Regional Meeting for Cooperation Facilitation of International Railway Transport. R. Dayal AITD

Transcription

1 Regional Meeting for Cooperation Facilitation of International Railway Transport R. Dayal AITD Bangkok October 2014

2 The Future beckons The world transforms Globally, population grows; we live longer. Three billion humans lived on the planet in 1960; in 2050, world population could reach 9 billion. Besides growing urbanisation, ageing is a major driver for change By 2050, China will be older than Europe The world economy s centre of gravity is shifting By 2050,Asia will be producing more than half the world s output. World GDP could possibly double over the period to 2030.As a result Air freight could triple in 20 years, growing 5.9% p.a. Port handling of maritime containers worldwide could quadruple by 2030, maritime container traffic increasing more than 6% annually. Rail passenger and freight traffic worldwide could increase 2-3% p.a. OECD: Transcontinental Infrastructure Needs to 2030/50

3 Transport for a changing world. World factories rely on complex global supply chains as their assembly line Rapidly increasing volumes will likely be concentrated along major inter-regional trade routes, increasing shares carried by larger aircraft and vessels it lowest cost. Delays in handling at terminals/transit points will choke the arteries and add to costs. Just as the industry consolidates, so does the infrastructure it requires. Inadequate or inefficient transfer points will impair the integration and output of logistics chain.

4 Intermodal a vital facilitator Context Importance of railways Rising traffic volumes, obliging railways to increase capacity. Sustainability of modes, necessitating optimal complementarity Software of logistics services as important, if not more, as hardware of infrastructure. Railways not merely for bulk, high volume traffic. Optimizing use of existing links and assets. Simplifying procedures and documentation, harmonizing standards and legal regimes. Following good practices, regional experiences, adopting Conventions. Facilitation Not an end, a means to an end. End: cost-effective transport Time efficient Customer centric Natural partners The two most important developments in 20 th century The box (standardized container for freight) The computer (unleashing power and sweep of IT) The container has provided meaning and substance to the concepts of global manufacturing, outsourcing, J-I-T. Reduction in logistics costs, speed in transit The increasing speed and volume of trade and transport require faster information flow across the logistics chain.

5 SAARC region slow and tardy It takes on average more than 33 days to export from South Asia compared to 12 days from OECD countries. And more than 46 days to import into South Asia compared to 14 days in OECD. Goods are transhipped between the trucks at the India Bangladesh / India Pakistan border. AITD studies on India Nepal, India Bangladesh corridors show that additional burden on transport costs due to bottlenecks at land crossing stations amount to $ 6-7/t of freight. Actual cost of an average shipment from Kolkata to Bangladesh via Benapole % of the value of shipment compared to an ideal of 1.93%. This average cost can be as high as 18% for some shipments. There is no containerized cargo interchanged between India and Pakistan, India and Bangladesh. Intermodal system secures the competitiveness of railways vis-à-vis road transport. Container traffic for Lahore moves to JNP in Mumbai, then to Dubai on, to Karachi and finally to Lahore. Containers for Bangladesh are routed via Mumbai to Singapore, to Chittagong, to Dhaka. If moved on all rail route, within operational restrictions, the box for Bangladesh will save at last 1/3rd of the transit time and more than half the haulage and handling costs. Intermodal transit of goods over land route would be cheaper by 35%, faster by 70%.

6 South Asia: Logistics Performance Index Country LPI Rank LPI Score Customs performance Infrastructure quality Int l shipments (case of competitively period shipments) Logistics competence Tracking and tracing Timeliness Afghanistan Bangladesh Bhutan India Maldives Nepal Pakistan Sri Lanka Germany Total No. of countries analyzed: 160; graded on a score of 1 to 5: LPI weightage average of country scores on the six key dimensions The WB LPI, 2014 highlights high logistics costs in the South Asia region As much as 15-24% of national GDP, besides low quality performance.

7 Historically an organic system Rail network of South Asian region, prior to partition, constituted an organic system. A number of connections existed between India and East Pakistan (now Bangladesh): Haldibari (India)-Chilahati (Bangladesh); Gitaldaha (India) Mughalhat (Bangladesh); Agartala (India)-Akhaura (Bangladesh) and ; Shahbazpur (Bangladesh) Mahishasan (India). India-Bangladesh railways are now linked to each other at five points:three BG links open for freight trains Gede (India)-Darsana (Bangladesh), Singhabad (India)-Rohanpur (Bangladesh) Petrapole (India)-Benapole (Bangladesh). The other two links, though in existence, lie dormant: Radhikapur(IR)-Birol (BR) BG on Indian side, MG on Bangladesh side. Inoperative since 1 Apr 2005 Mahishasan(IR)-Shahbazpur (BR) MG. Extensive damage by floods. Nonfunctional since Dec Akhaura, earlier a rail-head, served as a major link between Chittagong port andtripura. IR has now extended its MG rail network up to Agartala, further extending it south to Sabroom. The 15km Agartala (India)-Akhaura (Bangladesh) rail line needs to be built expeditiously.

