Prof. P.K.Sarkar
does a study on the
economic feasibility
for development of
inland water
transport
infrastructure
facilities for National
Inland Water Transport (IWT) in India forms a very small part of the total transport network of the
country, despite being energy efficient, economic and environment-friendly. The primary reason
for low share of IWT traffic is its spatial limitation. Inland waterways are confined to specific
regions and are effective only when both origin and destination of production and consumption
centres are located at the waterfronts. The withdrawal of water for irrigation purpose also poses a
major problem for operation of IWT in India. Besides this, there are number of navigational hazards
affecting waterways, like shallow waters or inadequate depth, siltation, bank erosion etc. The
Government of India, in its policy document of Inland Water Transport had envisaged a sizeable
increase in the cargo traffic to 20 billion tonne-km within a five-year period from the level of around
1 billion tonne km in 1999-2000. However, the expected increase did not take place. IWT being an
economical and eco-friendly mode has great a potential in India, if necessary investment is made in
infrastructure like fairway, terminals, better vessels and navigational aids. A pilot study was
conducted on NW1 (Ganga-Bhagirathi-Hoogly river system) and NW2 (Brahamaputra river
system) to work out the viability of such investment not only from a financial point of view but by
assessing the potential economic gains too. Certain tangible gains were quantified along with the
intangibles like social and environmental benefits.
STUDY AREA PROFILE
To study the feasibility of IWT in India, the two major waterways chosen for study are;
- NW 1: Ganga - Bhagirathi - Hoogly river system, covering a distance of 1629 km and passing
through the three states of UP, Bihar, Jharkhand and West Bengal. NW
2: On the Brahmaputra river from Dhubri to Sadiya, covering a distance
of 891 km, passing through Assam and linking the north east region to
the main ports of Kolkata and Haldia. It is also a major link to
Bangladesh.
ASSESSMENT OF DEMAND FOR CARGO MOVEMENT
ON NATIONAL WATERWAYS 1& 2
A primary survey was conducted to assess the potential cargo movement
on NW1and NW2. Five commodities, namely, steel, coal, fertilizers,
cement and fly-ash were identified for the study and their movement
between origin-destination pairs was quantified. This current information
was used to make prediction for the years 2011 and 2021. The total
potential transportation demand for IWT for the year 2010-11 is 6 billion
tonne-km and 7.7 billion tonne-km in 2020-21. NW 1 and NW 2 presently
carry a total cargo of 0.78 million tonnes including POL, food grain, logs
and tea, which have not been included in the study. POL products will be
transported by pipeline. Thus, the current transportation demand (1999-
2000) of 0.17 billion- tonne-km will increase to 1 billion tonne-km by 2010-
11 and 1.3 billion tonne-km by the year 2020- 21.
TABLE 1 OPERATIONS UNDER REALISTIC FULLY DEVELOPED SCENARIO (  MN) |
| Scenarios |
Cumulative
Freight Demand
Carried Over 25
years
(million tonne) |
Cumulative over
25 years period
at 0% Discount Rate |
Balance
(Benefit -
Cost) |
Net Present
Value (NPV)
at 10 %
discount
Rate |
EIRR |
Benefit
Cost
Ratio
(B/C |
| Total
Cost |
Total
Benefits |
Combined NW 1
and NW 2 |
12.3 |
5060 |
26740 |
21680 |
2290 |
17% |
1.81 |
| NW 1 |
11.3 |
3290 |
18740 |
15450 |
1950 |
20% |
2.16 |
| NW 2 |
0.05 |
1820 |
3860 |
2050 |
-730 |
6% |
0.63 |
| Source: NCAER, New Delhi |
| Note: $ 1 = approx. Rs 50 |
ANALYSIS OF FEASIBILITY STUDY OF IWT PROJECT
OF NW 1 & NW 2
While working out the economic benefits, the following economic gains
were derived in this analysis in the form of:
- Savings in cost of operation of IWT vis-à-vis road transport.
- Savings in medical expenses due to reduced pollution levels in the
environment.
- Fewer accidents on roads due to congestion.
- Saving in loss of wages due to absence from work- was not considered
in terms of numeraire assuming that there is no production loss
considering surplus unemployment in non-urban or semi-urban areas.
- Savings in fuel expenses due to shift to IWT.
- Generation of Employment due to proper development to IWT
In order to work out the detailed feasibility study, a realistic fully developed
scenario with respect to mechanical loading and unloading facilities at all
the terminals coupled with night navigational system was considered
along with the cost break-up for two national waterways as presented in
the Tables (1& 2)
Untitled Document
TABLE 2- THE COST BREAK-UP ON NW 1AND NW 2 ( MILLION) |
| Sl. No. |
Component |
Cost NW1 |
Cost NW2 |
| 1 |
Fairway |
1600 |
500 |
| 2 |
Terminals |
660 |
1150 |
| 3 |
Vessel Cost (only the cost of dredgers is included) |
380 |
430 |
| 4 |
Navigational aids |
230 |
150 |
| 5 |
Total (1+2+3+4) |
2870 |
2230 |
| 6 |
Physical contingence |
250 |
190 |
| 7 |
Price Escalation |
50 |
40 |
| 8 |
Financial Cost +Price escalation |
3160 |
2460 |
| 9 |
Economic Cost |
2020 |
1670 |
| Source: NCAER, New Delhi |
| Note: $ 1 = approx. 50 |
CONCLUSIONS
There is a need to integrate the IWT within the inter-modal transport
system such that door-to-door service is provided for the movement of
domestic as well as international cargo. This will help to meet the market
demand of convenient and competitive service while optimizing the
economic, financial, environmental and social benefits that can be derived
from each mode in the entire transport chain.
There is need to accord priority to IWT through coordinated planning,
investment and implementation of policies as well as securing
cooperation of other agencies related to IWT and water resource
management. Besides, there is scope of development of tourism
along the waterway.
The EIRR worked out at 17 per cent is very viable for investment in
IWT and this study reinforces the conclusion that in its 12th Five Year
Plan India should make massive efforts for the development of IWT
and promote public awareness of benefits of a modal shift to IWT
wherever possible.
(The author is presently engaged in teaching, research and consulting
work in the area of transport planning, traffic engineering, road safety
audit and transport feasibility studies in the School of Planning and
Architecture. An expert in his domain, Dr Sarkar has been actively
involved as a consultant in various projects in areas of transport planning
and design, urban planning, environment planning, road safety audit and
highway design study. Presently, he is an active member of many
technical committees.)