Transport Connectivity in South Asia and Beyond

High-Level Policy Dialogue on
Challenges facing the Sub-Region
15-16 December 2011, New Delhi
Transport Connectivity
in South Asia and Beyond
Asian Institute of Transport Development
Past to Ponder

In the sixteenth century, the Indian subcontinent comprising much of South Asia
accounted for about a quarter of the world’s
GDP. By the middle of 20th century, this share
had declined to barely 2 percent.

In the last 20 years, South Asian countries have
just doubled their per capita income; China has
increased it six times; and the rest of East Asian
countries have trebled or quadrupled theirs.

Regional cooperation has not delivered either on
promise or potential. Hostage to closed and
divisive mindsets, distrust of neighbours and
institutional insensitivity to high incidence of
poverty.

Restrictive policy regimes have neutralized the
beneficial effects of common cultural affinity,
common geography, and the ‘gravitational’ pull of
proximity on movement of goods and people.

Presently, South Asia has the least reported intraregional trade of any developing country
grouping.
Snapped Links and Consequences

Division of the sub-continent led to creation of
extensive land borders (7419 km), mostly unnatural
and porous disrupting geographic space, economic
and transport linkages.

Rail and IWT transit across the then East Pakistan
continued till 1965 and was then suspended. Only
IWT transit restored in 1972. Transit through
Pakistan stands suspended.

Border management led to closure of historical land
routes at several points. North-East India virtually
became a landlocked territory.
Half-hearted and Faltering Steps

Present levels of connectivity and services are a
mere reflection of the restrictive policy regimes.

Six decades have seen only half-hearted steps to
restore some of the transport linkages. Land
transport facilitation agreements still not
finalized.

Meanwhile, incompatible transport technology
platforms
have
emerged,
impairing
interoperability
of
cross-border
services,
particularly of rail transport.
Economic Cost of Disruption

In 1948, intra-South Asia trade was 18 percent of the
total trade and today’s border area were relatively
wealthy. By 2010, this share dropped to mere 6-7
percent.

Trade transaction costs are high ranging between
13-14 percent of the commodity value compared to
7-8 percent in developed countries.

Additional burden on transport costs due to
bottlenecks at land crossing stations between
Bangladesh and India work out to US$ 8 to 10 per
tonne of freight.

A 20’ container takes at least 30 days to move
between New Delhi and Dhaka via circuitous
routes, and costs around US$2500, but by land
transport it could reach its destination in about 56 days with around one fourth of the cost.

Large volume of trade between India and Pakistan
is routed through Dubai.

Skewed transport interchange matrix between
Bangladesh and India is a classic example of the
closed mindsets.
Element
Transit through
Bangladesh*
Access of vehicles/
vessels across the
border
Passport requirement
for the crew
Visa requirement for the
crew
Rail
Presently not allowed.
Road
Allowed. There is a protocol
between the two countries on
Inland Water Transport and
Trade (04/10/99), derived
directly from the provisions of
Article VIII of the Trade
Agreement.
Goods trains from India
Different practices prevail: in case of
Vessels belonging to the two
are allowed upto the next Petrapol-Benapol interchange point, road countries permitted to ply over
station across the border. vehicles are permitted up to the customs
the designated waterway
While the locomotive is
warehouses in Benapol situated one km
routes and up to the
returned with or without a away from the border.
designated riverine terminals.
load, wagons are left
At Dawki-Tamabil interchange point, road Transportation of cargo is
behind for commercial
vehicles carrying coal permitted up to coal shared equally between the
handling, for which the
dump at a distance of three km from the
two countries.
Bangladesh Railways pay border.
detention charges to
Indian Railways.
Yes
No
Yes
Multiple entry visas valid
for a period of one year
are granted to the railway
staff to be on duty in
connection with
interchange of rail traffic.
Presently not allowed.
Ropeway/
Conveyor Belt
Waterways
N. A.
There is a seven km long
elevated conveyor belt of Lafarge
Umiam Mining Pvt. Ltd. from the
crusher site of the company,
passing along a 40 metre wide
strip of land comprising villages
of Phlangkaruh, Bamantilla and
Umkhaba on the west and
Pyrkan, Kalatek villages and river
Umiam on the east to Mantrikhal
village of Bangladesh
N. A.
At the Petrapole-Benapole interchange
Officers supervising or
N. A.
point, the truck crew are allowed up to the controlling the fleet of the
warehouses without any passport or
operators in either country are
official permit.
required to carry passports
In case of Dawki-Tamabil interchange
endorsed with multiple entry
point, the Bangladesh customs authorities visas. For personnel manning
issue a temporary permit valid for
vessels, no visa required.
specified hours impounding the driving
licence of the truck driver.
Note : 1.* Article VIII of the trade agreement lays down: “the two governments agree to make mutually beneficial arrangements for the use of their waterways, roadways and
railways for commerce between the two countries for passage of goods between two places in one country through the territory of the above.”
2.** Limestone and shale transportation over a 17 km long belt conveyor from a query in Meghalaya to Sunamgarh in Bangladesh.
The World Shows the Way

