Smart road tax technology could save upto Rs 60000 crore, improve GDP: Study

Each year, Rs 60,000 crore are lost in India due to fuel wastage from traffic congestion, slow speed of freight vehicles and waiting time at road tax plazas

Shishir Tripathi May 10, 2016 17:04:47 IST
Smart road tax technology could save upto Rs 60000 crore, improve GDP: Study

Each year, a staggering Rs 60,000 crore are literally burnt away in India due to fuel wastage from traffic congestion, slow speed of freight vehicles and waiting time at toll plazas, a study on operational efficiency of freight transportation by roads has found.

A new technology, however, could potentially help curb this wastage. The On Vehicle Smart Module (OVSM) system –a simple technology that combines the use of RFID, GPRS, GPS, smart card reader and 3-axis accelerometer to help address many challenges of road transport – “can be a game changer”.

Smart road tax technology could save upto Rs 60000 crore improve GDP Study

Representational image. Reuters

The device can be installed on all vehicles. Such technologies have been successfully implemented in countries such as Singapore and Switzerland, Germany, the Netherlands and the US for road tax collection and are being carried over for other challenges too. In Germany, which was one of the early adopters of the technology, close to 7 lakh vehicles were fitted with such technology way back in 2007.

The technology – to be facilitated by Association of MSMEs in Information Technology (AIM-IT) –is India’s first sectoral organisation for Medium, Small and Micro IT enterprises (MSMEs) which was founded by well-known technocrat Vinit Goenka in 2015.

Smart road tax technology could save upto Rs 60000 crore improve GDP Study

Figure 1 Conventional toll collection system (Before OVSM system implementation)

Talking about the OVSM, Nitin Gadkari, Minister for Road Transport and Highways and Shipping, stressed on the importance of ‘smart technologies’ such as OVSM for revamping the transport sector.

He said, “Information Technology should be used as a decision support system in strengthening, maintaining and upgrading national transport system. IT can help reduce cost and corruption and create better and more efficient infrastructure. The government is wholeheartedly adopting and integrating technology to increase the speed of implementation of infra projects and also to make it more efficient,"

"For example, our ministry has already started the modernisation, mechanisation and computerization of ports. Our aim for the next two years is to contribute at least 3 per cent growth of GDP in India,” Gadkari said.

Smart road tax technology could save upto Rs 60000 crore improve GDP Study

Figure 2 Automated Toll Collection (After OVSM system implementation)

OVSM was one of the top five recommendations which were selected after a nationwide campaign conducted by a special policy group - #ITforParivahan. This policy group was set up by IT task force members and renowned technocrats Dr. Mohandas Pai and Vinit Goenka as a platform to crowd source ideas to improve Indian infrastructure.

With an aim to make governance effective through public participation, the campaign invited suggestions from various stakeholders in transportation sector and also general public.

While explaining the advantages of adopting OVSM in India, Goenka said that India will be able to achieve and sustain its aim of 8-9 per cent of GDP growth over the next few decades only if it develops transportation network through adoption of IT.

Road transport has the largest share of GDP (4.9%) comparison to the other transport segments.

Emphasizing on the urgent need to integrate technology in the transport sector to make it efficient, economic and transparent, Vinit Goenka stressed, “There is a growing necessity for planned infrastructure and effective enforcement to ensure sustained growth of the nation and counter the challenges of increased vehicle population, emissions, accidents and urbanization.”

According to the report, the device that uses all the above mentioned technologies in combination with a few upgrades on the infrastructure side can bring simplification and build assurance in many procedures.

Below table shows the list of various problem statements that can be solved with the help of OVSM technology.

Smart road tax technology could save upto Rs 60000 crore improve GDP Study

Updated Date:

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