Bhubaneswar, Jan. 1: The proposed national waterway project has moved a step forward with the Inland Waterways Authority of India, state government and two state ports agreeing to develop a 205-km stretch of river course from Kalinga Nagar in Jajpur to Dhamra and Paradip ports.

The project is aimed to widen and deepen the Brahmani river and the Mahanadi delta system to facilitate movement of 1,000-tonne cargo-capacity vessels between mineral rich north Odisha to Dhamra and Paradip ports. The project is estimated to cost Rs 700 crore.

The Inland Waterways Authority of India will widen the river course and build bridges and barrages. The state government will provide the required land. The two ports, apart from financing the project, will create logistics for shipment of goods from their respective areas. The four stakeholders will have equity participation of Rs 200 crore and the remaining Rs 500 crore will come through term loan.

Earlier, the waterways authority had prepared a detailed project for 588-km waterway project consisting of Talcher-Dhamra stretch of the Brahmani river, Geonkhali-Charbatia stretch of now-defunct British-era East Coast Canal, Charbatia-Dhamra stretch of the Matai river and Mangalagadi stretch of the Mahanadi delta system.

In 2008, the project, estimated at Rs 4,953 crore, could not take off due to paucity of funds. The Centre had also tried to explore possibility of executing the project through public-private partnership. There were talks with the Asian Development Bank and the World Bank for funding. But nothing concrete materialised.

“The project has now gained momentum with the state government and Paradip and Dhamra ports showing interest for equity participation. At last, they have understood the importance of water transport, which is cheaper and environment-friendly,” said an inland waterways official.

State’s commerce and transport secretary G. Mathi Vathanan said: “In the first phase, the 205-km stretch, identified as viable, will be developed through the joint venture.”

The decision to have a joint venture was taken at a meeting called by chief secretary Jugal Kishore Mohapatra and was attended by vice-chairperson of the inland waterways authority Jayashree Mukherjee, Paradip Port Trust chairman Sudhanshu Sekhar Mishra and Dhamra port CEO S.K. Mohapatra.

Cargo to the tune of 2.5 million metric tonnes is projected to be transported through the waterway a year. There is a huge cargo potential for the waterway as the coal and other minerals would be fed to the six steel plants at Kalinga Nagar.

The inland waterways authority has asked the Water and Power Consultancy Services to update its detailed project report for the 205-km stretch.

The earlier project was designed to handle 500-tonne vessels. But, it needed be redesigned keeping in view viable economy size vessels with at least 1,000-tonne capacity, sources said.

Once the project report is prepared, the authorities will approach the ministry of environment and forests and the Odisha State Pollution Control Board for environmental clearance, said an official.

Chairman of the Paradip Port Trust Sudhanshu Sekhar Mishra said: “We are happy that the project is coming up. We are taking steps for development of the jetties in our  port.”