Could you provide our readers with some background information on the Ministry’s main responsibilities, its most recent developments and the current situation of the transport sector?
The Ministry of Transport mainly handles the overall national policy of the transport sector in relation to its passenger transport, railways, both in the private as well as state bus sectors. Moreover, is also in charge of the cargo transportation sector in policy making as well as through the Department of Motor Traffic, which is under my Ministry. The Motor Traffic Act provides for all forms of traffic and other regulations, other than aviation and sea transport. Therefore, private motorcars, three wheelers, motorcycles and other commercial vehicles all come under the Motor Traffic Act. The Ministry is also involved in the overall policy making of inland water transport. This covers cargo as well as passenger and ferry services within certain destinations. We also have the National Transport Commission, which is the body that formulates policies in relation to transport. Our intention in the future would be to make a policy framework for cargo as well as in the field of rail transport. The National Transport Commission also carries out their own surveys, research and has teams preparing relevant studies for passenger flow in specific areas, passenger flows in specific transport segments and in the cargo sector, which involves the costing of bus fares, relevant inputs contributing to the total cost. We are presently involved for the first time, in formulating a Bus Fare Index as Sri Lanka has faced the problem of fuel hikes. This would include all the inputs in relation to the formulation of a fare. We anticipate that the end result would be that the country, the passengers as well as the owners would get to know the exact percentage of increase rather than take ad hoc decisions after price hikes. This would bring into operation an annual index calculation and would provide stability to the relevant sectors. This would enable the investors and operators to know what their investment potentials should be. The National Transport Commission has carried out a study in relation to the transportation of school children. In Sri Lanka there are approximately 4.5 million students attending school. Out of this, 45% choose the bus for travelling. The government of Sri Lanka has been providing a subsidy for school children for a lesser bus fare as well as for university students. We are trying to formulate a better service for the schools. The present problem is the traffic congestion caused by a mismanaged transport systems, resulting in time loss plus fuel loss and has been recognized by the National Transport Commissioner. This has become a high priority for the Ministry. We hope to implement the first model in the month of June for selected schools in the city of Colombo. The National Transport Commission has also done studies in relation to State Bus Services. The bus services in Sri Lanka were nationalized in 1958. Since 1979, private bus operators have had no role to play in public transport. However, since 1979, State as well as Private buses have been competing in this field. We presently have 17,000 private buses in Sri Lanka and the state has only 6,700 buses. The monopolistic state situation has been reversed. Nevertheless, the state bus services do take around 45% of the transport passengers. There have been further attempts to bring in efficiency to the management of the state bus systems. We are trying to set up the Sri Lanka Central Transport Board. This was functioning but defunct for some time. In the process of reviving it we hope to bring in new technology and new management skills in order for it to play the role of a holding company, comprised of several state companies that are operating buses. Thereby, we hope to obtain more efficiency and utilization of resources. This is what is being proposed. The private bus services have been given the opportunity of investing in new routes, which are being opened by the National Transport Commission. Their revenue as well as investments has been given assistance by the state. The state has also been offering low interest loan schemes for the private bus operators in order for private bus operator companies to be created. This would help increase their efficiency and management as well as introduce new technology if necessary.
Diesel petrol plays a major role in this sector. Certain regulations of the motor traffic act have been accommodated to register gas-operated vehicles. This is a new area as we are considering alternate forms of energy that can be used for transportation. This is a major challenge that Sri Lanka will have to face, as we have not found oil as yet. I am confident on all the surveys carried out that we should find oil within the 200-mile radius of Sri Lanka. Across India there have been many rigs that have found oil; from the southern end of Malaysia downwards, oil has been struck. We have to think in terms of how to reduce the cost of our transport systems, which depend heavily on the import of oil. This area is being canvassed even for passenger transport.
| What are the Ministry’s concrete plans so as to improve the transport services?
