India to complete Myanmar port project in May

India will complete the reconstruction of Sittwe port and the associated river transport facilities, as part of the Kaladan Multi-modal Transit Transport Project in Myanmar, in May this year.

The project cost, however, is expected to be 29 per cent higher at ₹450 crore, compared with the initial estimate of ₹350 crore, largely due to unexpected volatility in exchange rate, say sources.

The rupee-denominated project was awarded at a time when one dollar was fetching ₹44 and Myanmar Kyat 900. Both the currencies are now ruling at much lower levels.

“The port and the river transport facilities will be ready for operations within the extended timeline of May 2015,” a Government official told BusinessLine.

While the commissioning of the port-cum-waterway will surely boost bilateral relations, India has to wait for years to start transhipment of goods to Mizoram in the North-East, as the Ministry of External Affairs (MEA) is yet to kick off the road transport part of the Kaladan project.

Having originated at Chin Hills in Myanmar, Kaladan river flows through Mizoram and back into Myanmar’s Sittwe Delta in the gas-rich Arakan peninsula.

Once one of the two most important river ports in Myanmar, Sittwe was used to ferry supplies to the northeast of India during the British Raj. From Sittwe, the cargo was taken by waterway 170 km upstream at Paletwa – where the river encounters rapids – for further travel by head-loads to neighbouring Mizoram. According to a 2008 agreement between the two nations, the MEA proposed to revive this route to establish easy access to North East.

Apart from trade and commerce, the project has immense importance in ensuring India’s political and military interests in the region rivalling China.

Kaladan Multi-modal Transit Transport Project has proposed to revive the river transport route up to Paletwa and build a 129-km-long two-lane highway (NH-502A) through the hilly terrains of Myanmar to connect NH-54 at Lawngtlai in Mizoram.

This would reduce the distance from Kolkata to Aizwal by less than half from the existing 1,550 km. In 2010, Delhi awarded a turnkey contract to improve the navigability of both Sittwe port and river channel, build terminal at Paletwa and handover six self-propelled barges to Naypyidaw. The project is now nearing completion.

But the road project, estimated to cost ₹2,900 crore in 2010, is hanging fire, as contracts are yet to be awarded. Enquiries by Business Line in both Myanmar and India failed to throw any light on the reasons behind the inordinate delay.

“We have no news to share,” said Khin Maung Lynn, Joint Secretary I of Myanmar Institute of Strategic and International Studies, a Yangon-based think tank. Talking on condition of anonymity, an MEA official blamed poor project monitoring and fund crisis as two probable causes. “While the prolonged delay escalates costs, the budgetary constraint of the ministry come in the way of implementing projects,” the official said.