New Delhi: Jogighopa, a small town in Assam, is set to become India’s gateway to South-East Asia as well as the rest of the North-East with the road ministry gearing up to develop a multimodal logistics park (MMLP) there with road, rail, waterways and air transport facilities.

The development includes railway sidings, container terminals, warehousing, non-cargo processing, a truck terminal, common facilities, support infrastructure and equipment.

A special purpose vehicle, backed by the Asian Development Bank (ADB), will be created to execute the project, which will be executed in two phases—Phase I of around Rs155.46 crore and Rs115.88 crore for Phase II.

“Recent developments, like the announcement of the Northeast Economic Corridor under the Bharatmala programme of the road ministry and the signing of the MoU (memorandum of understanding) between India and Bangladesh for developing the Dalu-Tura-Goalpara-Gelephu multimodal trade route strengthen Jogighopa’s case for MMLP," a senior government official said on condition of anonymity.

He added that under the project, all four types of transportation—road, rail, air and waterways—will be available.

The project is one of the key focus areas of road minister Nitin Gadkari. The road ministry has shortlisted 35 MMLPs across India, of which four are being executed in collaboration with ADB.

The current transit corridors from mainland India to the North-East region pass through an area known as the “Chicken’s Neck"—a narrow tract of land in India between the borders with Bangladesh, Nepal and Bhutan. Since it is close to these borders and cannot be expanded, the North-East region requires an alternative route for providing connectivity to the rest of India—a route with adequate expansion potential. The Indo-Bangladesh road route, along with the National Waterways-2 , provides such an option.

According to the draft report on the Jogighopa MMLP accessed by Mint, freight demand in terms of volume is projected to grow at a compound annual growth rate (CAGR) of 5.93% from 11.96 million metric tonnes (MMT) in FY17 to 33.74MMT in FY35. The total container market is projected to grow from 4,808 TEUs (twenty-food equivalent units) in FY17 to 7,925 TEUs in FY35—a CAGR of 2.82%.

The move comes at a time when India’s neighbours are gearing up for trade. For example, Bangladesh’s development of the Khulna-Dhaka-Sylhet Economic Corridor and the Banglabandha-Dhaka-Chittagong-Cox’s Bazar Economic Corridor—to promote industrial development in the region. These initiatives are expected to drive freight movement in the region and facilitate trade between India and Bangladesh, and between Bangladesh and Bhutan through India.

Since last year the government has started prioritizing the logistics sector by granting it infrastructure status and anticipates major investments in it. The Logistic Performance Index published by the World Bank shows India jumping 19 spots in the global ranking from 54 in 2014 to 35 in 2016.

Stakeholders welcomed the government plans.

“North-East is one of the regions which has played a pivotal role in terms of logistics connectivity with the international and national corridors of India. We believe Asean’s (Association of Southeast Asian Nations) strong bond with the North-East region will act as a mascot for the entire region and for the rest of the businesses in India," said Chander Agarwal, managing director of logistic company TCI Express.

The decision is significant because of the sustained “Act East" policy of the National Democratic Alliance (NDA), along with the development message of the ruling Bharatiya Janata Party which has managed to form governments along with alliance partners in Assam, Arunachal Pradesh, Manipur and Sikkim. The party is hoping to play a decisive role in the upcoming assembly elections in Tripura and Meghalaya. The political importance of the North-East is also significant because the eight states together have 25 Lok Sabha seats.

The BJP is also making inroads in Tripura which has been led by Left Front governments for the last 25 years. The party is contesting assembly elections, scheduled to be held on 18 February, as the direct challenger to the Left Front in the state.

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