• A quarter of the estimated cost of Rs 200 billion will be spent on compensation for inundated land areas

Kathmandu, May 23

The government today decided to build the much-talked about Budhi Gandaki Hydropower Project in an EPCF model and agreed in principle to award the project to China’s Gejuwa Group.

A Cabinet meeting held at the Prime Minister’s official residence in Baluwatar today decided to award the construction contract of the 1,200MW storage project to the Chinese firm.

The project will be developed in Engineering, Procurement, Construction and Financing (EPCF) model, as per which, the concerned construction company itself generates the required fund for the project, Minister for Women Children and Social Welfare Development Kumar Khadka told The Himalayan Times. “The EPCF is a new model to develop hydel projects in Nepal,” Minister Khadka said. “So far we have been developing projects in EPC (Engineering, Procurement and Construction) model.”

He, however, said the government was yet to make a formal decision to which company this project would be awarded. It’s learnt that Ministry of Finance has been authorised to sign an MoU with Gejuwa to this effect, a source said. Minister for Information and Communications Surendra Karki said that now the Ministry of Energy would hold discussions on details of the project, including the mode of financing and construction timeframe.

Prime Minister Pushpa Kamal Dahal and his predecessor KP Sharma Oli had both sought Chinese investment in national pride projects during their visits to the northern neighbour in March 2017 and March 2016, respectively.

The estimated cost of the Budhi Gandaki Hydro Power Project is Rs 200 billion, a quarter of which will be spent on compensation for inundated land areas and residences in project affected sites in Dhading and Gorkha districts. At least 13 previous VDCs of Dhading and 14 VDCs of Gorkha will be affected by the project.

The Cabinet also appointed Apendra Sharma as general manager of the national news agency - Rashtriya Samachar Samiti and Sharad Bikram Rana as executive director of Trade and Export Promotion Centre, according to Minister Karki.