construction of an elevated corridor of about 34.5 km, for free and un-interrupted passage of wildlife, upgradation of 30.22 km of existing road and construction of 21 km of greenfield bypasses. These measures will decongest the existing corridor, improve safety, and enhance the direct connectivity between Guwahati, Kaziranga National Park and Numaligarh. The project will be developed on EPC mode with a total length of 85.675 km and total capital cost of INR 6,957 crore (Indian Rupees six thousand nine hundred and fifty-seven crore).
Source: PIB Press Release dated December 31, 2025; PIB Press Release dated December 31, 2025; PIB Press Release dated October 1, 2025
NHAI extends reimbursement policy for utility shifting in national highway projects to future projects
Delays in shifting utilities, especially electricity transmission lines, during the Detailed Project Report (“DPR”) stage have been among the key factors impacting timely execution of national highway projects under both hybrid annuity model (HAM) and EPC modes. To address this, MoRTH, vide circular dated February 11, 2021, had stated that supervision charges were to be paid directly by NHAI to utility owning agencies. However, the phrase ‘supervision charges’ limited the charges to direct supervision fees, while excluding several statutory and ancillary charges such as survey charges, processing fees, application fees, registration fees, and safety no objection certificate fees. The exclusion of statutory and ancillary charges from the estimated cost, along with the absence of a clear reimbursement mechanism, resulted in utility owning agencies deferring approvals and sanctions until such charges were settled.
To resolve this, NHAI, vide circular dated September 3, 2025, mandated inclusion of statutory and ancillary charges within supervision costs, payable by NHAI or PIUs to utility-owning agencies with respect to the on-going/existing projects. Thereafter, the charges for the identified utilities were recoverable from the next interim payment certificate of the concessionaire concerned. However, no guidelines were issued in respect of the upcoming/ future projects.
Therefore, NHAI, vide circular dated October 23, 2025, through its Executive Committee (“EC”) clarified the mechanism for reimbursement of statutory and ancillary charges for upcoming projects. The aforesaid circular states that statutory and ancillary charges including survey charges, shutdown charges, processing fees, application fees, registration fees, revenue loss, and safety no objection fees will be paid by NHAI directly to the utility owning agency. In cases where deemed availability is rejected by the regional power committee, NHAI will bear the shutdown charges, payable to the utility owing agency, as per actuals after due verification and certification by the concerned utility owning agency, independent engineer/authority engineer and NHAI representatives.
It is also clarified that in case the shutdown period is extended beyond the approved period, the excess shutdown charges will be adjusted against the forthcoming concessionaire payments.
Source: NHAI policy circular dated October 23, 2025
NHAI signs memorandum of understanding with Solar Energy Corporation of India as part of the affirmative steps to decarbonise the highways sector
In a major step towards vision of making India net zero by 2070, Solar Energy Corporation of India and NHAI have signed a memorandum of understanding for the installation of solar power plants along the elevated section of Package-1 (Delhi Portion) of the Delhi–Saharanpur–Dehradun highway (NH-709B) in Phase-1. This initiative marks a significant step towards cleaner and sustainable infrastructure development. By harnessing solar energy to power highway infrastructure, the project aims to reduce greenhouse gas emissions, minimize carbon footprint, and set a benchmark for integrating renewable energy with large-scale transport projects.
Source: PIB press release dated November 10, 2025
MoRTH issues SOP to streamline toll notification process and timelines
MoRTH has issued SOPs dated December 10, 2025 to streamline the process of issuing user fee notifications under the Fee Rules. A user fee notification is an official declaration, published in the Gazette of India, which specifies the toll applicable at a fee plaza. The SOP establishes a transparent and time-bound framework to ensure that all user fee notifications are issued in a timely and consistent manner. It defines clear roles and responsibilities for executing agencies, including NHAI, National Highways and Infrastructure Development Corporation Limited (“NHIDCL”), and State Public Works Departments (“PWDs”), and emphasises coordination with MoRTH to avoid delays.
A key feature of the SOP is the treatment of relaxation for locating the fee plaza under Rules 8(1) and 8(2) of the Fee Rules. Rules 8(1) and 8(2) of the Fee Rules stipulate that a toll plaza will be located no less than 10 km beyond municipal or local town area limits, and no other toll plaza on the same section of the national highway in the same direction will be located within 60 kms of it.
A relaxation is required when a proposed fee plaza is to be established: (a) within 10 kms of municipal or town limits; and/or (b) within a distance less than 60 kms from an adjoining toll plaza. To review and approve relaxation proposals, a toll committee has been constituted.
The SOP specifies the following points in relation to publication of user fee notification for different types of projects:
| Projects covered | Key features/ requirements |
| Newly awarded/to be
awarded projects |
1. The executing agency (NHAI/NHIDCL/State PWD) will apprise the toll committee regarding the requirement for relaxation under Fee Rules within 6 months from the appointed date. The executing agency will submit the justification, along with technical reasons, drawings and supporting documents to the toll committee.
