The Parliament on Wednesday, quietly passed a bill. For many, it’s a step forward in re-writing Indian maritime history, for some its pure ambition, but the Indian Waterways Bill as it is called, aims to re-define the transportation infrastructure in India. The Bill adds 106 inland waterways to the list of national waterways, taking the total number to 111, but there is much more that’s testing ‘Indian waters’.
Indian Waterways: The Tipping Point
India has about 14,500 km of navigable waterways comprising of rivers, canals, backwaters, creeks, etc.
According to the official estimates, about 34 percent of Indian cargo is currently trans-shipped through international hub ports, resulting in revenue loss for Indian ports as well as high costs on the customer side.
Most EU nations and countries like China have maintained and upgraded their river systems on important routes to support large vessels. Bangladesh has increased its freight movement through waterways to 35 percent. India however, struggles to create depth in its river systems and evolve effective de-silting processes to accommodate even medium or small-sized vessels.
Sitting On a Goldmine?
Railways and roads have long enjoyed the attention of policymakers in India, but waterways were left behind. Transportation of cargo through inland waterways not only helps to rein in carbon emissions but also curbs the rate of road accidents, making it an effective means of transportation.
Experts believe that the maritime domain is much bigger than naval presence and security and ship-building and port development should be incorporated into India’s maritime strategy. Speaking in favour of a robust maritime policy, at the Raisina Dialogue convention in New Delhi, former foreign secretary Shyam Saran said,
India needs to develop dual facilities that serve both civilian and military purposes as China has been doing, in order to strengthen its maritime capabilities.Shyam Saran, Former Foreign Secretary
In terms of quantity, inland waterways can move five times more cargo than roadways and railways. The construction and maintenance of the waterways system is also cheaper to build and maintain.
Government is Gearing Up
Finance minister Arun Jaitely in his Budget speech this year, announced the government’s plan to develop new greenfield ports on both the country’s coasts.
Jaitley said that the work on the National Waterways Project, which proposes ‘to have waterways covering the entire nation, just like national highways, has been expedited.
Earlier in February, addressing a business congregation at New Delhi, Nitin Gadkari, Union Minister for Road Transport, Highways and Shipping, hinted upon the move.
We will set up 2,000 water ports, and Roll-on-Roll-off (RoRo) services at five select places in India to transport goods and vehicles, across India. The country has huge potential for water transport. Under this project, Varanasi, Haldia and Sahibganj will be developed as multi-modal hubs with roadways, waterways and railways.Nitin Gadkari, Union Minister for Transport
The government plans to construct inland waterways on Ganga, between Varanasi and Haldia, supported with 30 water ports. Under the ambitious ‘Sagarmala Project’, government aims to develop port infrastructure along the country’s 7,500-km coastline. The shipping sector is already hoping to see an investment of more than Rs 70,000 crore, in the coming months.
India’s 12 major ports currently handle close to 600 million tonnes of cargo traffic. The government has set a target of doubling this in the next five years.
Change in Cabotage Law: A Game-changer?
In February this year automobile manufacturer Hyundai loaded as many as 800 of its cars at the Chennai Port to be unloaded at the Pipavav Port in Gujarat. This was the first time Hyundai transported its cargo through the sea for the domestic market.
Explaining the significant move Chennai Port’s Deputy Chairman Cyril C George told Business Standard:
We see a lot of potential in this kind of movement of cargo. It is cheaper than the road route, and we are expecting the ministry of shipping to announce an incentive scheme for such traffic soon, and that would give further impetus to transshipment.Cyril C George, Deputy Chairman, Chennai Port
Hyundai’s decision came soon after the government announced a five-year relaxation in the cabotage law. The law makes it mandatory to use Indian ships for transporting cargo between different ports along the country’s coast.
Due to the lack of Indian RoRo vessels, 60 percent of India’s export and import containers are transhipped through ports like Singapore and Colombo, which involves huge expenditure and extra transit time.
The tweak in the Indian cabotage law might be a true game-changer. Chennai Port Trust is already talking to companies like Nissan and Ford for transporting cargo.
Adani Ports and Special Economic Zone, India’s biggest private port operator is now looking to expand its presence in Maharashtra and West Bengal after Gujarat. Adani’s larger port strategy is to club the port opportunities in Sri Lanka, Bangladesh and a few european nations to complete its “string of pearls”.
Strategic and Monetary Gain
Experts believe that this has both strategic importance and will lead to monetary gain. This may end Colombo’s monopoly in transhipment in South Asia and attract international carriers to operate in Indian waters. Colombo’s China-backed ports have long unnerved India’s strategic community.
While the challenge for the government remains to establish robust waterways systems bypassing problems like, seasonal river flows, dry summers, low height bridges obstructing traffic and diverting river navigation without hurting irrigation and drinking water needs, the benefits are surely worth taking that plunge.
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