India’s Inland Waterways Authority (IWAI), under the Ministry of Ports, Shipping and Waterways, has marked a historic milestone by reaching 145.5 million metric tonnes (MMT) of cargo movement in FY25, reflecting a remarkable Compounded Annual Growth Rate (CAGR) of 20.86% from 18.1 MMT in FY14. This achievement signals significant progress in India’s maritime and inland water transport sector, highlighting the growing importance of National Waterways (NWs) for cargo movement across the country.

This growth includes a Year-on-Year (YoY) increase of 9.34% compared to FY24, further underlining the sector's expanding capacity and potential. A significant portion of the cargo moved was attributed to key commodities like coal, iron ore, iron ore fines, sand, and fly ash, which collectively accounted for more than 68% of the total cargo volume. Alongside this, passenger traffic also surged, reaching 1.61 crore in FY24, showing that Inland Water Transport (IWT) is gaining momentum for both goods and passenger transport.

Government Investments and Infrastructure Development

A major factor driving this growth is the substantial investment of Rs. 6,434 crore (US$ 753.83 million) made by the government since 2014. These funds have been used to enhance the infrastructure of National Waterways, increasing the operational length from 2,716 km to 4,894 km by FY24. This expansion has been complemented by the construction of key facilities such as Multi-Modal Terminals (MMTs), Inter-Modal Terminals (IMTs), community jetties, and the development of digital platforms such as the Least Available Depth Information System (LADIS) and River Information System (RIS), which aim to improve efficiency and safety in inland waterways operations.

In addition to expanding the length of operational waterways, the number of National Waterways (NWs) has increased from 24 to 29, aligning with the government’s broader push toward multimodal connectivity. This strategy is aimed at improving the efficiency of India’s logistics network, facilitating smoother transportation of goods across land, water, and rail networks.

Incentives for Inland Water Transport

To further encourage the shift towards Inland Water Transport (IWT), the government introduced the “Jalvahak” Cargo Promotion Scheme on December 15, 2024. This scheme offers 35% reimbursement on operational costs, providing a significant incentive for companies to move their cargo via inland waterways rather than relying on road or rail transport. In addition, the scheme supports the introduction of scheduled cargo services on key National Waterways routes, increasing the regularity and reliability of IWT services.

Further enhancing the attractiveness of IWT, the Union Budget 2025-26 extended the tonnage tax regime to inland vessels under the Indian Vessels Act 2021, reducing operational costs and encouraging more private sector investments in inland water transport.

The Future of Inland Waterways and National Objectives

Looking ahead, India is targeting a 5% modal share for Inland Water Transport (IWT) and aims to achieve over 200 MMT of traffic by 2030. This ambitious goal is part of the Maritime India Vision 2030 and Maritime Amrit Kaal Vision 2047, which are long-term frameworks aimed at transforming India into a global maritime hub. The focus on IWT is essential for reducing logistics costs, improving environmental sustainability, and easing congestion in India’s overburdened road and rail transport systems.

To support this growth, the government is developing freight villages and logistics parks equipped with the necessary infrastructure for cargo aggregation. These facilities are being developed with the support of Indian Port Rail and Ropeway Corporation Ltd. and National Highways Logistics Management Ltd., further solidifying India’s push towards an integrated and efficient logistics ecosystem.

Regulatory Support for Private Investment

In line with India’s private investment-friendly approach, a regulatory framework is being implemented to streamline the integration of key terminals under Shyama Prasad Mookerjee Port, ensuring better management and connectivity across the National Waterways network. This will create a more structured environment for private investors, making it easier for them to contribute to the expansion and modernization of India’s inland water transport infrastructure.

Key Takeaways

• India’s Inland Waterways Authority has recorded 145.5 MMT cargo movement in FY25, showcasing a remarkable growth in the sector.

• The Jalvahak Cargo Promotion Scheme and tonnage tax regime are key government measures to boost the Inland Water Transport sector.

• India is targeting 5% modal share for IWT and over 200 MMT traffic by 2030, as part of its broader maritime vision.

In conclusion, the ongoing investments in infrastructure development and the launch of innovative schemes are set to propel the Inland Water Transport (IWT) sector to new heights. As India strives to achieve its 2030 and 2047 maritime goals, the increased emphasis on multimodal connectivity and private sector participation will be critical to ensuring long-term growth and sustainability in the country’s inland waterways.

The Upcoming IPOs in this week and coming weeks are Ather Energy, Iware Supplychain Services, Arunaya Organics.

The Current active IPO are Tankup Engineers.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.