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Coastal, inland water transport to get push

Experts say transportation via inland waterways would cut cost of logistics to a great extent

BS Reporter 

Shipping

Finance Minister on Thursday announced several steps to promote and inland water transport - a sector that has been neglected for years and has the potential to emerge as one of the cheapest and most environment-friendly modes of transport.

"Sixteen new port projects are proposed to be awarded this year with a focus on port connectivity," Jaitley said in the 2014-15. Development of can improve vastly the capacity for the transportation of goods and so a project on the river Ganga called 'Jal Marg Vikas' (National Waterways-I) will be developed between Allahabad and Haldia to cover a distance of 1,620 km. This would enable commercial navigation of at least 1,500 tonne vessels, Jaitley said.

"With the kind of steps being taken towards the and port segment, it is very clear that the government is looking at balancing multi-modal transportation," said Bharat Chhoda, senior analyst with

Currently, 65 per cent of the cargo is transported via road and the rest through rail and other modes.

"Transportation via inland waterways, which is a cheaper mode of transportation, can in fact bring down cost of logistics to a great extent," said Chhoda.

"This can indirectly help boost the GDP (gross domestic product), which is the ultimate aim of the government," said an analyst with a local brokerage.

Noting that development of ports is also critical for boosting trade, the government proposed to set up 16 new port projects to be awarded this year with a focus on connectivity. "No details have been given about where these ports are coming up. So, it is difficult to say how good or bad the move is. More clarity needs to come on this front," said a Mumbai-based maritime consultant. "However, if set up at right locations, it can reduce the turnaround time of ships and boost trade volumes in the long-term," he said.

The Rs 11,635 crore allocated for the development of Outer Harbour Project in Tuticorin for phase-I is also a positive move since it can be an alternative to the Chennai port, which is currently saturated, said industry officials.

"Though Ennore does take the burden of Chennai cargo at present, it also has its limitations. The move to expand Tuticorin is no doubt a good idea but where the funds are being used will have to be seen," said the maritime consultant.

Tuticorin can expand further only in the sea and so if the funds are going to be used entirely to increase the draught from current 13 meters, it makes sense, else the funds are not going to be enough, said maritime industry officials.

Most industry officials were of the view that the Budget should have also given some incentives to the sector.

"There should have been some announcement of an outlay for the Previously, it has been only about Rs 250 crore, which was not enough and so we were expecting some more funds this time for this segment," said another maritime consultant.

The Budget also mentioned policy layout for encouraging the growth of Indian-controlled tonnage to ensure increase in employment of the Indian seafarers.

SEZs will also be developed in Kandla and JNPT, said the Budget. A comprehensive policy will also be announced to promote Indian ship building industry in the current financial year. It is too early to say much on the ship building policy, said officials.

First Published: Fri, July 11 2014. 00:32 IST
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