Fuel cess to be utilised for national waterways

The Union Cabinet on Wednesday approved decision to use portion of its fuel cess for funding the development of national waterways.

“Cabinet has approved allocation of 2.5% of the Central Road Fund for development and maintenance of National Waterways,” an official statement said. The cess is collected for development and maintenance of national highways, railway over bridges and state roads at present.

The move will help government allocate Rs 2,000 annually for funding national waterways development.

“The approval is a big step for promotion of Inland Water Transport as cost effective, logistically efficient and environment friendly sector,” Union Road Transport, Highways and Shipping Minister Nitin Gadkari said here.

The central government will amend the Central Road Fund Act, 2000 to give effect to its proposal. Central Road Fund (CRF) is a non-lapsable fund created under the Central Road Fund Act 2000 out of a cess imposed on petrol and high-speed diesel. The government collects around Rs 80,000 every year by leving Rs 2 per litre on petrol and diesel as cess, the Shipping Ministry said.

“The Cabinet decision to allocate resources from the CRF would provide a sustained source of funding for National Waterways,” the Shipping Ministry said, which had last year proposed seeking allocation of 5% of the Central Road Fund for development of Inland Waterways.

Under the National Waterways Act 2016, 111 inland waterways across 24 states have been declared as national waterways. At present, five national waterways are operational and the rest of them will “now be backed by funding source,” the Ministry said.