Bilateral water transport deal favours Bangladesh
Source:The Hindubusinessline
The India-Bangladesh Protocol on Inland Transit and Trade was
renewed recently at the end of a two-day meeting in Dhaka. The renewal will be
valid for two years till March 31, 2014. India had wanted a three-year tenure,
but Bangladesh was not agreeable. The protocol was first signed in 1972, after
the emergence of Bangladesh as an independent country. There have been several
renewals since then, though the process has not always been smooth and easy.
Between 2003 and 2006, the renewal took place virtually on a
month-to-month basis. In May 2007, a two-year tenure was fixed, and extended by
another two years till March 31, 2011. Last year, the extension was granted only
for one year. The last protocol, therefore, expired on March 31, 2012. The
tenure of the protocol, India felt, should be co-terminus with the bilateral
trade treaty to attract private investments in the inland water transport (IWT)
sector.
If the trade treaty is valid for five years, the protocol should
also be valid for the same period. Clearly, that has not happened.
Many in India’s IWT circles doubt the relevance of the protocol,
which is supposed to benefit barge operators in both countries, but in reality
works only to the benefit of those in Bangladesh. This is because the trade by
river route with Bangladesh is dominated by barges carrying the Bangladeshi
flag.
FEW INDIAN BARGES
The participation of Indian barges is negligible. As a result,
even Indian exporters to Bangladesh use Bangladeshi barges. There are many
reasons for this state of affairs, the most important being the high cost of
operation of Indian vessels. Indian barge operators complain that, unlike their
Bangladeshi counterparts, they do not get any subsidy. Also, there are
allegations of undercutting by Bangladeshi vessels.
India’s connectivity by the river route to Assam is also through
Bangladesh. Which means Indian vessels transporting goods between
Pandu/Karimganj/Silghat (all located on the river Brahamaputra in Assam) and
Kolkata/Haldia will have to transit through the Bangladesh waters, and therefore
will be governed by the same protocol.
Unfortunately, transportation of goods by the river route between
Assam and Kolkata/Haldia, once a lucrative business, has now virtually stopped.
The public sector Central Inland Water Transport Corporation
(CIWTC) was once the major operator on the route. Not any more, with CIWTC now
being in a moribund state. Private operators too are reluctant to enter due to
the high cost of operation vis-à-vis rail and road transport.
RECENT TALKS
At the protocol meeting in Dhaka held in the first week of July,
India conceded Bangladesh’s demand for enhancement of fee for maintenance of the
river routes incorporated in the protocol. Earlier, the Indian Government used
to pay at the rate of Tk 5.25 crore annually. Henceforth, the fee will be Tk 10
crore annually.
The Bangladesh authorities concerned are supposed to spend the
amount on maintenance of the channel and other facilities. However, Bangladeshi
vessels dominating the trade will be the beneficiaries of India’s largesse.
Since movement of goods by river route to and from Assam too has virtually
stopped, there is no way Indian vessels could hope to benefit from the
improvement in the maintenance of the protocol route, if any.
Bangladesh is also very strict about allowing any Indian vessel
into any river port not included in the protocol. Unfortunately, India’s
attitude in this regard is lax. For example, the Pujali river jetty (on the
Hooghly river near Kolkata), not included in the protocol, is extensively used
by Bangladeshi barges for loading fly-ash released by a private power plant
located nearby. There are instances where Bangladeshi vessels strayed into
Tezpur (Assam), not included in the protocol. But India chose to look the other
way. As per the protocol, the Bangladeshi vessels are not supposed to
participate in intra-country trade, that is, in the transportation of goods
between, say, Kolkata/Haldia and Assam. However, there have been complaints of
violation of this provision of the protocol.
The Bangladeshi vessel owners justify it, saying the Indian
exporters, who secure the permission, should be held responsible. How such
permission could be granted in violation of the relevant provisions of the
protocol is a matter that needs probing. At the Dhaka meet, no decision could be
reached on several other issues, such as India’s demand for long-term validation
of the river transit and trade; permanent transshipment facility at Ashuganj in
Bangladesh to facilitate river-cum-road transportation of goods to India’s
north eastern States via Akhaura; and Bangladesh’s demands for extension of the
protocol to cover the coastal transportation of goods between the two countries,
and the payment of customs facilitation fee of $8 per tonne by India.
These issues, it was decided, would be examined by committees to
be constituted by representatives from both countries. Other issues which came
up for review included the pilferage problem on the Hooghly, landing rights for
crew at all bunkering and loading/unloading points (raised by Bangladesh) and
the need for proper maintenance of the protocol route — including night
navigation facility, introduction of the global positioning system, land Customs
station at Mongla and inclusion of more ports of call (raised by India).
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