Deadline for fin closure of Upper Karnali and Arun III extended

Kathmandu, Jan. 8:

Investment Board of Nepal (IBN) has decided to extend the deadline for the financial closure of Upper Karnali and Arun Third Hydropower Projects up to 18^th September and 30^th September, 2017 respectively.

A meeting of the Board chaired by Prime Minister Pushpa Kamal Dahal Prachanda, who is also the chairman of the IBN, on Sunday made a decision to this effect and asked both the companies to submit the action plan for the financial closure within the extended date.

The meeting has also directed the government, Ministry of Forest and Soil Conservation and Ministry of Land Reform to provide the land required for Upper Karnali and Arun III projects within two months.

Upper Karnali, 900 megawatt project undertaken by the Indian developer GMR, had requested the government to extend the deadline to complete the financial closure by one year.

It had cited earthquakes and Terai agitation as the causes of disruption.

According to the Project Development Agreement (PDA) signed between the GMR and IBN in September 2014, the developer had to complete the financial closure by September last year.

 Similarly, Arun III, another 900 MW project being developed by the SJVN India – Indian state-owned company, had to complete its financial closure on 24^th November, 2016.

It also had sought one year extension for the financial closure.

According to a press statement issued by under-secretary of the Board, Khagendra Prasad Rijal, the meeting had decided to finalise the modality for the development, construction and operation of the Tamakoshi III Hydropower Project.

Ministry of Energy and IBN will collaborate in finalizing the modality.

"The meeting of the board has decided to form a committee, led by a member of the National Planning Commission and having representatives of the IBN, Ministry of Physical Planning and Transport and Department of Railways, to study whether the metro rail in the Kathmandu Valley could be developed as per the Public-Private-Partnership modality and Viability Gap Funding (VGF)," said Rijal.

It decided to waive off 0.2 per cent of the total cost of the project, which every project should pay to the government before the Project Agreement Dialogue, in terms of Kathmandu Valley Solid Waste Management Project.

PM Dahal directed the concerned government agencies to remain vigilant to not to let any development be delayed.

"You should be very careful not to let any project being delayed due to government inefficiency to fulfill its liabilities," he said.

Minister for Finance Krishna Bahadur Mahara, Minister for Energy Janardan Sharma, Minister for Federal Affairs and Local Development Hit Raj Pandey, Minister for Industry Nabinra Raj Joshi, Minister for Forest and Soil Conservation Shankar Bhandari, vice president of the National Planning Commission Min Bahadur Shrestha, chief secretary Dr. Som Lal Subedi, governor of the Nepal Rastra Bank Dr. Chiranjibi Nepal and other high government officials were present in the meeting.