There are many avenues open for private investors but it is a small market and can be operated by a better management system. A lot of concessions have been given to private operators - low interest loan schemes, exemptions from many of the taxes so that the fares would be affordable for the public, while allowing revenue earning and profit margins to be obtained for the private bus operators. Sri Lanka’s train services are about 150 years old. Today, there is very clear plan to make Sri Lankan railways the key transportation service in the next 2 decades. There has been a shift to the trains in the new areas. For example the Kelani Valley train service, which was abandoned, has been revived and developed with a 30 kilometre run and has attracted many passengers. On the coastal Belt as well, the train services from Galle to Rambukwana, are attracting a fare amount of new passengers. However, this is coming as a complaint from private bus operators. Our survey shows that the increase is 17 - 18%. The demand is for fast moving comfortable trains. Therefore, new investments have been earmarked in this sector. There is also a proposal to electrify trains in stages, initially starting from the Colombo - Veyangoda lines. We have been increasing the locomotive fleet. We have got nine new locomotive machines under the French assistance program. This will bring high speed and improve our present fleet, especially to the areas of the hill country, down south and to Anuradhapura. More locomotives are also being brought from China. Telecommunication of the railways has been developed from Rambukwana to Panadura, which is an important sector. This has been done with Dutch collaboration and has advanced the speed of trains tremendously. Signalling has been improved and will continue to be implemented in stages, down south. Single lines have also been double tracked on the southern line as the traffic has increased. We have three tracks on the run from Colombo to Katunayake. Ragama is being planned with partnership for a new containerized yard. The train will bring containers from the port of Colombo directly to the container yard and will be distributed via train to the rest of the country. This is a new project that is being offered, where the Sri Lanka railways and the port authority, are offering this project for new investment, in a different form of ownership and management. The other new project is to improve the efficiency of the Katunayake airport Colombo run. Express train services, which are being planned from Katunayake airport to Colombo City like as in other major cities around the world where every major airport has a railway link to the city, e.g. London, Tokyo. There are also domestic workers who go to the Middle East totalling 1.5 million and which amount to 10% of visits annually, plus tourism from the airport to the city and back. There are other extensions, which we are planning. The southern extension from Matara to Hambantota and Katharagama which have been in the pipeline for some time and trying to find new investment for this project which will bring the train to the deep south of Sri Lanka, beyond Matara. The cargo transport is also looking to the future; the Trincomalee harbour will play a major role in cargo traffic, much more than today, and in the Bay of Bengal as well as in the southern Indian port. Therefore, the train service for cargo will have to have new development from Trincomalee to Colombo. When the Northern situation gets back to normal the railway network will have to be restored in those areas. 30% of our railway is not operated today due to the problem in the north. There will be a tremendous increase in train operations once this situation is normalized. As an industry, the train sector can also build up an industry to specialize in carriages and wagons. We think that there would be foreign collaboration in this field. These are the projected plans for the train systems. There are also urban development plans for the trains, which are being discussed presently as a result of traffic congestion, which are increasing, and we are finding it difficult to cope with. We are also in the process of re-registering in order to eliminate in the next five years, the older vehicles from the fleet. They will be tested with the latest equipment for which we have been getting consultancy and advice from European countries. We hope to upgrade our present fleet of vehicles and to reduce the unnecessary pollution caused and also reduce the waste in the use of diesel and petrol.
How do you see the contribution of the transport sector to the economic growth?
The transport sector has to play a vital role as our economy is becoming industrialized. The other factor is that Sri Lanka is giving high priority to exports. Export oriented industries have to be moved, and goods as well as the production of raw materials have to be transported in a fast, safe way to their respective destinations. The economy will depend heavily on cargo transport. Passenger transport too is vital, as without passengers the establishment cannot be run. More capital investment in the transport sector is crucial.
What would be your final message to our readers?
Sri Lanka has a very open policy for investment, and a very liberal policy for investors. Sri Lanka also has a trade agreement with the Indian sub continent, which is the second largest growing economy in Asia today. Therefore, the opportunities in transport, passenger as well as cargo for new investment, new technology, new management, new management skills, is what Sri Lanka is awaiting. There are a lot of openings for investors in the field of transport. It is only now that we are opening up for new developments in the area of transport.
NOTE: World Investment News Ltd cannot be made responsible for the content of unedited transcriptions.
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