Tuesday, March 01, 2005

Developing new trading avenues

The North-Eastern part of India has long suffered from economic stagnation for a variety of reasons. One of them is the absence of access to a warm water port. The journey to Calcutta is too long and tedious to economically transport perishables or non-perishables. The most obvious solution would be the usage of Bangaldesh's Chittagong port. But Bangladesh is Bangladesh - the scorpion that bites the frog carrying it in the middle of the river. So we move on to the next best option - Burma (or Myanmar)!

In an indication of the rapid strides made by the UPA Govt in cultivating links with the Burmese junta (while support for democratists through George Fernandes remains), that India now has not just a stake in Burma's oil and gas industry, but also is on the verge of getting access to a port. The idea is to link the NH-54 in Mizoram to a the Kadalan river in Burma at Kaletwa. Next the river will be dredged to provide ships access to the Sittwe port, which will also be developed as part of this project. The total duration could be 48 months. While India will finance the bulk of the operations, Burma could waiver transit fees for at least 5 years.

On the Western front, India finds that Afghanistan, and the Central Asian republics beyond present it a huge market. However, the other scorpion lies in between. Currently India exports goods via a ship-road link through an Iranian port, but this route is far more expensive than a direct road link would be. Needless to say, Pakistani support is the key to India cultivating Central Asian markets for itself.