Kathmandu, January 11:

Nepal Electricity Authority (NEA) is going to issue power bonds in few months to promote people to invest in hydro-electricity sector.

In this connection, the NEA signed a Memorandum of Understanding today with the Nepal Merchant Banking and Finance Limited (NMBFL), authorising the bank to distribute bonds worth Rs 3 billion for NEA and collect domestic investment in various power projects.

“This is the first time NEA is inviting investment from general public in power plants. Looking at the people’s general trend to invest, we believe that we will achieve the target within time,” said Arjun Bahadur Karki, the managing director of NEA.

He also said that the money collected through power bonds will be invested in Chameliya Project, Kulekhani III Project and also for Middle Marsyandi Project to be launched in near future.

He said, “By issuing power bonds, we are trying to prove that Nepal has enough of capital to invest in power sector,” adding that the huge budget deficit in NEA is slowly improving.

Upendra Paudel, the Chief Executive Officer of NMBFL, said the bank will prepare a prospectus for NEA in some weeks and after it is approved by the Securities Board and then publicly announce distribution of bonds.

“It is just like depositing your money in a fixed deposit. We will offer better interest than the banks, distribute interests in every six months and finally will pay back the whole sum,” he said.