If West Seti and its cascade project are developed in time, Nepal and India could benefit from them
As India has been facing acute shortage of energy in its local market due to the ongoing war in Ukraine as well as a short supply of coal to its thermal plants, India appears to have focused its attention on making investing in Nepal's hydropower projects, which could meet its energy demand if harnessed with full potentials. India has already made its investment in 900 MW Arun III hydropower project in Sankhuwasabha and, a Memorandum of Understanding was signed to develop 490 MW Arun-4 Hydropower Project when Indian Prime Minister Narendra Modi visited Lumbini, the birthplace of Lord Buddha, on May 16. Indian government-owned Setlej Jal Vidhyut Nigam will be developing both the projects with a provision of 21 per cent free energy to be availed to Nepal for 25 years, after which both the projects will be handed over to Nepal in good condition.
The 51st meeting of the Investment Board Nepal (IBN), chaired by Prime Minister Sher Bahadur Deuba, has also decided to develop 750 MW West Seti and 308 MW Seti River-6 through direct negotiations with NHPC Ltd, Government of India Enterprises.
The Nepal government is planning to develop both the projects as cascade projects in the far-western region, where no major hydropower projects have been developed so far.
The IBN meeting also decided to extend two more years for the GMR, the developer of the 900 MW Upper Karnali Hydropower Project, to conclude its financial closure on the condition that the project developer will have to conclude Electricity Sales Agreement with Bangladesh Power Development Board and India's National Thermal Power Corporation Limited (NTPC) by June 2022.
However, the GMR, which won the contract to develop the Upper Karnali Project eight years ago, has not been able to arrange required funds for the project and, it has also failed to ensure secure markets for the energy generated from the Upper Karnali Project. The future of the Upper Karnali is uncertain though the IBN, chaired by the PM himself, has been extending time for concluding the financial closure.
Earlier, a subsidiary company of China's Three Gorges Corporation – China Three Gorges International Corporation (CTGIC) – which was awarded the project through direct negotiation in 2012, pulled out of the West Seti project, citing it being financially unfeasible because of resettlement issue involved although the IBN had assured of giving more concessions.
The CTGIC decided to pull out of the project as it did not see any guarantee that the energy to be produced from West Seti could be sold to India and, Nepal would not be able to consume all the energy from it. If West Seti and its cascade project are developed within the stipulated time, Nepal and India, which have already developed construction modality and sharing of energy, could immensely benefit from them. However, Indian side should also show more flexibility in its policy when it comes to importing energy from Nepal. Till date, India has allowed Nepal to export energy produced only from the Nepal government and Indian investments. Both Nepal and India will be in a win-win situation if India is ready to buy Nepal's surplus energy during the wet season and also at competitive price.
Six-day week
The government has revoked its decision to provide a two-day weekend, just weeks after making the announcement. The government had decided to give an extra holiday on Sundays beginning May 9 in a bid to slash fuel bills and conserve the fast-depleting foreign currency reserve. The decision is, however, being reversed beginning June 15, meaning office holders get only a Saturday as public holiday. The two-day weekend had come under fire from many quarters, as banks were also closed for two days, and local government offices had to stay open till late in the evening due to the rush of service-seekers.
This is not the first time that the country had gone for a two-day weekend. The government should have learnt lessons from the experiment carried out during the premiership of Krishna Prasad Bhattarai in the nineties. Apart from the inconvenience, the kneejerk reaction this time to the fuel crisis and depleting foreign exchange reserve has not had the desired result, with people travelling far and wide with their families to enjoy their weekend. If the government is really serious about cutting down on fuel imports then it should introduce the odd-even rule on vehicles immediately.
A version of this article appears in the print on June 8, 2022, of The Himalayan Times.