The Kandla-Bhatinda Pipeline Controversy

Abstract

This case emphasizes the decision making process of infrastructure investments for the two modes of transportation of petroleum products between Kandla Port and North West India. Indian Oil Corporation made a proposal in 1981 for a new pipeline between Kandla and Bhatinda, in order to cater to the increased projected traffic of petroleum products for the North Western region. This raised a controversy between ministries of Petroleum and Railways. Railways came up with an alternate proposal of upgrading the existing meter gauge, part of which was justified any way to serve the strategic purpose of the Ministry of Defence. The contention of the two ministries led to a prolonged debate with the involvement of a number of agencies like the Planning Commission, etc. Finally the controversy was resolved when the Union Government, in a surprise move, decided that both the modes would be allowed to be constructed.