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5 Infrastructure and Industries

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Infrastructure and Industries

5.1. Infrastructure is Critical

  1. The disruption of partition not only increased transport costs but it also dislocated the traditional markets of the North-East. It also increased transactions cost and reduced access to finance. The transport disruption was all around. The road distance to rest of India increased, connectivity through waterways became poor, and loss of access to the port of Chittagong meant international markets also became less accessible. Coupled with these, poor power sector development and difficulties of getting financial credit have also contributed to poor development of industries in Assam. We look at the status of infrastructure development in Assam.

  2. At various stages the Central government has recognized the need to pay special attention to infrastructure development in the North-East. A number of initiatives were taken in the 1990s. A committee was constituted in February 1990 under the chairmanship of L C Jain, Member of the Planning Commission. A high level commission was set up under the chairmanship of S P Shukla in 1997 to tackle the problem of backlog in basic minimum services and infrastructure needs of the North-East. The recommendations of these committees were reflected in programmes announced by various Prime Ministers. Thus, an economic package of Rs 6100 crore for specific projects in NE states as announced in October 1996 by the then Prime Minister H.D.Deve Gowda included fourth rail-cum-road bridge over the Brahmaputra at Bogibeel, upgradation of Guwahati airports and a few industrial growth centres in addition to some road projects, drinking water supply schemes and health care programmes. He also introduced the North-East sub-plans in all Central Ministries for which 10 per cent of their budgets would be earmarked.

  1. Mr I K Gujaral who followed Mr Deve Gowda as Prime Minister also assured the implementation of the package in toto. In January 2000, Mr Atal Behari Vajpayee further announced Rs 10,271.66 crore package for the region1.

What has been the impact of these programmes? What is the state of infrastructure in Assam?

5.2. Roads

  1. The road network in Assam is extensive in terms of road density, that is, road length per thousand sq km, of all roads. However, in terms of density of surfaced road Assam is way behind India and the gap is increasing (See Table 5.1). However, the density of national highways is higher in Assam and more have been added in recent years. This would imply that the state government has invested on extending the road network rather than on improving the quality of roads. Recent improvement and initiation of new projects will add even more national highways (See Table 5.1). Yet all weather roads connecting villages remain inadequate. With emphasis on new roads, inadequate attention is paid to maintenance of existing roads. Many roads are in poor state and all weather connectivity for many villages is limited. With poor connectivity farmers get lower price for their produce while urban consumers pay a higher price.

Table 5.1: Roads in Assam and India


Road Length ('000 Km)

Road Density (Km per '000 Sq Km)


Surfaced Road

Unsurfaced Road


Surfaced Road

Unsurfaced Road


 All India
































































Source: CMIE: Infrastructure, Various Issues

  1. For public transport, the Assam State Road Transport Corporation (ASRTC) was set up. Like other such public corporations in the country ASRTC is also overstaffed and financially sick. ASRTC has annual deficit of Rs 22.55 crore and accumulated liability of Rs 80 crore including 12 months of employee salaries of Rs 28 crore. The bus staff ratio is 1:40. The scheme formulated to restore it to health is yet to be implemented. It is thus unable to meet the growth needs of the people of Assam with quality service.

  2. The progress or lack of it, in implementing the recommendation of different committees is shown in Table 5.2. We do see progress. The momentum generated should be maintained and villages should be connected with all weather roads.

Table 5.2: Roads: Recommendations of Different Committees

Recommended by


Status in April 2001

Jain Committee (April 1990)

  1. Improve efficiency and economic viability of Assam State Road Transport Corporation (ASRTC).

No progress

S P Shukla Commission (March 1997)

  1. Develop as National Highways

    1. Daboka-Silchar highway (290 km)

    2. Kohima-Amguri between Nagaland and Assam (241 km)

No objection for handing over land to center given by state on 9.3.99.

Estimate was not sanctioned by GOI till 14.3.01

Prime Minister Vajpayee’s announcement of January 22, 2000

  1. Road Projects

    1. Baithalangsu-Raha (48 km)

    2. Naharkatia-Khonsa (57 km)

    3. Panchgram-Hailakhandi (58 km)

    4. Megherita-Changland (43 km)

    5. Zamuang-Durlavcherra (79 km)

    6. Jotte-Balijan (58 km)

    7. Fatikroy-Kailashwar (98 km)

Work initiated and is in various stages of completion.

  1. New National Highways totalling 1962 km in the NE of which 433 km is in Assam.

Declared as national Highways and consultancy quotations invited.

