Kathmandu, February 25

A study report has shown that 46 per cent of locals affected by the 900-megawatt SJVN Arun III Hydropower Development Project located in Sankhuwasabha district have purchased land with the compensation that they received for their land that was acquired by the project.

The finding was revealed in a study titled ‘Use of cash survey (Arun III) Hydropower Project’ conducted by the Investment Board Nepal (IBN). The board has said that the main purpose of the study was to ascertain how the affected people had utilised the cash compensation that they had received.

The study shows that around half the affected people had used the compensation to purchase fixed assets like land and houses. Most have procured such assets close to their original dwellings. As per the report only a small number of families have purchased agricultural land.

One of the worrying findings of the study is that only 15 per cent of the project affected families who were previously engaged in agriculture were interested to continue with their previous profession after receiving the compensation.

The study also reveals that among those who bought fixed assets, 49 per cent have bought/constructed houses.

After fixed assets, use of compensation in services such as education and health was found to be the second most preferred area of investment as 17 per cent used the compensation in education and health services. Similarly, 15 per cent of the households used the compensation in repaying family loans, while almost 11 per cent used it in unspecified areas. Only five per cent of the families used the compensation in businesses.

Arun-III is an export-based hydropower project, which will bring the largest ever foreign direct investment (FDI) from India worth Rs 102 billion. The project has paid land compensation worth Rs 1.30 billion so far and has estimated that it will have to spend a total of Rs two billion for land acquisition process.

Apart from distributing shares to the locals and free energy to the affected area, the government will also get Rs 330 billion as royalty for a period of 20 years. The project will also have to provide 21.9 per cent of the generated energy free of cost. The Arun III hydropower project will generate 400 million units of power every year.

As per the project, the locals were provided Rs 8.25 lakh per ropani as compensation for uncultivated land and Rs 9.07 lakh per ropani for cultivated land. Similarly, compensation of Rs 1.43 million per ropani was fixed for cardamom fields and Rs 1.2 million per ropani for land with crops.

According to Hareram Subedi, Nepal office head of the project, the project still needs to acquire 33 hectares of land. The project has already provided compensation for 50 hectares of land in the affected district.