Inland water transport: The new imperatives

In spite of its many advantages, why inland water transportation has not become the first choice of shippers for the movement of goods within the country, discusses MP Pinto.

Most maritime experts and commentators believe that the first systematic approach to the question of development of inland water transportation was taken with the formation of the Inland Waterway Authority of India (IWAI). There is no doubt that this was a significant and important step in the development of this mode of transport. But waterways in India had been extensively used in the past. During the Mughal period, not just trade and commerce, but even troop movement took place along waterways linking different parts of the Mughal Empire. It was an integral part of business and defence preparedness.

What is not so widely known is that as recently as the early part of the 19th Century the British explored the idea of using inland water transportation as part of their plan for outwitting Russia for control of Afghanistan in what was known as the Great Game. The idea was to see if navigation on the Indus River was feasible and whether it could open a route to Central Asia for British trade and commerce. It was vital for the British that the Russians should have no inkling of what they were really trying to find out since this would have led to immediate reprisals. So the British expeditionary boat, manned among others, by draughtsmen, cartographers and surveyors, was supposed to be carrying English horses and a special gilt carriage as gifts for Maharajah Ranjit Singh. But throughout the voyage experts mapped the course of the river and plumbed its depths to check its suitability for use in the movement of goods.

Today, such secrecy is no longer required. Cartographic surveys and full scale dredging to ensure the least available draft (LAD) can be openly done, but the sad fact is that inland waterways as a preferred means of transportation of goods has yet to take off to any significant extent in modern India. Why is this so and what policy initiatives are needed to set things right?

It would be presumptuous to assume that all that needs to be done can be covered in a short article of this nature. Nor is it necessary. The bare facts about inland water transportation are part of the record. Its fuel efficiency, its economic viability and its environmentally friendly nature have been written and spoken about extensively. It is not my intention to repeat all that has been often said about inland water transport but rather to question why, in spite of its many advantages, this mode of transportation has not become the first choice of shippers for the movement of goods within the country. We need to concentrate on this rather than merely listing its virtues and bemoaning the fact that is spite of all that can be said in its defence, it still is the step-child of trade and government alike and the least favoured among competing modes of transportation.

In most discussions on the cost advantage of inland water transportation, we speak only of its per tonne kilometre cost and stress that it is far and away the lowest of any mode of transport. Yet, everyone knows that water routes can never provide a door-to-door service. As long as we do not factor in the land leg journeys on both sides of the voyage and the cost of lift-ons and lift-offs at each land terminal/factory, we are guilty of understating the costs of this mode of transport. If the land legs on either side are very long and therefore very costly, or if they are not well served by an efficient method of transport, the lower costs of water transport are effectively nullified. To look at the bare costs of water transport alone, therefore, is to see only half the problem.

The first step to be taken is to work out suitable land linkages in a multimodal transport matrix that will act as props and links to water transport. This is where policy makers need to be more vigilant and aggressive and to understand where intervention is really needed.

So far, IWAI has concentrated on schemes for building well-planned and well-equipped terminals along waterways. But the equally important aspect of ensuring efficient road linkages to and from the ultimate user has been neglected. As long as this continues inland water transport will never really take off. These road linkages must be carefully and meticulously planned and the task cannot be successfully tackled without the full involvement of the maritime states concerned. It is they who must plan such linkages to ensure that there is a swift and reliable method of getting water borne cargo to its ultimate destination without any hassles. National waterways with a reliable draft and well-equipped terminals are very important but to be truly effective they must be backed up by efficient multimodal linkages.

Another area in which policy initiatives have been a little askew is in the field of incentives. So far the emphasis has been mainly on supply side incentives, ie, we give sops to owners of inland vessels in the form of concessions in terminal charges or light dues etc. Sometimes we go further and mandate the transport of a certain cargo exclusively by inland waterways. In the long run, these steps will have only a limited impact. Of what use is it to subsidise inland water vessels or to reduce the terminal dues or light dues they must pay if no-one is willing to use them to move cargo? Monetary concessions to owners of vessels cannot negate the basic weaknesses from which the service suffers. Similarly, pre-empting cargo for this sector can lead to a backlash. Instead, we should look to incentivise shippers through an imaginative scheme of tax breaks for those using this mode of transport. When such benefits are offered, the shipper himself looks to use this mode of transport more frequently and we achieve our objective without having to go through a clumsy process of reservation that not only breeds discontent but also leads to attempts to bypass the system wherever possible.

In addition to positive supply side incentives to inland waterways, we need to remove the preferential treatment given to other modes of transport. This is an unnecessary handicap under which an environmentally friendly mode of transport must labour and it should be speedily removed. Indeed there is a case for negative incentives to means of transport that cause pollution. In Germany, one of the ways in which short sea shipping is promoted is by the imposition of an allocative tax on road transport. When we consider the huge sums of money spent on construction of roads and the relatively paltry outlays on waterways it would be appropriate to demand such a tax as a measure of recouping a small portion of what is spent by society on the basic infrastructure on which road transport is completely dependent. It would also recognise and reward the contribution made by inland water transport to a cleaner environment in contrast to the huge carbon footprint imposed by road transport.

Finally we need to look beyond dredging (important though it is) as a means of ensuring adequate draft in inland waterways throughout the year. One important tool in achieving this is the establishment of River Basin Authorities for important rivers. There are multiple stakeholders in the management of rivers and all of them must play their part. Irrigation, navigation, hydro power, flood control, fisheries, tourism and a host of other users all have stakes in the efficient use of river water. A river basin authority, perhaps under the control of the Ministry of Water Resources, would bring about such an approach by storing flood water in the upper catchment and releasing it in the lean season to generate hydro power as well as to assist irrigation, tourism, fisheries etc. All sectors will benefit but navigation will be especially advantaged because this is an effective way of ensuring LAD. The details would have to be worked out but there is no getting away from the need to introduce a coordinated approach among users of river waters so that no sector is neglected and optimal use of river waters is ensured.

Inland water transport is an idea whose time has come. For too long it has been the step-child of planners and policy makers in the transport field. It is time for it to emerge and claim its place in the sun.