Syllabus: UPSC / APSC – General Studies Paper II (Governance & Public Policy), Paper III (Infrastructure & Transport)

Why in the News?

The Assam government has initiated the unbundling of the 68-year-old Inland Water Transport Directorate, transferring its assets to the newly formed Assam Inland Waterways Company Limited. This move is part of a World Bank-funded modernisation project worth ₹700 crore, but it has raised concerns among employees and stakeholders.

What is Unbundling?

Unbundling means separating a single government department into distinct operational and regulatory bodies.

• The existing directorate will be split into:
  • An operational company for ferry services.
  • A regulatory authority for oversight and safety.
• All vessels and assets have been transferred to the new company.
• The newly built Guwahati terminal (₹305 crore) has been put up for lease.

This reform aims to improve efficiency, accountability, and financial sustainability.

Importance of Inland Water Transport in Assam

The economic and strategic importance of Inland Water Transport (IWT) in Assam:

1. Strategic Connectivity & Trade

• Bypasses the “Chicken’s Neck”: Provides a critical alternative route to the narrow Siliguri Corridor, easing logistical bottlenecks for the entire region.
• Act East Policy: Connects landlocked Assam to Bay of Bengal ports (like Chittagong and Mongla) via the Indo-Bangladesh Protocol (IBP) Route, transforming it into a transit hub for international trade.

2. Economic Benefits

• Cost-Effective: Highly economical for moving heavy, bulk commodities (coal, cement, tea, petroleum). Operating costs by water are significantly lower than road or rail.
• Fuel Efficient: One liter of fuel moves 105 ton-km by water, compared to 85 by rail and just 24 by road.

3. Infrastructure & National Waterways

• NW-2 (Brahmaputra): An 891 km stretch from Sadiya to Dhubri.
• NW-16 (Barak): A 121 km stretch from Lakhipur to Bhanga.
• Current Affairs Push: The government recently announced an investment of over ₹4,800 crore for Assam’s waterways, which includes developing ship repair facilities at Pandu, Water Metros in Guwahati and Dhubri, and riverine lighthouses.

4. Social Impact & Environment

• Lifeline for Riverine Communities: Ferries and Ro-Ro services are the only connectivity for the massive population living on isolated river islands (chars), such as Majuli.
• Eco-Friendly: Significantly lowers carbon footprint, decongests highways, and entirely avoids the complex land acquisition issues associated with expanding road or rail networks.

Concerns and Challenges

• Around 2,600 employees face uncertainty about job security.
• Fear of fare hikes and phased privatisation.
• Revenue is about ₹10 crore annually, while government expenditure is ₹200 crore.
• Questions remain about long-term financial viability without state support.

Why Modernisation is Needed

The World Bank-supported project includes:

• Modern terminals and navigation aids.
• Emergency response systems.
• Capacity building and reskilling of staff.
• Strengthening institutional framework.

It aligns with national initiatives such as the Inland Waterways Authority of India Act, 1985 and the National Waterways Act, 2016, which promote inland water transport as a cost-effective and eco-friendly transport mode.

The Core Issue

The reform reflects a larger governance debate:
How to improve efficiency without compromising the social responsibility of essential public services?

Exam Hook: Key Takeaways

• Unbundling separates operational and regulatory functions.
• Linked to ₹700 crore World Bank-supported reform.
• Inland waterways are crucial for Assam’s connectivity.
• Raises governance issues of public utility versus commercialisation.

Mains Question:
Discuss the challenges of reforming public transport utilities in India, with special reference to inland water transport in Assam.

One-line wrap: Assam’s inland water transport reform is a test of whether modernisation can coexist with equity and public welfare.

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