2. For asset monetisation under TOT/InvIT, the toll committee will be apprised before the bidding process about any proposed relaxations to Rules 8(1) and 8(2) of the Fee Rules . 3. For any national highway stretch where bidding is still pending and requires relaxation under the Fee Rules, the proposal must be placed before the toll committee. |
| All projects whose construction is ongoing | For all the projects whose construction is ongoing any proposal for relaxation to be submitted before the toll committee upon 80% project progress or 6 months before likely date of completion, whichever is earlier. |
| BOT/TOT/ InvIT projects where concession period has expired/ going to expire or foreclosed/terminated and is to be converted into public funded fee plazas | The location of fee plazas in case of BOT/ TOT/ InvIT agreements is governed as per the respective concession agreement and therefore in cases where the concession agreement is foreclosed/ terminated or after the expiry of concession period, the user fee notification will be processed for publication such that the fee plaza can be operated on public funded mode under the new notification at the earliest. To clarify further, where the concession agreement is foreclosed/ terminated, fee notification proposal will be moved immediately upon the notice of termination to the concessionaire and where BOT/ TOT/ InVIT agreement is going to expire, fee notification proposal will be moved 6 months prior to the said expiration date mentioning the date from which new notification will be applicable. |
Source: NHAI policy circular dated December 10, 2025
NHAI to deploy Network Survey Vehicles across the country for over 20,000 km of national highways
With the objective of enhancing commuter experience, strengthening road asset management, and timely corrective measures for better upkeep, the NHAI announced on October 22, 2025 that it will deploy network survey vehicles (“NSVs”), a specialised tool with advanced sensors and data acquisition systems, across 23 (twenty-three) states, covering 20,933 (twenty thousand nine hundred thirty three) kilometre of national highways. These NSVs will collect, process, and analyse detailed road inventory and pavement condition data, including defects such as surface cracking, potholes, and patches for the insights.
Data collected through NSV surveys will be uploaded on NHAI’s AI-based Data Lake portal, where a dedicated team of experts will analyse the information to generate actionable insights. This data will be preserved in prescribed formats under the road asset management system, as mandated by Government of India (“GoI”) guidelines. Surveys will cover projects with 2 (two) lane, 4 (four) lane, 6 (six) lane, and 8 (eight) lane configurations conducted before project commencement and at six-month intervals thereafter. To operationalize this initiative, NHAI has invited bids from qualified entities.
Source: NHAI press release dated October 22, 2025
NHAI establishes Raajmarg Infra Investment Managers Private Limited to lead public InvIT framework
On November 20, 2025, NHAI initiated the formation of the Raajmarg Infra Investment Trust (“RIIT”) as a public Infrastructure Investment Trust (“InvIT”) to strengthen road asset monetization and widen investment avenues in national highway development, with first issuance for retail and public investors targeted for February, 2026. As part of this initiative, NHAI has incorporated Raajmarg Infra Investment Managers Private Limited (“RIIMPL”) as the investment manager for the proposed InvIT.
As part of its asset monetisation NHAI has previously monetised INR 48,995 crore (Indian Rupees forty eight thousand nine hundred ninety five crore) through the TOT model and raised INR 43,638 crore(Indian Rupees forty three thousand six hundred thirty eight crore) across four rounds of private InvITs. Over the next 3 (three) to 5 (five) years, around 1,500 (one thousand five hundred) kilometres of completed national highway stretches are expected to be introduced into this public InvIT. RIIMPL will implement strong governance and compliance systems aligned with Securities and Exchange Board of India (“SEBI”) (InvITs) Regulations, 2014, ensuring transparency, investor confidence, and high‑quality reporting standards.
Source: PIB press release dated November 20, 2025
NHAI receives SEBI’s in-principal approval of registration to RIIT as an InvIT
To strengthen NHAI’s asset monetisation program, SEBI has granted in-principle approval of registration to RIIT as an InvIT under the SEBI (InvITs) Regulations, 2014. As a part of the process to secure final registration, RIIT will be required to meet specific conditions over the next 6 (six) months.
Source: NHAI press release dated December 5, 2025
Retrospective application of the standard FIDIC bidding document for non-regular civil works on item rate (percentage) basis
On December 1, 2025, NHAI through its policy circular announced that the standard Fédération Internationale des Ingénieurs-Conseils (“FIDIC”) bidding document for non-regular civil works on item rate (percentage) basis will be applicable retrospectively from February 7, 2025. To ensure transparency, a copy of the standard FIDIC document has been annexed with the policy circular.
