Indian to develop two hydropower plants in Nepal as China abandons projects

26 Aug 2022

India will now develop two hydropower projects in Nepal, namely West Seti Hydropower Project and the Seti River Hydropower Project, nearly 4 years after China withdrew from these. The formal agreement was signed in Kathmandu this week, according to a report by Economic Times (ET). The total cost of these projects is expected to be around $2.4 billion. Nepal was left in a fix after two Chinese companies withdrew from the projects, after signing the MoUs with the government.Investment Board Nepal and National Hydro Power Corporation Ltd signed MoU on August 11, to develop the two projects on the Seti River. The projects will develop a total of 1,200 MW. The projects will be spread over four districts of Bajhang, Doti, Dadeldhura, and Achham, according to ET. Prime Minister Narendra Modi and his Nepalese counterpart Sher Bahadur Deuba had earlier committed to expanding the power sector partnership. "During my recent visit to India, Prime Minister Narendra Modi and I agreed on a vision statement on cooperation in the power sector, underlining the need for strengthening mutually beneficial bilateral cooperation in this sector. Furthermore, during the visit of Prime Minister Modi ji [SIC] to Lumbini, we had a productive discussion on this matter and I invited the interested companies from India for the development of the West Seti Hydroelectric Project,” Deuba said after the deal between Nepal and India's National Hydro Power Corporation Ltd was signed.Chinese companies have withdrawn from the West Seti Project twice. In 2009, China National Machinery and Equipment Import and Export Corporation (CMEC) signed an MoU with the government to develop the project. However, the company stepped back within two years.In 2017, China Three Gorges International Corporation set up a joint venture to develop the project. It withdrew from the project in 2018.ET further reported that Nepal can earn up to Rs 31,000 crore per year by 2030 and Rs 1 trillion per year by 2045 if it sells electricity to India by harnessing its hydropower potential.