Central Road Fund (Amendment) Bill, 2017

The Lok Sabha has passed the Central Road Fund (Amendment) Bill, 2017. The Bill seeks to amend the Central Road Fund Act, 2000, through which the cess levied and collected on high speed petrol and diesel is distributed for development of rural roads, national highways, railways, state roads and border area roads.

Features of the Bill:


Inclusion of inland waterways: The Bill defines national waterways as those that have been declared as ‘national waterways’ under the National Waterways Act, 2016. Currently, 111 waterways are specified under the 2016 Act.


Utilisation of fund: Under the 2000 Act, the fund can be utilised for various road projects including: (i) national highways, (ii) state roads including roads of inter-state and economic importance, and (iii) rural roads. The Bill provides that in addition to these the fund will also be used for the development and maintenance of national waterways.


Powers of central government: Under the Act, the central government has the power to administer the fund. The central government will make decisions on the: (i) investments on national highways and expressways projects, (ii) raising funds for the development and maintenance of national highways, and rural roads, and (iii) disbursement of funds for national highways, state roads and rural roads. The Bill provides that central government will make all the above decisions for national waterways as well.


Allocation of cess: Under the Act, the cess on high speed diesel oil and petrol is allocated towards different types of roads. The Bill seeks to decrease the allocation of cess towards the development and maintenance of national highways from 41.5% to 39%. It allocates 2.5% of the cess towards the development and maintenance of national waterways.


About Central Road Fund:


The Central Road Fund was established by the government as per the Central road fund act 2000 to fund the development and maintenance of National Highways, State Highways and Rural roads.


In order to mobilise the fund, the Central Road Fund Act 2000 proposed to levy and collect by way of cess, a duty of excise and duty of customs on petrol and high speed diesel oil. The fund is utilised for the development and maintenance of National highways, State roads, Rural roads and for provision of road overbridges/under bridges and other safety features at unmanned Railway Crossings.