KATHMANDU: The Investment Board of Nepal (IBN) has decided to expedite the process of awarding the West Seti Hydropower Project to an Indian company.
The Investment Board’s office has received a mandate to discuss investment modalities with NHPC in the project. Earlier, IBN has decided to break the agreement with the Chinese company Three Gorges.
Prime Minister Sher Bahadur Deuba had disclosed this issue at an election rally held at the Dadeldhura. He had said that talks were underway with India for the construction of 750 MW West Seti Hydropower Project. He had clarified that an Indian company should be brought as Nepal alone could not build West Seti.
An official of the Board of Investment said that the decision was taken as the SMECK and the Chinese company Three Gorges could not build the project. In such condition, the Indian government company was planning to build the project.
“The slogan of nationalism is on one side, but we have seen that Indian government companies can build big projects in Nepal quickly. India’s private company GMR has not been able to build even Upper Karnali,” he said.
When Indian Prime Minister Narendra Modi visited Lumbini, preparations were made to sign the agreement as soon as possible. However, the investment agreement could not be signed as the modality was not finalized.
A committee was formed under the coordination of Vice Chairman of the National Planning Commission Bishwanath Poudel to finalize the construction modality of the project. The committee had suggested that West Seti and ‘SR-6’ could be built in the same package so that foreign investors would be interested.
The Chinese company Three Gorges had refused to build the West Seti even after reducing the capacity. The board had proposed to reduce the capacity of the project from 750 MW to 620 MW and sign a power purchase agreement (PPA) in US dollars.
However, the Three Gorges was uninterested from West Seti due to the geological location, height and rehabilitation of the affected area. They said the project was not financially feasible due to a number of issues, including resettlement.
Twenty-four years ago, the Australian company SMECK also took over the construction of West Seti. However, the government revoked the license after the work did not move forward even after renewing the license 10 times. In 2012, the project was handed over to Three Gorges Company.
According to a study by the Japan International Cooperation Agency (JICA), the project could generate up to 652 MW. For this, a 207 meter high dam should be built.
The board also claims that the West Seti and SR6 projects can be built by the same developer at 450 MW and West Seti at 750 MW by managing water shut-off, power generation and discharge time.
