The connectivity between the North-Eastern Region of India and Bangladesh is the new buzz in the trade fraternity. The utilization of rivers as the link between the two by developing the inland waterways system has been widely accepted and appreciated by the industry. Here we explore the undiscovered potential of inland waterways and bring forward the revival of the Indo-Bangladesh friendship along with the latest developments taking place on the same.
India’s northeast is a prisoner of geography and has international borders of 5182 km that it shares with countries such as China, Bhutan, Myanmar and Bangladesh. Although the region is disconnected from the Indian mainland due to geographical reasons, the region’s economic prospects can be augmented by a number of measures across different areas, of which- trade logistics, e-commerce supply chains, transportation and border infrastructure deserve more attention.
Unveiling the masked potentials of the Northeast
The strategic location and potential of the region have bolstered trade with the neighbouring countries, especially Bangladesh, considering both are the land of rivers.
According to a report by the World Bank, the region has a strong long-term potential, with a little support from the central government and viability-gap funding.
The NER is a source of natural resources and produces -tea, crude oil, natural gas, silk, bamboo, varieties of fresh and quality fruits, even the most demanded organic products.
However, transportation of cargo to the seven sisters of the North-East region via the chicken neck of Siliguri create delays and difficulties for the trading fraternity in the region.
According to Amlan Basu, Director, AVS Group of Companies and an expert in waterways transportation, “Logistics connectivity is certainly one of the major constraints for those 45 million people. Although they have been struggling for years; due to Industrial units, they face more constraints and challenges like practical difficulties, poor infrastructure, lack of awareness, lack of entrepreneurial zeal, lack of marketing skills, the problem of unemployment and real estate or accessing finance etc.”
The current government is vigorously working on improving the transportation infrastructure of the region to sustainably develop and boost the economy of the region. And, inland water transport system is the best way to ensure provisional access, mobility and connectivity in both countries.
Mr Basu expresses how this offers a huge potential for developing regional connectivity through an economical and greener mode of transport. “Both countries have taken positive steps through bilateral agreements for use of cross-country waterways to promote trade and tourism,” he added.
He further adds that the co-operation agreement on the use of Bangladesh ports and Inland Waterways has not only strengthened the friendship between the two countries but has also created a win-win situation.
The development of Inland waterways acts as hope for succour for the NER, thus enabling the region to explore and utilize its full potential.
Indo-Bangladesh Protocol for Inland Transit and Trade (IBPITT) bolstering trade between both countries
The Inland Waterways Authority of India, in an Inland water transit and trade protocol between India and Bangladesh, agreed to transit inland vessels from one country to another through specific routes.
Mr Basu told us that the protocol which permits 50:50 cargo-sharing by Indo-Bangladesh vessels for transit and inter-country trade, earlier only carried low-value bulk commodity materials as last-mile connectivity, cargo origin location and volume size of the cargo were a great concern.
In his word, “There was Protocol on Inland Water Transit & Trade (PIWTT) river route but cargo origin location and last-mile connectivity was a concern for the trade along with the volume size of the cargo lots. The barges are used to mainly carry fly ash and other low-value bulk commodity materials.”
Under this protocol, the Indo-Bangladesh Protocol (IBP) route connects NW-1 with NW-2 and NW16 which are on Ganga-Bhagirathi-Hooghly river, Brahmaputra river and Barak river respectively. Moreover, it provides an alternate route for EXIM trade and transit of goods between two countries, thereby decongesting road routes.
The waterways, which grabbed the attention very late is one of the most economic, fuel-efficient, environment-friendly, employment-oriented and safest modes. And, has seen a boost in cargo traffic. The IBP routes constituted 46% of the total traffic on NW1 and completed approx. 3600 voyage in FY2018-19.
“We are deeply involved with Ministries and IWAI to include quite a few river jetties and areas under the PIWTT like Pangaon (BD) and Pakur, Kolaghat (IN) etc. where the demand of cargo for Bangladesh is growing,” informed Mr Basu.
Future Buildout of Indo-Bangladesh connectivity
The constant efforts in place to increase connectivity via waterways by developing National Waterways and IBP routes are known to increase trade between the two countries and reduce the cost of transportation.
As per IWAI predictions, the cargo traffic through the Indo-Bangladesh Protocol (IBP) route is projected to experience a growth of 27% from FY2018-19 to FY2019-20 with voyage expected to exceed by 4000 in fiscal 2019-20.
While fly ash will still remain the prominent commodity, steel, rice, stone and others will also be transmitted through the IBP routes.
According to IWAI, the Narayanganj and Khulna ports in Bangladesh are receiving more than 97% of IBP traffic.
The recently gained access to Chittagong port in Bangladesh will also help the country cut the transportation cost and expand trade and commerce.
Further, the government is also working on Fairway development to allow round the year uninterrupted navigation and revive trade routes at a cost of 305.84 crore on a share ratio of 80:20 between India and Bangladesh, for which the initial dredging for two years is likely to be completed by March 2021.
Also, Protocol route no. 5 & 6 i.e. Rajshahi Godagari – Dhulian are likely to be extended up to Aricha (Bangladesh) and the Daudkhandi Sonamura stretch on Gomti river are likely to be included as new route no. 9 & 10.
Commenting on the new initiatives, Mr Basu says, “We are enthusiastic about so many new initiatives our Govt. is planning. It should definitely lead the country to have a state-of-the-art logistics connectivity especially such under-privileged states will certainly have an economic growth by adopting this oldest mode of the transportation system through new strategies of the Govt.”
Apart from trade and commerce, the development of NW’s and IBP routes has also increased tourism in the regions and increased passenger traffic.
The Northeastern region, with the support from the government, is blossoming and moving towards becoming a trade hub. The recent development of National waterways has increased the trade in the region and helped extract full benefit from the region’s strategic location. Further, it has helped make trade easy, revived long lost friendship with Bangladesh and vastly cut down on expenses that have proved to be of tremendous worth to both the countries. Inland Waterways has surely acted as an anchor to strengthen ties between India and Bangladesh.