Amitabh Verma, Chairman, Indian Waterways Authority of India (IWAI), tells Rouhan Sharma India has no option but to develop its waterways infrastructure to keep pace with the needs of a growing population and a developing economy. Here are some excerpts.
What is the importance and need for development of waterways?
There are various reasons. The first is the growing population that will keep growing till 2040-45. When we stabilize, we shall pass China sometime in between. The bulge of the population from 20 to 45 years of age will mostly be on the roads in the next four-five years. Already, when we have no cargo movement between 7 in the morning and 11 in the night, we are not able to move our passenger vehicles. I don´t think there is further scope for constructing 100 more flyovers in Delhi, Noida, or the NCR region. There is a limitation of expansion capacity that we have reached. It is a similar position with Railways. The gap between demand and supply on passenger movement alone is going to increase, whatever be the expansion.
Second: the expansion capacity is getting limited and costs are increasing. You have to acquire land for both railways and roads. A km of road requires about 16 m of width. If it is a four-lane road and 1 km length, you need about 15 acres of land. As per the Land Acquisition Act, you have to pay almost four times the circle value. All state governments are increasing their land rates every two-three years to gain revenue. This cost is going up, multiplied four times. You are looking at about Rs.10 crore only for acquiring land for just a single km, plus rehabilitation issues, plus the social impact, environmental impact, time taken in the acquisition, plus road construction cost. You are spending not less than Rs.17crore-Rs.18 crore for a km of road. This is for an average plain area. If it is a mountainous area, then that´s higher. In comparison, infrastructure cost in waterways is so much lesser. There is no environment or ecology issue, there is no land acquisition; actually, there is very little land acquisition, hence the cost here is much lower at Rs.2-3 crore at best.
What is the per km cost of transportation of cargo?
Transportation cost is cheaper and is operational cost. I am talking about capex. The capital expenditure is so substantially different plus the other inconveniences. Also, the scope of highway expansion is very difficult. These expansion plans are going to have to stop at some time and somebody has to understand this. The other aspect is the growing economy. We shall keep growing by a certain percentage which obviously creates more demand for transportation of coal if we need more power; as we are not self-sufficient in power. We need more steel, fertilisers, cement. All these have to be transported if the economy grows. With a growing economy and a growing population, there is absolutely no option but to spend more on waterways.
How do you see the growth of waterways infrastructure in the coming years?
India started focusing on IWT only as late as 1986 when IWAI was created. Therefore, the country lost 39 good years. It is not as if water transport was something new. The East India Company used it as did the Mughal rulers. However, post-independence, the feeling was that once we have a faster mode of transport - a modern network of roadways and railways - it can put us in league with the developed countries. Probably, in the zeal to provide connectivity through road and rail - constructing road-bridges and rail-bridges - at that time, they did not leave sufficient navigation clearances over the waterways. As a result, there are no vertical clearances or even horizontal clearances (between the pillars). Now, how do I move my barges? This is a very big issue today and is proving a bottleneck.
Second, power lines and telecommunication lines have also been put across the water, creating more problems. With the focus on the green revolution to hold water, water was drawn out of rivers to canal systems for irrigation, and that is perfectly all right, but it wasn´t done in a planned manner. Next, India required hydroelectricity and constructed dams with no navigation blocks, thereby killing the potential of navigation by creating all that infrastructure. A proper balance was never struck. Next, there is the issue of sewage discharge. The quality of water is an issue like in the Ganges, you can´t even stand there for five minutes.
All these issues lead to cost overruns as I have to modify existing structures, leading to coordination issues with state governments and various departments. It leads to social dislocation and to political issues. Modification of structures is a costly thing. It´s a tough job to be done now.
So, what´s the status today in 2016?
I just gave you the background. Since Independence, we have declared only five national waterways of which we have started developing three. The fourth and fifth ones have not been touched yet and we are just in the process of starting them. The third waterway is in Kerala which is almost developed. The first one is the Ganges which is partially developed and the second is the Brahmaputra, also partially developed. Some movement is happening. Three million tonne (mt) is moving on the Ganges and two mt on the Brahmaputra. We are going to start work on the fourth and fifth waterways (Andhra Pradesh, Tamil Nadu and Odisha). This is one aspect.
The second aspect to this is the fact that in 25 years from 1986 to 2010, we have just spent a miniscule Rs.1,117 crore on waterways. Even today, if you perform a comparison, the Railways spends $17 billion in a year while on highways, expenditure is $12 billion. What are you spending on waterways? $30 million a year? How can you say we need to immediately capture the traffic currently plying on roads and railways? We are already handicapped. In a 100m-dash, they are about 30-40m ahead and you are still putting more into them.
Still, what are some upcoming projects you can tell us about?
It is not that nothing is happening but there is an additional responsibility upon IWAI to also ensure business tie-ups. The problem is that unlike with trucks, for instance, investments here are bigger. You can buy a truck for Rs.25 lakh but the investment for a 2,000 tn barge is at least Rs.10 crore. Moreover, if you put that on the first national waterway, you can´t just take it out and then put it elsewhere. Therefore, unless there is a long-term commitment, it is not feasible. Someone has to give me at least six-seven years´ worth of cargo to move around. Unlike the NHAI, I have an additional responsibility of ensuring that I also get business after I create the infrastructure.
Why don´t you invite public private partnership (PPP) in waterways? You can have PPP based systems, charge toll...
Globally, there isn´t a single waterway that can pay for itself. Even the busiest of waterways in the world have not paid for themselves because it is not cost-effective. There are other modes. For instance, the river Rhone is maintained by the French firm CNR. They have a lease of 40-50 years but their income from water usage by navigation is almost negligible and is, in fact, negative. However, they have many hydel power plants on the waterway. They maintain the waterway for navigation but they derive their income from the power plants.
The maintenance costs still can be covered in some rivers but not on the Ganges or the Brahmaputra. These are two special rivers which are alluvial in nature. Heavy loads come every year. They are very dynamic rivers and move almost 10 meters vertically between the low and the high flood season. They move almost 15 to 215 m or 500 m also, horizontally. You have to dredge which will be about 60 per cent of your cost of capital. Annual dredging costs are too high. We are now giving out assured depth contracts. We floated a tender recently, just about a week back for assured depth. In this type of contract, we give out a stretch wherein we specify the width and the depth to be maintained.