Kathmandu, Feb.
6
Arun III
Hydropower Project has fulfilled the conditions of the financing agreement for
the development of the project.
It signed a
Memorandum of Understanding (MoU) for financial closure with the Everest Bank
and Nabil Bank and five Indian banks on Thursday. The banks have pledged an investment
of Rs. 100 billion in the project.
Nepali banks
will make about Rs. 15.36 billion investment in the project, said Arun Dhimal,
Chief Executive Officer of the project.
State Bank of
India, Punjab National Bank, Union Bank, Canara Bank and Exim Bank of India
will invest about Rs. 85 billion in the project while Rs. 25 billion will be
mobilised by the Sutlej Jal Vidyut Nigam (SJVN), a company owned by the Indian
government, as the equity investment.
Nepal Rastra
Bank and Investment Board of Nepal had given their permission for the agreement
for the financial closure.
The 900-megawatt
project is being developed by the SJVN in Sankhuwasabha district.
The dam site of the project
is at Numko Fyaksinda and power house at Pukhuwa of Makalu Rural Municipality
of Sankhuwasabha district.
The project has
achieved about 25 per cent progress even before the financial closure and the entire
work is projected to be complete within next three years. If completed within
the stipulated time, the project would be the largest hydroelectricity project
executed in the country.
Estimated cost
of the project is Rs. 104 billion while another Rs. 11 billion will be invested
in transmission line construction to supply the electricity from project.
Earlier, the
company had said that financial closure of the
project would be completed by September 2018. It has got multiple extension of
deadline for the same.
Late prime minister of
Nepal Sushil Koirala and Indian Prime Minister Narendra Modi had signed an
agreement to develop the project in 2014.
According to the Project
Development Agreement (PDA) signed in 2014 between the Investment Board of
Nepal (IBN) and SJVN, the latter should develop the transmission line. However,
the Nepal Electricity Authority (NEA) proposed that it would construct the
transmission line for the project and the developer should bear the cost of
it.
Prime Minister KP Sharma
Oli and his Indian counterpart Narendra Modi had jointly laid the foundation
stone of the project in Sankhusabha district by pressing a switch from
Kathmandu during Modi’s Nepal visit in May 2018.
Nepal will get 21.9 per
cent, or 197 mw, energy and 29 per cent equity in the project free of cost. The
government had distributed Rs. 1.19 billion compensation for land acquisition
in the affected areas at Num, Pathibhara and Yaphu in Makalu and Diding and
Pukhuwa in Chichila Rural Municipality.
Published in The Rising Nepal daily on 7 February 2020.
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