Monday, 21 July, 2008

Inland Water Transport awaits a boom

With unlimited prospects and a ready answer to the rising road & rail transport costs shored up by the crude price spiral, players entering this ‘sunrise’ sector of inland water transportation (IWT) have been few and far between. Today, IWT carries only 0.17% of the total inland cargo throughput in the organized sector, despite the fact it being an eco-friendly, cost effective and fuel-efficient mode.

Sudhir S Rangnekar, Managing Director & Group CEO and Former Director of Shipping Corporation of India pointed out, “Although water transport when compared with rail or road transport requires relatively less infra-structural investment and developmental costs besides generating employment opportunities. However, dredging of the rivers and canals to ensure sufficient depth could give the needed fillip.”

India has 14,500 km of navigable waterways, which include rivers, canals, backwaters, creeks, etc. Almost 5,200 km of major rivers and 485 km of canals are suitable for mechanised crafts. At present, three waterways have been declared National Waterways. These are: The Ganga from Haldia to Allahabad (National Waterway No. 1), the Brahmaputra from Dhubri to Sadiya (National Waterway No. 2) and the West Coast Canal from Kottapuram to Kollam along with Udyogmandal and Champakara Canals (National Waterway No. 3).

Navigable rivers

According to Pradeep Kumar, Secretary of the Inland Waterways Authority of India (IWAI) the Ganges is a navigable river with sufficient draft especially from its confluence with the Yamuna at Allahabad onwards all the way to Haldia a total of 1620 km (NW -1). So is also the case with the Brahmaputra between Dhubri and Sadiya stretching over 891 km (NW – 2). This NW-2 has comparatively heavier traffic.

“The problem is with the private operators who have not got fully into it,” informed a government official. “Although the Patna-Haldia (1020 km) stretch of the river Ganga is fully navigable, yet the private sector is not coming forward to utilise it fully because of three reasons: -

1) The distance by water is more than the distance by rail - but the railways on the other hand are congested;
2) There is also the matter of costing – which one is better than the other? But low value cargo such as stone chips, timber, etc., can always go by water as they in any case don’t get a chance of preferential transport by railways;
3) There is the need of a well-designed vessel that can carry around 600 tons of material and which can operate in waters with 1.8 mt draft. If someone produces these types of vessels, he can run a booming business.”

Brahmaputra (NW-2) flows from Assam in India to Bangladesh before flowing into the Bay of Bengal. The river Ganga too flows into the Bay of Bengal. Inland vessels therefore can travel from Kolkata / Haldia to Assam through waterways in Bangladesh. India and Bangladesh have an agreement under which inland vessels of one country could pass through the other country’s waterways for transportation of cargo. Unfortunately, Bangladeshi vessels do 80% of the trade between India and Bangladesh.

Mr. Kumar contends that the government has come out with an action plan of encouraging the formation of joint ventures between IWAI and private parties. “Already three joint ventures have taken shape, two with SKS logistics and another with Vivada Waterways. The joint venture with SKS includes the construction of 16 barges for plying between Kolkata and Pandu, Kolkata and Bangladesh and other routes.

“The government has earmarked around Rs 900 crore over the period of the next three years for development purposes which includes construction of terminals, night navigational facilities, dredging, etc. Since 1996 around Rs 450 crore has been spent on dredging alone.”

Cargo abounds

Cargo has never been a problem on any of the National Waterways confirms Kumar. There is plenty of cargo available. Food Corporation of India alone maintains massive stock food grains in their warehouses in Patna and elsewhere and all this stock is moved to and fro between the rice mills and the consumers in West Bengal and other places. A variety of building materials including sand, stones, chips, cement and several other kinds of merchandise are moved in massive quantities catering to the needs of consumers along the entire Gangetic plain.

Pakur in Bengal is unique for its exquisite high quality stones, which is found to be excellent for construction purposes pointed out another player in the field. In the river Sone there is a sufficient amount of high quality sand, which also finds use in construction. All these are low value items, hence even if it takes 10 to 15 days to get transported, it would hardly make any difference and the low cost of water transport would bring down the cost enormously.

Positioning for a break-through

A coal handling facility at Jogighopa had been commissioned. A number of power projects too are on the anvil in the north. The waiting time for getting rakes to transport coal by rail is four months. Besides, the railway track is narrow gauge to the north of the Brahmaputra and broad gauge to the south. So the water route is very feasible. Thus Jogighopa terminal will expectedly be a big hit. Hence, it is an advantage to harness the inland water ways.

Policy on IWT:

“So far we have been focusing on developing terminals and jetties on the public private partnership (PPP) module,” says Kumar. “But it has not been successful. The perception that seems to have evolved is that infrastructure should be developed by the government and the operators should be left to invest in the vessels they will operate.”

The government is in the process of declaring another three National Waterways and several canals informed a government official. Apart from promoting IWT mode for inland cargo movement, the policy also emphasizes the possibility of cooperation with neighbouring countries through protocols and bilateral arrangements.

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