Govt plans to develop inland waterways system

NEW DELHI: Inland waterways, once considered a poor cousin of road and rail transport, are now being given a new thrust. These are being developed by the government as an alternative means for movement of goods instead of the conventional road and rail option.

Road transport costs have been rising steadily on higher fuel prices and the government is now planning to develop a robust inland waterways system.

With numerous rivers ready to service the long coastline, the government has invited private sector investment through local logistics firms to develop requisite infrastructure for transport of raw materials and industrial goods.

Companies such as Reliance and ONGC are already using this cheap and eco-friendly mode for transporting crude and gas from ports to inland locations. The government plans an investment of Rs 800 crore on public-private-partnership (PPP) to develop three national waterways on Ganga and Brahmaputra rivers, and on the west coast.

The first waterway is planned on the Ganga-Bhagirathi-Hooghly rivers from Allahabad to Haldia over a distance of 1,620 km. The second national waterway is planned on the Brahmaputra from Dubri to Sadiya over a stretch of 891 km.

The third national waterway is planned to connect Kottapuram-Kollam sector on the west coast with the Champkara and Udyogmandal canals over a 205-km distance. The three waterways are expected to be fully functional by March 2010. These will be used for export of fly ash to Bangladesh and transport of coal, gypsum, clinker and cement within the country.

To kick off the development, state owned Inland Waterways Authority of India (IWAI) has formed JVs with SKS Logistics and Vivada Inland Waterways. It has signed two JVs with SKS Logistics. One for construction of six inland barrages of 2,000 DWT (dead weight tonne) each between Kolkata and Pandu (Assam) and the other for construction of eight inland barrages of 2000 DWT between Kolkata and Mongla (Bangladesh).

IWAI will be holding a minority stake of 30% and the balance 70% being held by the JV partner. Under the second JV, an investment of Rs 44 crore is being made and the shareholding pattern is the same as in the first. The third JV is with Vivada Inland Waterways for construction of two inland barrages of 1,500 DWT each between Kolkata and Dubri (Assam).

IWAI has also signed an MoU with ICM for setting up and operation of three floating jetties in West Bengal. Besides, IWAI is developing a project with NTPC on PPP basis for transportation of one million tonne of imported coal per annum from Haldia port to Farakka for use by Farakka power plant.

Despite the advantages and immense potential, inland water transport system is yet to take off with about 14,500 km of waterways remaining untapped. Even though cargo movement by inland water transport went up in 2007, it still accounts for barely 1% of total inland cargo movement.