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Although acoustic waves are the most versatile and widely used physical layer technology for underwater wireless communication networks (UWCNs), they are adversely affected by ambient noise, multipath propagation, and fading. The large propagation delays, low bandwidth, and high bit error rates of the underwater acoustic channel hinder communication as well. These operational limits call for complementary technologies or communication alternatives when the acoustic channel is severely degraded. Magnetic induction (MI) is a promising technique for UWCNs that is not affected by large propagation delays, multipath propagation, and fading. In this paper, the MI communication channel has been modeled. Its propagation characteristics have been compared to the electromagnetic and acoustic communication systems through theoretical analysis and numerical evaluations. The results prove the feasibility of MI communication in underwater environments. The MI waveguide technique is developed to reduce path loss. The communication range between source and destination is considerably extended to hundreds of meters in fresh water due to its superior bit error rate performance.