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9 India-Bangladesh traffic interchange Rail traffic from India to Bangladesh: tonne Route Total Gede-Darsana 327, , , ,009 Petrapole-Benapole 84,027 45,066 26, ,483 Singhabad-Rohanpur 26,640 1,650 91, ,530 Total 438, , ,720 1,109,022 Rail traffic from Bangladesh to India: tonne Route Total Gede-Darsana ,470 11,470 Petrapole-Benapole Singhabad-Rohanpur 19,725 4, ,723 Total 19,725 4,998 11,470 36,193 Bilateral freight traffic regulated by Fundamental and Subsidiary Rules. Major commodities exported by rail from India to Bangladesh include aggregate, gypsum, de-oiled cake, onion, sugar, maize and foodgrains. Rail-borne exports from Bangladesh to India consist of molasses, besides transit traffic of fertilisers to Nepal via IR network.

10 The Maitree Express Kolkata Dhaka Passenger train inaugurated on 14 April 2008, the bi-weekly Maitree Express runs between Kolkata and Dhaka via Gede/Darsana, completing the one way journey in 10.5 hours.

11 Some quick fix is feasible, and expedient Restoration of the old rail transport links would involve minimal investments, and result in maximum gains, in the shortest time frame. Chilahati (Bangladesh) Haldibari (India) rail link a part of the main BG route from Kolkata to Siliguri in undivided India Reopening the link will benefit interchange of traffic.track on both sides is BG. India Bangladesh had agreed in 1998 to reopen the old Bongaon Jessore BG rail line, closed since If India Bangladesh BG rail lines connect Mongla port with Bongaon via Khulna, Bangladesh exports can reach Delhi within 5-7 days. The BG rail route linking Raxaul with Khulna, if extendedtomongla,justabout35kmaway,will provide valuable connectivity for Nepal and Bhutan to Mongla gateway port.

12 India-Bangladesh: an intermodal push An inter-governmental railway meeting in 2013 reached to examine the possibility of operating container train services between the two countries. A joint India Bangladesh team recommended: An intermodal exchange yard to be set up at Ishurdi PQRS department for transhipment of containers from broad gauge to metre gauge or to road, and vice versa. Customs-bonded warehouses can also be set up for containers to be stuffed/de-stuffed, bulk cargo transported by road. For operating container trains to/from Jessore area, a container handling terminal may be set up at Singia station, located on BG section between Khulna and Jessore, about 15 km by rail from Jessore, 11 km fromnawaparaand41kmfromkhulna.thedistancebyroadis22km, 11 km and 48 km respectively from the three nodes.

13 India-Nepal India and Nepal executed bilateral agreement on 21 May 2004 for the introduction of freight train services from/to Birgunj ICD in Nepal via Raxaul in India. Container freight train services from/for third countries commenced on Raxaul-Birgunj link w.e.f. 16 July, Initially, services were confined only to transport of containers on flat wagons, besides of covered wagons (BCN/BCNA/BCX). Bilateral traffic, i.e., traffic originating from/terminating at an Indian railway station-distinct from third country traffic-carried in covered wagons and in containers on flat wagons to/from Birgunj began in February, Movement of India-Nepal bilateral traffic in tank wagons as well as third country cargo in tank wagons has been permitted since 1 January, An average of freight trains are interchanged between India and Nepal at Raxual-Birgunj.

14 Rail traffic interchange between India and Nepal: tonne Year Traffic from India to Nepal Traffic from Nepal to India Grand Total Containerized cargo Break bulk cargo Total Containerized cargo Break bulk cargo Total , , ,488 4, , , , , ,802 6, , , , , ,813 7, , ,958 Total 912,230 1,349,873 2,262,103 18, ,765 2,280,868

15 Container transit between Kolkata port and ICD Birgunj / Raxaul Average transit: Kolkata port to Raxaul/Birgunj Each way: days Average total time from arrival at port to Birgunj / Raxaul and back to port: days Year Rail Road Rail Road (Apr-Aug) India-Nepal container transit Appx. cost of transport from Kolkata to Birgunj and back to Kolkata Rs. Freight: tone Rail Road > ,000 55,000 > ,000 70,000 >26-52, ,000

16 Containers for Nepal at Kolkata port NEPAL Raxaul/Birgunj Biratnagar Bhairawa Kakarbita/ Naxalbari Others YEAR Total import boxes Total Containers for Raxaul Carried by CONCOR/ Rail By Road % by CONCOR of total Raxaul Biratnagar Share % Bhairawa Share: % Naxalbari Share: % Others Share: % ,342 N.A. 4,600 N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A ,706 15,713 8,784 6, N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A ,669 17,332 10,722 6, , , , , ,506 20,302 14,163 6, , , , ,664 20,050 14,643 5, , , , ,648 26,281 17,193 9, , , , , ,304 27,880 18,993 8, , , , , ,880 25,913 18,264 7, , , , , ,839 28,446 20,674 7, , , , , ,179 27,897 17,980 10, , , , ,

