The Hindu Business Line : Ways to leverage the waterways

`Develop inland waterways,' reads one of the imperatives suggested by an essay included in Kerala's Economy: Crouching Tiger, Sacred Cows. The book, edited by Sunil Mani, Anjini Kochar and Arun M. Kumar, and published by DC Books (www.dcbookstore.com), brings together papers presented at a December 2005 conference held in Thiruvananthapuram under the auspices of the Kerala Global Support Network, Stanford Centre for International Development, the Asian School of Business, and TiE Kerala, a chapter of The Indus Entrepreneur, a global organisation of South Asian entrepreneurs.

"Kerala's road traffic, growing at 10-11 per cent per year, places pressure on the state's roadways," note N.K. Singh and Jessica Wallack, the authors of the essay. They highlight that the state has `the unique advantage' in the form of `numerous potentially navigable inland waterways that could be developed for passenger use as well as the current cargo uses'.

With about 1,700 km of inland waterways, Kerala has nearly 12 per cent of the country's total. "The West Coast Canal alone, connecting Hosdurg in the north and Poovar, near Thiruvananthapuram in the south, is 560 km long." According to estimates, coastal shipping and inland navigation can take care of `more than a quarter of the state's transportation needs'.

First priority, say the authors, is dredging, because `canals were damaged and silted up by the tsunami'. The government should announce, clearly and credibly, its plans for improving various stretches of inland waterways, so that the private sector gets strong signals `to develop tourist amenities or industrial areas that can be accessed via the waterways'.

Some stretches of inland waterways can be feasible projects for the private sector, suggests the essay. "Tolling regimes similar to roads could easily be developed for the `intersections' or stretches linking already developed areas."

Singh and Wallack emphasise the need for `projectisation' skills. Project evaluation is a new ability to be learned, they say, suggesting a move toward business-oriented accounting, in which fixed assets' value as well as depreciation/ maintenance costs would reduce public agencies' cost of borrowing.

"Road agencies' budgeting has little in common with commercial accounts and is difficult to compare across States or evaluate," rue the authors. This may, perhaps, be an area where the Institute of Chartered Accountants of India can chip in.

Accountability and transparency are the most important issues in public expenditure management, concedes the essay. An apt quote in this context is of the Finance Minister, cited by the authors: "There is much to be done in terms of reform of delivery mechanisms, spending, auditing and accounting, and the legal system. You must be able to stand up and say, `I spent Rs 1,000 crore and have got a 1,000 km rural road'... that connection between outlay and outcome has to be established."

Thought-provoking.

D. Murali