Heterogeneous traffic consists of vehicles of different categories with widely varying dimensional and operational characteristics. The interaction between moving vehicles under such traffic condition is highly complex in nature and is the resultant of the associated random variables like speed, acceleration/deceleration and manoeuvring capability of vehicles. The impedance caused by a vehicle to the other vehicles in the traffic stream is considered as the measure to derive the equivalency value. The road space occupied and the average speed of a subject vehicle category, when compared with a standard vehicle (Passenger Car) decides the equivalency value of that vehicle category. In this study micro-simulation technique has been used to model the heterogeneous traffic flow observed on Indian roads. The vehicular interaction has been quantified in terms of Passenger Car Unit (PCU). It is found that the PCU value of a vehicle type is not a constant but varies over traffic volume and composition.