Transport and communications form an
important component of regional cooperation –
ASEAN, NAFTA, MERCOSUR, SADC.

Emergence
networks.

Development of new inter-country corridors –
TRACECA (Europe-Caucasus-Asia), ECO.
of
Trans-European
transport
Iran Develops Rail Network only for
Transit Traffic
Kazakhstan Builds Rail Route to Link
Europe with China
Jordan Developing Rail Links for
Transit Traffic
Asian Highway Route Map
Trans-Asian Railway
Beneficial Impact of Transshipment Traffic

Transshipment traffic would account for trade in
services and thus benefit the trade between the
transit countries.

The additional traffic would improve the viability of
the relatively smaller rail systems which presently
do not have the minimum critical mass.

Experts have estimated about 18 million tonnes of
inter-state and international traffic for Bangladesh
as a transport hub for south and south-east Asian
region.
Recent Initiatives

SAARC multimodal transport study has identified key
priority transport corridors such as:
• Central Asia-South
Pakistan
Asia
via
Afghanistan
&
• East Asia-South Asia via Myanmar & Bangladesh

SAARC Declaration of 2010-2020 as decade of intraregional connectivity.

Recent agreement on regional connectivity between
Bangladesh and India during 2010.

Recent initiative of Bangladesh to sell seaport
services to Bhutan, India and Nepal.

India has also agreed to provide transit facilities for
traffic from these sea ports in Bangladesh for
destinations in Bhutan and Nepal.

Designating a new port of call and transshipment port
on the inland waterways of Bangladesh for onward
connectivity to Tripura in India.

Allowing bilateral container traffic between India and
Bangladesh to be carried by both rail and IWT.

Extending the Indian Railways network to the inland
container depots in Nepal and Bhutan.

Opening of new trading points along the border
between India and Bangladesh.

Reintroduction of suspended ferry services between Sri
Lanka and India.
Benefits of Proximity

Distance does matter, more so in the context of
looming depletion of fossil fuels. Rising freight
charges will give a fillip to the trend towards
making products closer to the market.

Regional rather than global production networks
are likely to become more important in future.

Availability and access to relevant technologies
in the neighbouring countries would be costeffective in the long run and would also bring
about harmonization of transport technologies.
Direction Markers

Pending integration at the regional level, subregional
cooperation
could yield substantial benefits.
Subregional building blocks would facilitate longterm development of regional networks.

There is considerable merit in following a path of
unilateral initiatives as the long-term benefits would
far outweigh the short-term costs.

Restoration of the transport links by rail, road and
waterways would involve minimal investments and
would result in maximum benefits in the shortest
time-frame.

Trans-Asian Railway and Asian Highway networks
would facilitate emergence of new land transport
linkages at the regional level.

Chittagong port provides the most cost-effective link
for the North-eastern part of India.

Restoration of exchange of goods and produce of local
economies would mitigate the hardship of the people
living along the borders.

Need for providing road links to the informal markets at
the borders for exchange of goods and produce.

In the eastern and north-eastern parts of the subcontinent, riverine routes can provide a costeffective and environment-friendly mode.

Projects that have a regional footprint like a bridge
over river Jamuna should be treated as regional
projects so as to reflect the larger gains to the
economies.

Multilateral bodies should prepare and fund transport
projects on inter-country network basis.

