Eternal rivers like Ganga, Yamuna, Narmada, Godavari, Krishna or Cauvery Crisscross India with bubbling energy and watercolor reminding the joyous ways of billion ways of living. Our old epics have eulogized their presence by adequate coverage in ample measure by describing the emotions of our hero persons while living near these mighty rivers. While trying to merge with the globalization of our excellence, it is time to look at their forgotten potential as economic means to reach our set goals.

I am proud to cover an excellent consultant’s study from Inland Waterways Authority of India, Ministry of Shipping,  headed by an intellectual, respected Nitin Gadkari, our honorable minister.

The relevant web site with the study by RITES, one of the top consultants of Indian corporates.

 https://iwai.nic.in/showfile.php?lid=695

INTEGRATED NATIONAL WATERWAYS TRANSPORTATION GRID (NWT)

(CONSULTATION DOCUMENT) – RITES, an internationally reputed Indian consultant.

Let us learn the wisest counsel’s sane information and advice.

Indian economy

Let me preamble it with its terms of reference for deeper understanding:

“All the national waterways were studied independently by different technical/expert groups during different periods of time, adopting different approaches, to assess their technical and financial viability before declaring different stretches as National waterways.

 With a view to overcome time variations of the studies as well as to update the traffic estimates IWAI  entrusted RITES Ltd., a study with the limited scope “for developing Integrated National Transportation Grid and identifying Specific Projects for Private Investment for the development of Inland Water Transport System in the Country, with the following terms of reference.

Terms of Reference (TOR)

  • Formulate projects for each National Waterways system by identifying the projects for the best investment.
  • Identify projects to be considered under PPP operations/concession agreements.
  • Identify potential IWT terminals on NW-1, NW-2, NW-3, NW-4, NW-5, and NW-6.
  • Develop Rail & Road connectivity to the identified/proposed terminals.
  • Develop Sea Port and National Waterway connectivity including both physical and improvement of the existing charges for commercially viable connectivity.
  • Establish a Multi/Inter-model grid for smooth movement of goods traffic on each National Waterways.
  • Workout costs for Developing Integrated Transportation Grid around National Waterways.”

I am sure you have understood the above. But if not, let me concise it as identifying inland waterways for multi-modal transportation, identifying cost for usage, and also identify projects for public-private partnership.

At various periods and over decades, various expert agencies pertained to different base years for traffic estimation, projection period and inter-modal costs were engaged and also gave their reports. But to consider them at all at some base year work was undertaken by the consultant.

It is important to know this basic fact before we proceed further:

  • “Consultants have taken appropriate steps to up-date traffic flows to the base year of the current study (2011-12) and reconfirm/re-estimate traffic projections.
  • For up-gradation of commodity wise traffic estimates covering primary hinterland of each waterway, actual rail flow data for 2011-12 have used, whereas, for the road sector, road flow estimates for 2007-08 given in Total Transport System Study (TTSS) conducted by RITES on behalf of Planning Commission have been brought to 2011-12 levels by applying appropriate raising factors.”
  • For developing proposed facilities, a period of 4 years span has been proposed with the option of utilizing the first year for getting the necessary sanctions/approvals, and the rest three years for construction of terminal infrastructure.

We are yet to know the National Waterways Systems, identified in our nation.

They are:

1. River Ganga from Haldia to Allahabad 1620 KMs in length

2. River Brahmaputra from Dhubri to Sadiya 891 KMs in length

3. West Coast Canal from Kottapuram to Kollam with Udyogmandal & Champakara Canals 205 KMs in length

4. Kakinada – Puducherry stretch of canals with River Godavari and River Krishna 1078 KMs in length

5. East Coast Canal with River Brahmani and River Mahanandi’s delta 588 KMs in length

6. Barak river between Lakhipur and Bhanga 121 KMs in length.

What business potential these waterways portray as on date?

I would note the information like:

  • Major Ports such as; Haldia and Kolkata and important cities like; Kolkata, Patna, Varanasi, and Allahabad fall under its primary hinterland. The river system No. 1 serves richly endowed natural reserve areas as well as a large number of industrial units comprising Thermal Power Plants, Iron & Steel Plant, Sugar Milles, Cement Industry, Small Scale Industries, etc.
  • River system No. 2 serves the states of Assam, Meghalaya and Arunachal Pradesh covering about 37 traffic regions. Because of its connectivity with National Waterway 1 through protocol route via Bangladesh its catchment area is extended up-to-the state of West Bengal, thereby establishing its connectivity with Haldia and Kolkata ports.
  • National Waterway-3 (NW-3) comprises West Coast Canal from Kottapuram to Kollam with Udyogmandal and Champakara Canals and extends over a distance of 205 km, in the state of Kerala. The waterway is directly linked to Cochin Port; therefore, it can offer a cost-effective solution in handling foreign trade through the said port.
  • National Waterway 4 (NW-4) comprises Kakinada-Puducherry Canal System integrated with Rivers Godavari and Krishna. NW-4 can offer cost-effective IWT services over a distance of about 1078 km covering states of Andhra Pradesh, Tamil Nadu and Union Territory of Puducherry. All the civil districts (19) falling along the considered river systems are covered under the primary hinterland. NW4 offers connectivity to intermediate-ports like; Kakinada, Machilipatnam, Krishnapatnam and major port as Chennai and Ennore as well as it serves important cities like; Chennai, Visakhapatnam, Vijayawada, etc.
  • National Waterway 5 (NW-5) in the state of Odisha, extends from Talcher to Paradip Port and Dhamra Port, areas richly endowed with natural reserves on the one end and country’s major port on the other. It includes East Coast Canal with River Brahmani and River Mahanadi’s delta (623 km). By developing Hijili tidal waterway systems, IWT services on NW5 can offer connectivity up to Haldia that can result in the extension of services up to Allahabad (Uttar Pradesh) on NW1, up to Sadiya (Assam) on NW2 and up to Lakhipur (Assam) on NW6. The corridor is likely to contribute movement of coal & other ores to thermal plants, fertilizer plants, etc.
  • A stretch of river Barak between Lakhipur and Bhanga (121 km) is under consideration for declaration as Sixth National Waterway (NW-6). Like NW-2, NW-6 is also connected to Kolkata and Haldia and other IWT terminals in NW 1 via protocol route and further to NW 5.