Source: NHAI policy circular dated December 1, 2025
NHAI introduces amendments to standard RFP document for DPR consultancy services
NHAI vide policy circular dated December 12 2025, introduced amendments to the standard Request for Proposal (“RFP”) document for DPR consultancy services on fixed basis, originally issued through circular dated June 14, 2024. The present circular updates and streamlines several RFP clauses to align with newer statutory, environmental, and procedural requirements. It consolidates changes issued through subsequent circulars in 2024 to 2025 and formally attaches the updated clauses as an annexure. These modifications aim to ensure uniformity, compliance, and improved clarity for DPR procurement processes. Some of the key modifications which have been made are tabled below:
| S. No. | Clause in terms of reference | Existing provision | Modified provision |
| 1 | 3.10 | Consultant must get approvals from Railway or Ministry of Environment and Forest, handle utility shifting, and prepare Land Acquisition documents. | Same as before but now it must obtain approval from National Mission for Clean Ganga (“NMCG”) as per Ministry of Water Resources, River Development and Ganga Rejuvenation dated notification dated October 7, 2016. |
| 2 | 3.12 | Consultants must obtain all project related clearances; clients provide supporting letters or fees as per the demand note issued by the concerned agencies. | Same, but also includes prior NMCG approval where needed. |
| 3 | 4 | Statutory clearances like forest/environment/Coastal Regulation Zone (“CRZ”) were required. | Expanded to all applicable statutory clearances including wildlife clearance, Taj Trapezium Zone (“TTZ”) clearance, Central Empowered Committee (of Hon’ble Supreme Court of India (“Supreme Court”)) (“CEC”) clearance and prior approval from NMCG. |
| 4 | 4.13 | Environment Impact Assessment (“EIA”) and Social Impact Assessment (“SIA”) to follow GoI/Asian Development Bank (“ADB”)/World Bank guidelines. | Must follow EIA 2006, MoRTH and Indian Roads Congress (“IRC”) norms, Ministry of Environment, Forest and Climate Control (“MoEF&CC”) expert committee report dated July 19, 2023 and supplementary report dated April 1, 2025, Supreme Court directions through an order dated January 19, 2021, and lender guidelines if project is funded through the loan. |
| 5 | 4.13.1 | EIA to be carried out in accordance with ADB’s Environmental Assessment Requirements of ADB 1998 guidelines for selected infrastructure projects 1993 as amended from time to time /World Bank Guidelines/GoI Guidelines, as applicable. | For projects proposed to be funded by MoRTH/its implementing agencies, EIA to be carried out in accordance with EIA notification of September 14, 2006, and its amendments thereafter, MoRTH circulars, IRC guidelines etc. There will also be compliance with the Report of the Expert Committee of MoEF&CC, vide office memorandum dated July 19, 2023, supplementary report dated April 1, 2025 issued in compliance with the order of the Supreme Court dated January 19, 2021 in the matter of National Highways Authority of India vs. Pandarinathan Govindarajulu & others[1].
Relevant guidelines of ADB/ World Bank/ JICA are to be followed if the project is funded through their loan for implementation. |
| 6 | 4.13.1 | Consultant to document baseline conditions relevant to the project with the objective to establish the benchmarks. | It has been clarified that the benchmarks will be established using primary data, secondary data, survey and investigation and modelling. |
| 7 | 4.13.1 | Consultant will do the analysis of alternatives incorporating environmental concerns. This should include with and without scenario and modification incorporated in the proposed project due to environment considerations. | Consultant will do the analysis of alternatives incorporating environmental concerns relating to topography, engineering, administrative, traffic, financial, carbon footprint, socio-economic, aquatic and territorial ecology, CRZ areas, etc. This should include with and without scenario and modification incorporated in the proposed project due to environmental and social considerations. |
| 8 | 4.13.1 | Consultant will identify and plan for plantation and transplantation of the suitable trees along the existing highway in accordance with IRC guidelines. | Consultant will identify and plan for plantation and transplantation of the suitable trees along the existing highway in accordance with IRC guidelines as well as in consultation with local forest department on the available right of way. Consultant will prepare green belt plan with item wise specification, quantity, cost, maintenance etc. |
| 9 | 4.13.4 | Consultant prepares standalone EIA reports as per ADB/World Bank/Agency. | Consultant prepares EIA and environmental management plan per EIA 2006, including full impact, alternatives, monitoring, cost–benefit, and disclosure. |
| 10 | 10.5 | Consultant submits list of clearances like Environment and Forest. | Consultant must list all applicable clearances such as Environment, Forest, CRZ, Wildlife, TTZ, NMCG, CEC and Ridge Management Board). |
Source: NHAI policy circular dated December 12, 2025
This Newsletter has been prepared by:
|
Ashish Suman |
Vishnu Sudarsan |
Kartikeya GS |
Ayan Sinha |
Swapnil Singh |
Swadha Singh |
For more details, please contact [email protected].
[1] SLP(C) No.8665-8667 of 2020