Source: Compiled by author from committee reports and data supplied by Government of Assam.

5.3. Railways

  1. Similarly, the development of railways (see Table 5.3) took a long time to reach a reasonable level. At the time of Independence, the North-East was connected to the rest of the country by a metre gauge line laid by the British mainly to transport tea and other raw materials from Assam to Kolkata. This remained so till 1966. Transport by railways does not provide the timely delivery and assurance that trucking provides. Its relative cost advantage is often offset by cost of time and pilferage. When a trans-shipment is required from metre gauge to broad gauge (BG), both these costs increase. Conversion to broad gauge was begun in 1962 after the Chinese aggression but reached Guwahati 22 years later in 1984. It took 10 more years to reach Lumding. Things have changed in recent years as Dibrugarh is connected by BG, the Jogighopa bridge across Brahmaputra is commissioned in 1998-99 and further BG lines are under construction. At last the NE can hope to have regional rail connectivity. The recommendations of the Jain Committee and the Shukla Commission (see Table 5.4) have had impact. However, there is congestion on the Siliguri-Guwahati sections. It should be examined how to relieve it, expeditiously and economically either through double tracking or through building appropriate bypass loops, to increase line capacity and reduce transit time.

Table 5.3: Development of Railways in Assam


Route Length


All India





(Km/000 Sq Km)

















Source: CMIE: Infrastructure, Various Issues
Table 5.4: Railways: Recommendations of Different Committees

Recommended by


Status in April 2001

LC Jain Committee

(April 1990)

1. Speed up and complete

(a) Rail-cum-Road Bridge at Jogighopa

1a. Inaugurated in April 1998

(b) BG line from Jogighopa to Guwahati which were taken up in 1983-84

1b. Completed Feb. 2001.

2. BG line from Guwahati to Dibrugarh.

2. Most of it completed rest expected by end 2001.

3. New BG line from Jhalukbari to Panikheti

3. No proposal for survey work

4. Extension of BG track from Lanka to Silcher

4. Conversion work sanctioned in 1996-97

5. A rail-cum-road bridge at Bogibil near Dibrugarh

5. Final location survey completed. Final clearance is awaited.

S P Shukla Commission (March 1997)

6. Expeditious completion of Bogibeel bridge

6. Final clearance awaited

7. (a) Diphu-Karang and (b) Bairabi-Saireng lines be taken up in 9th plan.

7a. Survey completed by Mizoram has indicated preference for a new alignment.

7b. Survey work awarded for a proposed line but facing local opposition

8. Overnight trains between Dimapur and Guwahati.

9. Linkage with Bangladesh

9. Survey on Indian side completed, awaiting Bangladesh report.

10. Linkage with Myanmar.

10. No proposal.

Jain Committee

11. Establish a railway training institute.

Source: Compiled by author from Committee reports and data supplied by Government of Assam.

  1. The railways have not been able to compete profitably with the trucks as the latter are more reliable and prompt. Time is money for the transporters. A considerable difficulty linked to pilferage also takes away the price advantage enjoyed by the railways.

  2. In a way, comparing road density or rail density of Assam and the North-East with all India figures is misleading. The mighty Brahmaputra runs through Assam dividing it into two parts. Bridges across Brahmaputra are extremely important for connectivity. And there are only three bridges today.

5.4. Inland Water Transport

  1. The inland water transport network was disturbed by partition and further disrupted by the earthquake of 1950. A special chapter deals with the possibilities of reviving inland water transport. The river Brahmaputra was declared as a National Waterway No 2 by an Act of the Parliament in the year 1988. However, this declaration remains mostly on paper as very little significant and concrete work has been done by the Inland Waterways Authority of India (IWAI) for translating the intents into reality. The channel from Dhubri to Sadiya is 890 km long. The channel is functional and stable almost throughout the year except for two lean months in upper Assam. The main channel has depth of 10 to 40 metres and with width of 500 metres to 1.5 km. Even though we have come to the twenty-first century the entire stretch of the National Waterways No 2 remains without voyage, bundling and night navigational facilities. Therefore, the efficiency of the waterways has been reduced to half. In addition, there is no mechanized cargo-handling facility available in any of the ports, including Pandu port. This reduced operational efficiency and inaction on the part of the IWAI has added to the operation cost of water transport, making it almost unviable. A round trip from Kolkata to Pandu and back takes almost 50 days. It could have been very easily completed in 25 days with night navigational facilities and mechanized cargo-handling systems. In addition, the Brahmaputra has hardly any terminal with proper infrastructural facilities. The Inland Water Transport (IWT) directorate of government of Assam has commercial fleet with a total tonnage of 600 MT. Most of these vessels are now used for ferrying people at various points in the absence of demand for their utilization for carrying cargo.