17 The more the things change, the more they remain the same Around two-thirds of containers received for Nepal at Kolkata port, for Birgunj ICD, are movedbyrail,therestgobyroad. Light weight cargo in containers, such as electronics and other high value goods, generally move by road-found to be cheaper than rail. Dwell time for rail-borne containers at Kolkata port is high. Shipping lines do not issue through bill of lading for Birgunj ICD-bound containers inasmuch as there is huge imbalance of exports from, and imports into, Nepal. Delays at port, including for availability of railway rakes would result in detention charges payable by shippers to shipping lines. CHAs observing holidays and working only during day light hours delay the processing of cargo. There is long one-way transit time for container trains-to the extent of 4 daysfrom Kolkata port to Birgunj. Customs at Raxaul do no inspection of containers on trains at night. Any mismatch, deficient or missing seal on a container leads to detention of a minimum 24 hours to the train at Raxaul. The crucial EDI connectivity remains elusive, thus negating the potential gains to accrue from an integrated logistics value chain of containerised cargo.

18 India-Pakistan There is minuscule rail passenger and freight traffic interchanged between India and Pakistan. Passenger During the period January August 2014, the Samjhauta Express made 8-9 trips each way in a month ferrying a monthly average of 1,437 passengers from Pakistan to India, and 1,874 passengers from India to Pakistan. Freight While Pakistan moved a monthly average of 48,988 tonne in 89 wagons (mostly cement, rock salt, soda) during January-August 2014; India transported 131,328 tonne of cargo in 217 wagons on a monthly average (mostly plastic granules, soyabean, chilly). Parcels Pakistan exported by rail a montly average of 1,372 tonne of parcels (mostly dry fruit, apparel, footwear) to India during the eight months January-August 2014, whereas India sent to Pakistan by rail a monthly average of 23,676 tonne of parcels (mostly vegetale feed, books, cardamom, hosiery, sewing, machines, drugs).

19 Samjhauta & Thar

20 India Pakistan: several rail links There used to be several rail connections between India and Pakistan. At present only Attari-Wagha and Munabao-Khokhrapar links (both on BG) are operational. Attari-Wagha route is used to run both freight and passenger services. weekly passenger service runs through Munabao- Khokhrapar. Other links which are no longer in use: Sialkot (Pakistan)-Jammu (India). Dera Baba Nanak (India)-Jassar (Pakistan) Hindumalkote (India) Mandi Sadiq Ganj Jn.(Pakistan) Fazilka (India) Mandi Sadiq Ganj Jn. (Pakistan) Hussainiwala (India)-Gainda Singhwala (Pakistan), and Khemkaran (India)-KasurTehsil (Pakistan).

21 Trans Asian Railway Network UNESCAP under its Asian Land Transportation Infrastructure Development (ALTID) project identified three Trans Asian Railway routes: Northern Corridor which passes through Russian Federation, Kazakhastan, Mongolia, China and Korean Peninsula, TAR in the Indo-China and ASEAN sub- region starting from the Chinese border through Lao People s Democratic Republic and Thailand up to Malaysia (with linkages connecting Myanmar, Cambodia andvietnam), and The Southern Corridor comprising Turkey, Iran, Pakistan, India, Nepal, Sri Lanka and Bangladesh in South Asia. The Southern Corridor now commences from Kunming in China, passes Bangkok in Thailand, and ends at Kapikule in Bulgaria.

22 Northern Corridor TAR northern corridor, although not in reckoning in the initial TAR concept, bristles with immense possibilities of a Eurasian rail bridge to grow substantially. There are already several operators vying for the growing pie of intermodal business through TSR route as well as rail links across Central Asia. They operate container services, transporting high value, time-sensitive freight, e.g., computers, auto components, FMCG. Achieving transit of days for the 11,500 km journey, which in due course can even be paredto8-10days. Today, rail carries over 1m TEU from East Asia to Europe (UIC), enabling shippers save transit time more than half (20 days by rail vs 50 days by sea). RZD working for the Trans Siberian Seven Day rail transit programme, aiming at a reduction of $ 400 per container. The UIC-sponsored Intercontinental Combined Traffic study, 2011 identified five corridors for the Eurasian railbridge, with an annual potential of $ billion. The Eurasian container market is expected to reach 17.4m TEU in 2020 and 22.7m TEU in A rail market share of just 5-6% would yield, by 2020, a throughput of about 500,000 TEU annually.

