BIMSTEC collaboration: Stepping up growth
There are positive signs of change in India’s East and Northeast regions. Bangladesh and Nepal have proposed small but significant steps to improve regional power and road connectivity during the last few days.
Nepal has suggested the movement of goods from Kathmandu to Kolkata Port by using the river route via Bihar and West Bengal. The movement of rice, heavy machinery, and other cargo from India through Bangladesh to Tripura and Bangladesh itself using the waterways has already begun.
Bangladesh has decided to secure another 100 megawatts of power from Palatana power station, Tripura, raising to 600 MWs its daily intake from India. Top automakers are pressing the Centre to arrange for the delivery of cars and bikes using the river channel linking Varanasi to Haldia.
Further, power experts in Bangladesh estimate that the region can save as much as $9 billion annually through a better-integrated grid network. The objective is to ensure that India as the largest producer can transfer power to neighbours like Bangladesh in real time. This can catalyse the process of faster growth within the South Asia region, by cutting down on production time and pollution.
The potential for an integrated development of the power sector along with a higher regional power trade remains largely untapped. Dhaka-based media reports claim that carbon emissions can be reduced by 8 percent through better connectivity and technology. The present situation regarding emissions that remain high is mainly because most countries in the BIMSTEC region rely on coal as the primary fuel.
The use of coal can be reduced in the long term by putting up a regional gas pipeline network as proposed by Thailand and Bangladesh, seeking to use the abundant energy resources of the Bay of Bengal. The UNCTAD and other agencies are taking an active interest in the project. It will also help concerned governments in the BIMSTEC region to make power available to millions of households still without electricity.
Being located geographically at the centre of the BIMSTEC region gives Bangladesh a significant advantage. It can reach out to the biggest market in India to its West and the relatively affluent Thailand on its South-east. On the path to accelerated industrialisation, Bangladesh will use $.4.5 billion in 27 power development projects in the next few years, with Chinese financial assistance. There will be upgradation of the existing network, ensuring expansion and better transmission, control, and transfer systems.
On the transportation side, Kolkata will be linked with Khulna in Bangladesh by rail, with passenger and cargo movements to begin from January 2017. At present, Kolkata is liked with Dhaka, with plans for extending the link to Chittagong port in the future.
The importance of Kolkata as a major transit point for Bangladesh, Nepal and Bhutan is significant. The linkage with Bangladesh by rail and road was operational before 1947, and it is only being revived. However, in the new millennium, there are other factors as well. Kolkata is crucially important because it is the nearest very large market for Dhaka, as well as a major transit point in its right. The city is well connected with other national and international centres.
Bangladesh is keener than others to make the BIMSTEC, whose Secretariat is in Dhaka, work effectively. The BIMSTEC”s growth and present record are encouraging for its member countries. In 2000, the grouping secured a total FDI of $8 billion. By 2008, it rose to $58 billion, dropping to $46 billion in 2013 as an international economic recession began. India and Thailand did better than others in attracting FDI on account of their stronger economies. Analysts feel that at a time FDI has been difficult to secure, Delhi could look at its BIMSTEC options more carefully.
“There is little doubt that this (BIMSTEC) remains a pocket of growth, albeit on a small scale, but a bright spot in the backdrop of a gloomy economy. Even during the present difficult years, BIMSTEC countries have over the last decade managed to register a 6 percent or more annual rate of growth. This alone should convince our policymakers that for the present, the Look East policy remains our best option for growth,” says a Kolkata-based analyst. Intra-regional GDP within the region stands at $2.8 trillion, while the overall level of business and trade is $38 billion.
Even the traditionally laggard West Bengal Government seems to have got the message that it has to begin “delivering.” Accordingly, it has agreed to widen part of the long highway from Siliguri to Digha/Haldia in Midnapore, as National Highway authorities propose to convert a northern stretch of two lanes to a four-lane highway. Also, the state has cleared encroachment of a few pockets that were holding up the already delayed expansion of the Metro railway project in Kolkata. Work had been held up for long in both cases.
(The views expressed are strictly personal.)