  2. The over-dimensional equipment for Numaligarh refinery which the railways could not have carried were transported by IWT Department of Government of Assam with remarkable efficiency and promptness. It shows the potential of river transport. In a later chapter, we recommend constitution of Brahmaputra Development Authority. This Authority should be funded by the Government of India as the State Government does not have funds to cater to the needs. The Inland Water Transport Directorate has a strong infrastructure with good cargo carrying facilities as well as trained manpower. They have adequate training facilities also. Over the years, they have gained experience in plying vessels over the Brahmaputra in various seasons in the year. Therefore, the IWT Directorate should be able to expand its activities in the commercial area and in carrying cargo to and from the State via Waterway No 2. Since it is a national waterway, the Government of India should make the needed investment to provide the basic terminal or landing facilities all along the Brahmaputra. The cargo handling facilities have to be put in proper place, warehouses set up at proper locations, night navigation introduced, channel marking done and dredging operations carried out, especially, during the lean season.

  3. With proper investment the Brahmaputra could be converted from a river of floods to a river of prosperity.

5.5. Civil Aviation

  1. Air connectivity is vital for a modern economy. To develop tourism, it is a must. There were many World War II airstrips in the North-East which have been allowed to degrade. Under the package announced by the Prime Minister on October 27, 1996 at Guwahati a number of improvements have taken place. Guwahati’s Gopinath Bordoloi airport has been upgraded to international standards. International flight traffic needs to be developed now. There is, however, some progress as new airports are being built in the North-East and some old ones are being improved. Also central subsidy of 75 per cent is offered for helicopter services on some routes.

  2. Under the package announced by Prime Minister Vajpayee at Shillong on January 22, 2000, fuel price and tax concession are offered to encourage internal air services within the North-East. Thus a significant improvement is likely. Still the recommendation of Shukla Commission to make Guwahati a regional hub for Indian Airlines to ensure more timely regular flights to Kolkata is important. It should be possible to go to Kolkata and return the same evening. A long-term plan for air-connectivity of the North-East needs to be evolved.

5.6. Power

  1. Electricity consumption per capita in Assam is one of the lowest in the country. Tables 5.5 and 5.6 show the growth of electricity supply and consumption in Assam. The per capita electricity supplied is a mere 116 kwhr/person/year. This is only one fourth of the all India per capita generation of 479 kwhr and one hundredth of per capita consumption in the United States which exceeds 12000 kwhr. The gap is large and is so in spite of large resources in Assam and the North-East. The abysmally low per capita consumption of electricity reflects both poor quality of life and low level of economic activities.

Table 5.5: Power Capacity and Electricity Supply


Generation Capacity



Total supply




















Source: CMIE: Infrastructure reports, Various Issues

Table 5.6: Electricity per person per year (Kwhr)

















Source: Statistical Handbook Assam 1999; Directorate of Economics and Statistics, Government of Assam, Guwahati

  1. The power scenario is uncertain. Today, Assam State Electricity Board’s (ASEB) installed capacity is about 575 MW and with the state share of about 350 Mw in central generating stations of North-East region, the total capacity works out to about 925 MW. With the commissioning of 405 MW Ranganadi Hydro Electric Power Project in the near future and its share of about 105 MW in this, Assam’s capacity is expected to touch about 1050 MW. Assam’s unrestricted peak demand of about 650-700 MW should logically give zero energy and peaking shortage. However, unless pilferage is arrested and the liquidity, solvency and escrow-ability of ASEB improves to buy power from UEEPCO, NTPC, MSEB, etc. and improvements are made in the very poor quality of T&D system, inadequate transformation capacity, insufficient capacitor banks and high density of low tension (LT) lines vis-a-vis high tension (HT) lines it may not be possible to supply quality power at competitive rates to the consumers. If all the projects that were under implementation in March 1996 (see Table 5.7) were to be completed, the NE would have a total installed generating capacity of 3396 MW, enough to meet its demand for some years.

Table 5.7: Project Under Implementation in 1996


Raw Material

Cost (Rs cr.)

Capacity (MW)



Ranganadi (Aru)




Neepco* (Central Govt.)

