In order to carry out economic analysis to assess the operating conditions of existing or upgradation of road infrastructure, the fundamental speed, flow and density relationships are essentially required to estimate roadway capacity. In this direction, the simulation models would help in assessing these fundamental characteristics under different traffic conditions, but calibration and validation is essentially required using observed data. In view of this, the objectives have been conceived to develop microscopic traffic simulation model to estimate heterogeneous vehicle movements on different types of roads varying from single lane to eight lane divided. Further, development of speed, flow and density relationships also proposed. Accordingly, FLoMiTSiM, a microscopic traffic simulation which was developed for homogeneous traffic conditions on urban roads is considered in the present study to customize to analyze vehicular movements under heterogeneous traffic conditions on inter-city roads. The validation results from the comparison of simulation and observed data revealed that developed simulation model is able to predict the vehicle movements realistically. Using the simulation data, the speed-flow-density equations have been developed for different types of roads. The roadway capacity and jam density values have also been estimated which very close to Indo HCM study. The outcome of the study is going to be useful for the authorities who plan and execute the road construction works to take appropriate decision while improving travel operations on the inter-city roads.