The Ministry of Shipping on December 6, 2018 gave its approval for the development of a Rs. 156 Crore Freight Village in Varanasi, which would be adjoining the Inland Waterways Terminal on River Ganga.

The Varanasi Freight Village will be developed by the Inland Waterways Authority of India (IWAI).

What is a Freight Village?

Varanasi Freight Village

  • A Freight Village is a designated area where facilities for several modes of transportation, distribution of good and other logistics can be found on a large scale in a synchronised manner.
  • Freight Villages are cargo aggregators which offer various logistic choices to a shipper or cargo owner such as choice of rail-road; rail-waterway; road-waterway.

Advantages of a Freight Village

  • It is will be serving as a cargo hub and a centre for value addition and aggregation.
  • It will help in providing support to stimulate the development of a professional logistics industry in Varanasi.
  • The main function of Freight Villages is to synergize and decongest the existing mode of transportation, besides looking after the management and utilisation of various modes of transport.
  • The coordination of various freight-related activities and delivery under one single roof would ensure ease in business.

Why is Varanasi the chosen site for building a Freight Village?

  • The World Bank conducted a pre-feasibility study upon which it discovered Varanasi as an ideal location for the freight village.
  • Varanasi, as a city, is located strategically and serves as a focal point n the logistics chain of Eastern Transport Corridor of India, where the National Waterways-1, Eastern Dedicated Freight Corridor (EDFC), National Highway-7 and National Highway-2 pass through.
  • With the commissioning of the Inland Waterways Terminal (IWT) being built under the Jal Marg Vikas Project, the volume of traffic on the inland waterway to Varanasi is expected to increase.
  • The estimated volume of traffic for Varanasi multi-modal terminal is 3.55 MMT by 2020; 3.82 MMT by 2025; 10.12 MMT by 2035.
  • Vessels with a capacity of up to 2000 DWT would be able to berth at the IWT multimodal terminal, which will possess the infrastructure facilities required to handle this expected increase in the volume of cargo traffic.

Highlights of the Varanasi Freight Village

  • The Varanasi Freight Village will be developed over a land which would be acquired in two phases – 70 acres in the first phase and 30 acres in the second phase. Therefore, the total land area becomes 100 acres and at an estimated cost of Rs. 120 crores.
  • Reportedly, a pre-investment cost of Rs 45 crores is underway, which would be incurred on the procurement of consultancy service and operation of the project management unit.
  • The Inland Waterways Authority of India (IWAI) will be owning the land of the freight village, but part of it will be leased to logistics companies and waterways-related manufacturing and trading companies for setting up their own business.
  • The freight village can potentially cater to a diverse cargo profile including containers, bulk and break-bulk cargo, liquid bulk and bagged cargo.

About Inland Waterways Authority of India (IWAI)

Inland Waterways Authority of India came into existence on December 27, 1986 by the government of India. It was created for the development and regulation of inland waterways for shipping and navigation. The IWAI undertakes projects related to development and maintenance of Inland Waterway Terminal infrastructure on National Waterways through grants received from Ministry of Shipping, Road Transport and Highways.

The IWAI has its head office in Noida, Uttar Pradesh and regional offices in Patna, Kochi, Guwahati and Kolkata.

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