Overland multimodal transport infrastructure should
be encouraged to gain benefits in terms of cost
reduction, speedy and safe movement of goods.
Softer but Important Measures

Fuller benefits of infrastructure facilities cannot
be achieved unless parallel measures are taken to
improve procedural and operational efficiency.

A set of international conventions and
agreements
which
facilitate
cross-border
movements by different modes of transport have
evolved over the past 50 years and have been
operationally tested in Europe and other member
countries of the United Nations.

An “off the peg” system is available with the added
advantage that the necessary documentation has
already been developed. This provides an
opportunity to compress the time-scale to evolve a
framework for land transport facilitation in South
Asia.

The international conventions describe general
principles and leave the details to be agreed on a
bilateral or multilateral basis. They do not cause any
infringement of the sovereignty of the country.
Promotion of Socially Beneficial
Modes of Transport

Railways and inland water transport should be
promoted in the sub-continent keeping in view their
relatively benign impact on environment and the
growing scarcity of fossil fuels.

Changes in technology and operating environment
require far-reaching transformations in the skill set of
the personnel.

Relatively smaller systems do not have the necessary
wherewithal to support training institutions in all
disciplines. Apparent need for cooperative effort in
the area of human resource development.
NGO Initiatives

Regional cooperation need not be only at the
government level. Non-government organisations
having a regional base also have an important role
to play.

UNESCAP Ministerial Conference (2006) noted with
appreciation the valuable role of the Asian Institute
of Transport Development in arranging training
courses for railway personnel from South and
South-East Asia to assist in the development of the
Trans-Asian Railway network.
AITD’s Contributions

Asian Railways Association established to
promote cooperative research, harmonization of
hardware technologies and operational practices.

Nurturing merit and talent through award of
scholarships is one of the noblest initiatives of
AITD. Programme has been extended to South
and South-East Asian countries.

Need for building an adequate corpus with
contributions from the member countries to
support the programme on a long-term basis.
Mobilization of Resources

Extension of line of credit by member countries for
executing transport projects.

Resources provided by multilateral funding agencies –
ADB, World Bank, etc. – for infrastructure development.

Garnering of funds through the mechanism of publicprivate partnerships.

Mobilization of additional resources by levy of a fee on
EXIM traffic to be used for upgradation of facilities at
the borders.

Setting up of a dedicated infrastructure fund with
contributions from the member countries and
multilateral bodies.
South Asia and Beyond Linkages

Transport projects are an essential component
under various regional groupings (SAARC,
BIMSTEC, Mekong-Ganga Cooperation). Need for
their integration.

Trans-Asian Railway and Asian Highway
networks would provide the regional linkages.
Need for countries to sign operational
agreements.

Bilateral or sub-regional initiatives would be
instrumental
in
providing
the
necessary
connectivity.

Some of the initiatives underway are:
• Kaladan multimodal transport project between
Indian ports on the eastern seaboard and
Sittwe Port in Myanmar and its inland
extension.
• Upgradation of inter-country road linkages like
Tamu-Kalewa-Kalemyo road in Myanmar.
• Revitalization of Stillwell Road from Ledo in
India to Myanmar.
• Pakistan-Iran rail link (Karman-Zahidan).
New Silk Route

The idea of a ‘New Silk Route’ linking South Asia to
Central Asia via Afghanistan to revive the land links
that are nearly 2500 year through a network of routes
that moved merchants and preachers, goods and
ideas across the vast Eurasian landmass.

For Kabul turning Afghanistan into ‘Asia’s
roundabout’ is at the heart of the strategy to make it
economically self sustaining.

Building a New Silk Route has become a major
component of the global strategy to secure
Afghanistan’s future beyond 2014.
The Take-away

Transport networks are basic instruments for
economic growth and poverty alleviation. Make
use of infrastructure already in place in the region.

Make borders irrelevant and aim at integrated
seamless South Asia.

Promote
investment
in
inter-country
infrastructure. Develop socially beneficial modes
of transport.

Regional rather than global production networks
are likely to become more important in future.

Take advantage of pull of proximity on movement
of goods and people.

Historic opportunity to be a part of resurgent
Asia. Noticeable shift in epicentre of trade from
West to East.

Regional
integration
would
strengthen
democratic polity that has emerged in South Asia.

Technical issues must not be held hostage to
antagonistic political environment.