Rail versus inland water transport: a comparative costs study based on the movement of coal in India

This paper makes an attempt to fill some of the gaps present in the literature related to various modes of transport in India. It presents a comparative cost study of rail and Inland Water Transport (IWT) in the Indian context. The case of railway transport is based on the existing construction and operation norms of Indian Railways. In contrast, IWT cost parameters are based on discussions with manufacturers of barges in India and operators of barges carrying coal for Frakka Thermal Power Plant in the Ganges. The estimated results suggest that water ways in India have a comparative advantage over the rail in terms of capital costs (including its various components), climate change cost of environmental costs and social (health and accident) costs as these costs are much lower in case of IWT as compared to railways. However, IWT has no comparative advantage in operation. Estimates indicate that operation and maintenance cost of railways with electric traction is lower than that of IWT mainly because of less fuel consumption. All this indicates that there is a need to develop given waterways and introduce efficient barges in water transport so that it can compete with other modes of transport like Railways. In fact, IWT has characteristics to facilitate a system that meets the requirement of an efficient and sustainable transport system which is cost-effective in operation when compared with railways.