23 Southern Corridor Pending the construction of Kunming-Myanmar, Thailand-Myanmar, Bangladesh- Myanmar, India-Myanmar missing links, Southern corridor can work from near Dhaka to Istanbul/Europe via Zehedan. Trial container trains from Dhaka to Delhi, to Lahore, to Koh-i-Taftan, to Zahedan are indeed overdue. The corridor commands a unique advantage of only one transhipment for breakof-gauge at Zahedan between Dhaka and Istanbul, in fact, Europe. ECO- supported container train runs from Pakistan to Turkey via Zahedan (Iran).

24 India Nepal: Rail routes contemplated Rail routes surveyed for Nepal Project Length: km Estimated Cost: Rs. billion Rate of Return: % Jaynagar-Bijalpura-Bardibas Nepalganj Road-Nepalganj Negative Nautanwa-Bhairahawa Jogbani-Biratnagar New Jalpaiguri-Kakarbitta The Jaynagar-Bardibas and Biratnagar-Jogbani lines taken up for execution. Ministry of Physical Planning and Works, Nepal got a techno-economic survey done in 2006 for a rail line to connect Birgunj with Kathmandu. The survey estimated the 160 km long BG electrified rail line to cost Rs 30 billion.

25 India Bhutan: Rail routes contemplated Project Rail routes surveyed for Bhutan Length: Estimated km Cost: Rate of Return: % Rs. billion Banarhat-Samtse (A) Hasimara-Phuentsholing (B) Kokrajhar-Gelephu (C) Pathsala-Nganglam (D) Rangia-Samdrup Jongkhar (E) ThBhutan does not have a railhead; it is dependent on New Jalpaiguri- Guwahati BG line for rail transportation. The Hasimara-Phuentsoling line, which will connect Bhutan to IR BG network, has been proposed for construction. A B C D E

26 Myanmar a crucial land-bridge Myanmar constitutes the crucial missing link or land-bridge between India and South-east Asia. Rail linkages envisaged in the Trans Asian Railway project include connections to Moreh in Myanmar from Jiribam in Manipur via Imphal. Work is progressing on the construction of a 98km new line between Jiribam and Imphal. The Kaladan multi-modal transport project envisages use of riverine and road transport to connect Sittwe with Mizoram and Manipur. A railway line from Silchar longitudinally through Mizoram connecting Sittwe port will provide access to the land-locked regions of North Eastern India, in particular, states of Mizoram, Manipur, South Assam and Nagaland.

27 Sri Lanka the link in the south There is no physical connection between railway systems of Sri Lanka and India. A railway line earlier existed up to Dhanushkodi near Rameshwaram, from where there was a ferry service totalaimannar in northern Sri Lanka. This link was destroyed in a cyclone in December Since then, railway link to Rameshwaram has been restored and upgraded to BG. The link to Dhanushkodi remains disrupted.

28 South Asian integration SAARC looked at SAFTA, then a Customs Union by 2015, and an Economic Union by An economic union connotes integration of markets, ease of travel and trade, and cultural interaction. South Asia needs much greater economic integration, but it remains world s least integrated region. The main reason is absence of seamless transport connectivity. Rail transport has potential to provide seamless transport. Although railways in the subcontinent constituted a unified system across India, Pakistan and Bangladesh, the effective rail connectivity among these countries is negligible. Integration is a dominant theme in the development of logistics management. Trade becomes the centre-piece of the inter-connections.

29 Optimal utilisation of existing assets Without optimising the utilisation of rail network for intra-regional trade, goals of economic integration will remain elusive. The existing constraints-loop lengths and hauling capacity limitation, axle load restrictions, braking system, coupling, and other technical and technological variations must not daunt. The software part of the infrastructure really vital. EDI connectivity under a synchronized system enables expeditious clearance at the border. Simplified procedures like through bill of lading or combined transport document can facilitate. Measures like visa-free travel between countries and single-point customs and immigration checks will facilitate.

30 Portents of hope? Immanuel Kant s tripod of a liberal regional order: Democracy Economic interdependence Institutions Incipient though, these three columns of the tripod have now been progressing in South Asia. For the first time in region s history, all the eight regional states now have democratically elected governments. Economic interactions amongst regional states demonstrate an upward trend: for example, intra-regional trade increased from 2.7% in 1990 to 4.3% in 2011 (in a total $ 623 billion international trade in the region). Following the footsteps of European Union and ASEAN, South Asian states launched SAARC in South Asia harbours almost one-third of world s poor. Economic growth rides on transport. Hopefully, people in the region will realize they need throbbing transport corridors for their place in the sun. An initial 10,000 tonne parcel of rice for Tripura has been shipped from India to Ashuganj river port in Bangladesh, grain finally delivered on Bangladeshi trucks to FCI warehouse in Agartala. It can well be an inflexion move forward.

31 Thank you