Tata Steel: Setting sail for a sustainable supply chain

This is because of the huge dependence on the road network. We have now reached a point where almost two-thirds of our movement is by road. Railways has become a major player in the longer distance connectivity and roads took over the shorter distance coverage. Also, roads act as a major contributor in multimodal connectivity. What has really struggled in the country is the waterway movement. However, the Centre is taking efforts to improve the two modes [coastal and inland waterways] of transport.

I believe that the road percentage will come down over a period of time and a part of it will be replaced by the river waterways. Today, river waterways may constitute less than 2 per cent [of total cargo movement] and, over a period of time, this may become 5 per cent. Coastal movement will open up as India starts to get appropriate-sized ships and the rail network will continue to expand as we start increasing the speed of rail.

Yes, it is important to take action on both these modes of transportation. This government is already taking action. Tata Steel is located in the eastern part of India while the markets are in the north, south and west. Rather than relying on road or rail, both of which are much more expensive, we need to use more coastal transport and waterways. That’s the plan going forward.

Annually we transport nearly 20 million tonnes of finished goods from Jamshedpur, Kalinganagar and Meramandali plants — 75 per cent of it by rail, 24 per cent by road, and one per cent by coastal and waterways domestically. In the future, waterways and coastal movement could touch 5 per cent for domestic cargo movement. At Tata Steel, supply chain related to the movement of raw material and finished product in the future must have a proportion of road, rail and waterways. For raw material, slurry pipeline is also coming up as a good and sustainable option. We want to move beyond rail and road, and get more into coastal movement and waterways.

Waterways are essentially for the North-East and small quantities to Bangladesh. The North-East is a very small demand market. Today, Tata Steel is one of the largest sellers in the North-East. So, for Assam and the other states there, every month we sell 12,000 to 13,000 tonnes, of which we intend to move at least 1,000 tonnes by waterways. This means we will put the cargo on a river to go through the Bangladesh route or up the river system to reach Assam. For lower Assam, the location is Pandu or towards Tripura and Agartala. We can even take it to Nepal. We are working on multiple waterways. 

Uniform draft is one of the major issues. We cannot load more than 1,000 tonnes of cargo on a barge. We require 2 m or 2.5 m draft and in that also we can only move during daytime, as night navigation is not available. Our rivers have very heavy silting and it is also used for a number of other applications. People movement also happens in a big way. We have to use a very narrow path.

We will focus on using the coastal route to reach markets in the west and south. We are confident of moving close to one million tonnes, out of 20 million tonnes, through coastal transport. On the waterways, moving 100,000 tonnes will be a significant achievement and will open the river waterways as a viable option for cargo movement.