Buckingham_Canal_near_KL_University

Written by Rahul Miranda.

The benefit of leveraging inland waterways has long been recognized as a more efficient mode of transportation than either road or rail links, and has a significantly smaller carbon footprint. Although endowed with 7,500 km of coastline and approximately 14,500 km of navigable rivers, lakes, canals, creeks and backwaters, India has yet to develop this cheaper and greener mode of transportation and inland water transport (IWT) remains a largely untapped resource. In fact, while IWT accounts for 47 percent and 40 percent of the total transportation available within China and the EU respectively, in India that figure stands at a paltry 3.5 percent.

Inland water transport [could give a] … timely boost … to regional cooperation and integration within the sub-continent in the fields of trade and transportation.

A modal shift away from road transport to inland shipping could significantly boost India’s economy by lowering logistics costs, which are currently estimated to account for as much as 18 percent of the country’s GDP to 12 percent (8-10 percent in China and 10-12 percent in Europe). Furthermore, IWT could also result in safety benefits by replacing heavy goods vehicles which are responsible for an alarmingly disproportionate number of traffic accidents each year. The initiative would also open up business opportunities and generate employment in the area of dredging, barge construction, and terminal construction.

With such an array of benefits it is not difficult to see why the current NDA government has prioritized the development of this sector. By the passing of the National Waterways Act, 2016, 111 inland waterways across 24 States have been declared as National Waterways (NWs) for utilization as highroads of trade. While concerns have been raised regarding the implementation of this Act, the Government believes that the development of these waterways will prove to be a game-changer and will reduce the cost of transportation for goods and passengers, decongest the roads, as well as play a vital role in reducing pollution.  The Inland Waterways Authority of India (IWAI) has, inter-alia, been mandated with the responsibility of developing and maintaining the NWs for shipping and navigation purposes. Issues related to pollution due to the movement of vessels on inland waterways are duly addressed by the Inland Vessels Act, 1917.

The most telling contribution of the development of the IWT sector could yet, however, be the timely boost it is likely to give to regional cooperation and integration within the sub-continent in the fields of trade and transportation.

The same Modi-led government which is so keen on the development of the IWT industry was a major driver and party to the Bangladesh-Bhutan-India-Nepal (BBIN) Motor Vehicles Agreement that came into effect in 2015 and focuses on passenger, personal and cargo vehicles. This agreement, once fully operational, will allow vehicles from these countries to enter each other’s territory without having to trans-ship goods from one country’s truck to another’s at the border. The agreement will help improve the efficiency of transport and facilitate trade in the sub-region resulting in a potential increase in intra-regional trade within South Asia by almost 60 percent and with the rest of the world by over 30 percent.

The transnational nature of many of the rivers identified for development under the National Waterways Act offer immense opportunities for regional cooperation. South Asia – the least integrated region in the world – could directly benefit from the focus on regional connectivity through inland waterways with positive economic and environmental externalities beyond domestic borders.

Already, with the signing of the revised protocol on Inland Water Transit and Trade last June, both India and Bangladesh can now use each other’s territories for transiting goods to a third country. This enables Bangladesh to use Indian territories for transporting goods to Nepal and Bhutan. Similarly, India can access its landlocked states of Northeast India and Myanmar by crossing over Bangladesh. This will surely result in a sharp rise in trade between these countries. Currently, Bangladesh sources less than 10 percent of import from India, and sends less than 1 percent of exports — a situation that should rapidly improve in the near future as a result of the implementation of this protocol.

An interesting article published by The Pioneer in June 2016 discusses a further ‘out-of-the box’ approach for using increased IWT to boost regional cooperation. It suggests that instead of a mere division of waters, as has been the case in the Indus Waters Treaty and Ganges Treaty signed by India with Pakistan and Bangladesh respectively, the discourse could shift to adding more value to rivers and then sharing all its benefits.

Another unique feature of inland waterways is the ability to strengthen the negotiation power of the lower riparians by their ability of regulate access — such as those related to ship size, navigation time period, environmental regulations — for the upper riparian.

As India seeks to partner with its neighbours on river water cooperation, which includes a framework on inland water transport, it may find itself more equal to the lower riparians and lose some negotiating power as an upper riparian. But it need not take a non-engagement approach, as the resulting benefits — social, environmental, economic and political — that could be shared with the neighbours will outstrip all fears and perceived losses.

Rahul Miranda is practising lawyer in India currently pursuing his L.L.M in International Maritime Law at Swansea University. Photo Credit: CC by Internal Waterways in India/ Wikimedia Commons

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