Kathmandu, April 3:

Nepal and India signed two Memoranda of Understanding (MoU) here in Kathmandu today.

Ambassador of India to Nepal Shiv Shankar Mukherjee and secretary of Ministry of Finance (MoF) Vidhyadhar Mallik inked two MoU — the rehabilitation of 15 MW Devighat Hydropower plant and development of 1,000 Shallow tube wells in Dhanusha and Mahottari districts — on behalf of their respective governments.

According to the MoU on rehabilitation of Devighat Hydropower plant, India will provide grant assistance of Rs 240 million for the rehabilitation of the 15 MW Devighat Hydropower plant.

The total cost of the rehabilitation is estimated to be Rs 512 million. Nepal will finance the remaining cost from its own internal resources or through soft loan extended by the Export-Import Bank of India.

The Devighat Hydropower plant was built through Indian grant assistance in 1984 with Rs 750 million. The project is linked to Trishuli Hydropower station that was also built through Indian assistance in 1967.

In addition to rehabilitation of Devighat Hydropower plant, India has offered — in response to Nepal’s request — to provide grant assistance for the development of 250 MW Namure Storage project for the domestic power supply.

India is also supporting, through the soft loan, the development of Rahughat Hydropower project and cross border transmission highways which, in the short to medium term, will help ameliorate Nepal’s deteriorating power situation.

Under the second MoU on development of Shallow tube wells, India will provide grant assistance of Rs 88.69 million towards 86 per cent of the cost for development of 500 Shallow tube wells each in Dhanusha and Mahottari districts. Respective farm-er’s groups as per government’s rule would contri-bute remaining 16 per cent of the cost of the tube wells. Ground Water Resources Development Board, Ministry of Water Resources and the government would execute the project.

These Shallow tube wells would provide irrigation facility to over 3000 hectares of land and would uplift the socio economic status of farmers, said envoy Mukherjee after the signing ceremony.

“India has consistently attached importance to assist Nepal and its people to achieve lasting peace and economic development,” he said, adding that the two projects would contribute towards the development of agriculture. He also informed that more than 265 large and small development projects totalling over Rs 21.5 billion are currently being undertaken in Nepal with the assistance of India.

Finance secretary Vidhyadhar Mallik thanked the Indian government for its continuous support towards Nepal’s development.