One of the key areas of focus during Prime Minister Sheikh Hasina’s talks with his Indian counterpart Narendra Modi next month will be sub-South Asian economic integration. Two events in quick succession on September 10 and 12 conjured up that big picture of sub-regional connectivity and cooperation in trade and transit when Modi inaugurated South Asia’s first trans-border petroleum products pipeline between India and Nepal and opened India’s second of the
four World Bank-funded multimodal terminals in Sahibganj in Jharkhand state.
The 69-km pipeline, which runs from Motihari in India’s Bihar state to Amlekhgunj in Nepal, has a capacity of carrying petroleum products of two million tonnes annually, will replace costly and time-consuming ferrying of oil and gas by tankers from India as part of an arrangement put in place in 1973. India, Nepal’s sole supplier of oil, funded the Rs 324-crore project. The pipeline will provide cleaner petroleum products at affordable prices to the people of Nepal. In fact, jointly inaugurating the pipleline with Modi, Nepal Premier K P Sharma Oli announced a cut of Rs 2 per litre in the price of petroleum products in his country. At present, India supplies 1.33 million tonnes of petroleum products to Nepal every year and this is likely to double by next year.
More importantly, it will provide Nepal an assured route of fuel supply insulated from possibilities of disruption, adulteration and pilferage. The component of disruption assumes significance when one recalls that the supply of essential goods, including fuel, by road was hit by a prolonged agitation by Nepalis of Terai region bordering India protesting the new Constitution in the Himalayan country in 2015. The Madhesis of Terai are of Indian origin and the agitation and the economic blockade had put India-Nepal ties under great strain at that time.
Secondly, the pipeline was completed 15 months ahead of schedule—Modi and Oli had done the ground-breaking ceremony of the project in April, 2017, and could go a long way in countering the long-held perception in South Asia that about the slow pace of cross-border as well as other India-funded projects in countries of the region. The pipeline was first proposed in 1996 but remained stuck till Modi’s visit to Nepal in 2014 resulted in a deal to implement the project. But the Madhesis agitation had caused a disruption of three years to the project before it was cleared in March 2017. The pipeline going into operation much before time holds out hope for expeditious completion of India’s other bilateral projects in South Asia.
On September 12, Modi launched India’s second riverine multi modal terminal at Sahibganj built at a cost of Rs 290 crores in a record time of about two years since the Prime Minister had himself laid its foundation stone in April, 2017. This was the second of the three multi modal terminals being constructed on the river Ganga under India’s waterways development project. In November last year, the first multi modal terminal was inaugurated by Modi in his parliamentary constituency Varanasi. The two multimodal terminals will help open up industries of Jharkhand, Uttar Pradesh and Bihar to the global market and provide India-Nepal and India-Bangladesh cargo connectivity through waterways route. Among the goods expected to transported through these terminals are coal, stone chips, fertilizers, cement and sugar.
The convergence of road-rail-river transport at Sahibganj through the new multi-modal terminal will connect this part of India’s hinterland to Kolkata, Haldia and further to the Bay of Bengal and will get connected to north-eastern Indian states through Bangladesh by river-sea route. The capacity of the terminal is 30 lakh tonnes per annum and is expected to grow to 54.8 lakh tonnes per annum after an investment of Rs 376 crores for capacity enhancement in phase II under the public-private partnership mode.
The two multimodal terminals will help open
up industries of Jharkhand, Uttar Pradesh
and Bihar to the global market and provide
India-Nepal and India-Bangladesh cargo
connectivity through waterways route
The multimodal terminals being built on the stretch of river Ganga between Varanasi to Haldia in West Bengal for movement of large vessels up to 1500-2000 tonnes weight by maintaining a drought of 2-3 metres and setting up other systems required for safe navigation. The objective is to promote inland waterways as a cheaper and more-environment friendly means of transport, especially for cargo movement, diversifying from road transport and consequent pollution from fossil fuel like oil and gas. The multimodal projects entail construction of three multi-modal terminals not only in Varanasi and Sahibganj but also at Haldia, two inter-modal terminals, five roll-on-roll-off (Ro-Ro) terminal pairs, new navigation lock at Farakka in West Bengal, assured depth dredging, integrated vessel repair and maintenance facility, differential global positioning system, river information system and river training. India has already built a big multimodal terminal in Myanmar’s Rakhine province that will open up connectivity in trade and transit between India, Myanmar and South East Asia. The combination of road, rail, waterways and air connectivity will certainly help overcome the huge road traffic congestion at Integrated Check Posts among the South Asian neighbours.
The petroleum products pipeline between India and Nepal and the multimodal terminals connecting India with Bangladesh, Nepal and Myanmar is being seen as part of India’s efforts to retain its influence in South Asian neighbourhood where China has made inroads in recent years by funding infrastructure and connectivity projects under the Belt and Road Initiative (BRI). Given the Modi government’s “neighbourhood first” foreign policy, sub-regional cooperation involving India, Bangladesh, Myanmar, Bhutan and Nepal makes a compelling proposition. It is in this context that one has to see India funding the cross-border rail link between Agartala and Akhaura, a project that is expected to be completed by next year.
Pallab Bhattacharya is a journalist based in India