Indo-Myanmar project delayed till 2015

July 1, 2013: The Kaladan Multi Modal Project that will boost ties between India and Myanmar and was supposed to be completed in June has now been delayed till 2015.

"At the beginning of the project in September 2010, the entire construction was estimated to be completed by June 2013. But the project has faced several hurdles and therefore there has been a delayed. It is now expected to be completed by 2015," said a highly placed official in the Indo-Myanmar Chamber of Commerce and Industries (IMCCI) who requested anonymity.


According to various organisations associated with the project, the primary reasons for the delay are labour strikes, insufficient funds available for the project and lastly the monsoon in the country.


"Labour discrimination is embedded in the Kaladan Project's 2008 Framework Agreement. The difference in wages of Indian and Myanmar workers has resulted in unrest among local labourers who feel as if they are being treated as second-class citizens in their own state," said Twan Zaw, executive director, Arakan Rivers Network, a human rights group in Myanmar.


The primary reasons for the delay are labour strikes, insufficient funds available for the project and lastly the monsoon in the country.


He further added that at the Sittwe Port site, local labourers face discrimination in their working conditions as well.


"In August last year, approximately 40 Essar workers from the Sittwe Port construction site staged a strike in front of the local Essar office to bring attention to their grievances about not being treated equally to Indian workers on the site. Burma army soldiers brandishing machine guns approached the crowd and dispersed them. The company, till date, has not responded to any of the demands", alleged Zaw. An email sent to the company on the issue, did not elicit any response till the time the story went to press.


Another reason for the delay in the project is the finance available for it. The project is being financed by the Indian government. However, there is rising concern about it being over-budget. "The Ministry of External Affairs (MEA) claimed that the project is over-budget due to the lengthening of the Phase 3 highway component, but that Phase 1 and 2 are on-budget," said Zaw.


It is important to note that in the Standing Committee of External Affairs' 14th Report on the MEA's Demands for Grants (2012-2013), it had requested for Rs 448 cr for the project, however, only Rs 220 cr was subsequently approved. The total cost of the project is a little over Rs 1,100 cr.


The monsoons in Myanmar too has been a constant obstacle. According to Zaw, the construction work will be stopped between April and November 2013 due to heavy rains.


Meanwhile, public sector banks Punjab National Bank (PNB) and the Central Bank of India will open their branches in Rangoon Myanmar by the end of the year.


"Indian banks are interested in setting up the banking infrastructure in the country. United Bank of India already has a representative there and requests from more banks are coming in," said a senior official in IMCCI.


The Sunday Guardian