Under Implementation

Kharsang (Aru)




Intercorp ind. (pvt., foreign)

Under Implementation

Kemeng (Aru)




Intercorp ind. (pvt., foreign)

Under Implementation

Kathalguri (Ass)




Neepco (Central Govt.)

Under Implementation

Kopili (Ass)




Neepco (Central Govt.)

Under Implementation

Adamtilla (Ass)




DLF Power Co. (Pvt. Ind)

Under Implementation

Karbi Langpi (Ass)




ASEB+Subhash Projects

Under Implementation

Loktak (Man)




NHPC! (State Govt.)

Under Implementation

Doyang (Nag)




Neepco (Central Govt.)

Under Implementation

Agartala (Tri)




Neepco (State Govt.)

Under Implementation

* North Eastern Electric Power Corporation; National Hydro-electric Power Corporation.

Source: Sachdeva (2000), p.221.

  1. Assam’s power sector is riddled with a hydel thermal imbalance as 100 per cent of the state’s power generation capacity is thermal; plant load factor (PLF) is 18 per cent (as the 60MW Chandrapur Thermal Power Station has been closed down due to high price of fuels; the 240 MW Bongaigaon Thermal Power Station hardly generates due to poor coal linkage and abinito structural problems in turbo-generators and the Lakowa TPS suffers from inadequate quantity and pressure of gas. This is further compounded by the steep load curve of Assam where the peaking load is twice the non-peaking load due to high domestic demand; T&D loss is a staggering 50 per cent; peaking shortage is 12.5 per cent; energy shortage is 4.5 per cent and the gap between the average cost of supply and the average tariff is a figure of Rs 4.00 per unit.

  2. With the assistance of a loan of Rs125 crore from Power Finance Corporation (PFC), Delhi, ASEB is committed to complete the long languishing run of the river (ROR) 100 MW Karbi Longpi Hydro Electric Power Project. The ASEB also proposes to pose the 38 MW Waste Heat Power Project at Lakowa to JBIC, ADB and the Planning Commission under the non-lapsable Central Pool Resources. ASEB had floated global tenders for implementation of the 30 MW x 3 Amguri Gas Based Power Project and 60 MW x 2 Borgolai Coal Fired Thermal Power Project through the Independent Power Producer (IPP) route. While no bid was offered for the Borgolai Project, one bid was received for the Amguri Project that is being processed by ASEB. The 20 MW Dhansiri HEP is stuck up because the concomitant irrigation project has not been completed. The 150 MW Lower Kopili HEP was to be handed over to NEEPCO for implementation but could not be done due to some issues raised by the North Cachar and Karbi Anglong District Councils which could not be resolved.

  3. One may note that many of the projects under implementation are hydel projects. Our understanding of the complexity of implementing large hydro-electric projects has evolved significantly. We have a much better appreciation of environmental consequences and the difficulties of satisfactorily rehabilitating project-affected people. Many hydel projects were conceived decades ago and they need to be looked at again to explore alternative designs to maximize net social gain. Projects that are so conceived that are sensitive to these needs and can be implemented in small stages are likely to be more desirable for the region. Apart from pressing for more funds for these projects a fresh look at projects in the pipeline should be taken. The NE has a phenomenal hydel potential, so in the long run NE including Assam, should not be short of power. The problem has been poor implementation of projects. Thus the recommendations of S P Shukla commission made in March 1997 for the power sector contain almost all the ones made by L C Jain Committee seven years earlier in April 1990 (See Table 5.8). The work on these projects proceeds at a slow pace due to lack of funds. Power sector reforms have become critical to improve the financial position of ASEB.

Table 5.8: Power Sector: Recommendations of L C Jain Committee (April 1990) and S P Shukla Commission (March 1997)

Jain Committee

S P Shukla Commission




About to begin



  • Complete Karbi-Langpi hydel project (100 MW)

Work started in Jan. 1999



  • Complete Dhansiri hydel project (19.5 MW)

Still going on


  • Upper Karbi Langpi Project expedited (2 x 50 MW)

Preliminary work in 2000-2001


  • New project Lower Kopily hydel (150 MW)

  • Initiate Borgoloi coal thermal (120 MW)

Clearance for coal availability obtained


  • A gas based project at Amguri subject to availability of gas (275 MW)

Gas available only by 2002.


  • Namrup thermal (gas based) extension (90 MW)

Expenditure proposed


  • Lakwa Gas thermal (22 MW)

Expenditure proposed


  • Strengthen Transmission Network (Rs 628 crores – 9th plan requirement)

Expenditure proposed
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