The important point to note regarding national waterways grid is that although, all the declared waterway systems cannot be joined to form a national waterway grid, four out of the six national waterways can form a grid in the Eastern Region of the country i.e. NW-1 can be connected to NW-2 and NW-6 using protocol route through Bangladesh.

The study further goes on to give the reason why IWT is preferable?

It has quoted “Comparative intermodal costs are one of the visible decision-making tools for the users. Intermodal comparative costs are given in “Report of the Inter-Ministerial Committee to Identify New Areas of Private Investment in the Inland Waterways Transport (IWT) Sector” Planning Commission, (Transport Division), 30th November 2012, an overall advantage of IWT vis-à-vis other modes have been worked out. In the current exercise, to encourage and promote dependence on the IWT services tax exemption has been considered. Comparative intermodal costs Rs/TKm considered are given as under:

Mode VOC/Freight (Rs/TKm) Taxes Total Rs/TKm
Railways 1.36 3.71% 1.41
Highways 2.50  3.09% 2.58
IWT 1.06 Nil 1.06

I am not inclined to give too much information from the report since the above data confirms my feeling and internal anguish that IWT is the cheapest means of transportation and our state governments have yet to understand the utility of inter river transport in a multi-modal system to harness country’s available potential in transportation.

However, I would love to quote the consultant’s conclusions/recommendations for our consideration.

Recommendations

Based on the foregoing analysis, the following have been concluded:

  • High-density potential IWT Terminals that can attract 80 percent or above volumes of traffic on National Waterways have been identified for immediate consideration. On National Waterway-1, eleven locations have been suggested, as against five IWT terminals on NW2, four on NW3, three on NW4, only two each on NW5 and NW6.
  • Deep Sea Transshipment of imported coal, by providing Tran-shippers has been concluded.
  • To facilitate handling of bulk cargo like Coal, Iron ore, etc., a belt conveyor system has been proposed.
  • Infrastructure development to meet traffic projections up to 2031-32, is suggested subjected to the detailed study of each proposed terminal, independently.
  • Rail, Road & Port connectivity up to identified IWT Terminals to develop Integrated National Waterways Transportation Grid have been suggested. For each proposed/identified IWT Terminal independent study to firm up rail and road needs to be conducted.
  • Infrastructure development costs (on the normative basis), comprising; Fairway development, Terminal Construction/Up-gradation, Rail, Road & Port connectivity established.”

Now, let us have the expert’s recommendations as well for a clear understanding of the subject. How to proceed?

  • Because of the limited scope of the current study, DPR to firm up costs and benefits for the identified corridors and selected IWT terminals to have to be carried out ü By opting suitable measures to attract traffic amenable proposed IWT services, major/important Agencies/Shippers should be encouraged to Shift cargo to IWT.
  • To organize the regular movement of bulk users, assist in the development of required Terminal facilities to handle captive cargo
  • Deep Sea Transshipment to be encouraged with direct lighterage operation by IWT Barges.
  • To promote IWT services and to attract shippers & investors, incentives should be offered.
  • Financing options; Fairway development by Public & Multi-lateral, IWT Terminals by a mix of Public & Private Vessels-Ownership, O&M by Private.”

Or in a nutshell, I  can say that please utilize seriously IWT as the means of transport without any more delay.

Conclusion

Though I have been privileged to explain the expert study of RITES, one of the top consultants in the world on IWT, let me probe what has been done by the ministry concerned?

I can proudly say that “THE INLAND VESSELS BILL, 2020” is ready and reproduced for your knowledge.

https://iwai.nic.in/showfile.php?lid=1962

In a chorus, I am happy to note that it has been implemented on 28th April 2020.

Some basic features of the bill are:

  • It has 71 pages, 17 chapters, 112 sections, and 3 Schedules. Its preamble is

“An Act;

to promote economical and safe transportation and trade through inland waters, to bring uniformity in the application of the law relating to inland waterways and navigation within the country, to provide for the safety of navigation, protection of life and cargo, and prevention of pollution that may be caused by the use or navigation of inland vessels, to ensure transparency and accountability of administration of inland water transportation, to strengthen procedures governing the inland vessels, their construction, survey, registration, manning, navigation and such other matters connected therewith or incidental thereto. BE it enacted by Parliament in the Seventy-Fifth Year of the Republic of India as follows:”

The purpose of this article, my 100th in taxguru.in is to talk about something about which we hardly realize its value, i.e., water transport and its utility to remove pollution, roadblocks and easy facilitation of movement not only for goods but also for me to move from New Delhi to Chennai all routes by rivers only.

These views are purely personal and neither taxguru.in nor any other government agency is responsible.

I am thankful to the management of taxguru.in for having allowed me to publish 100 articles so far. I have also been motivated by my family members, particularly, my grandson, Mr. Rohan Karunakar who has started penning his thoughts.

Author Bio

Qualification: Post Graduate
Company: subramanian natarajan cpa firm
Location: NEW DELHI, New Delhi, IN
Member Since: 09 May 2017 | Total Posts: 131
A banker with 27 years of experience, a CPA from USA with specialization in US taxation, individual, partnership, S corporation or LLC taxation etc View Full Profile

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