The SC has seen no need for the power project to be ratified by the parliament
The Supreme Court verdict, which quashed the writ petitions filed against GMR company and the government for allowing the private Indian conglomerate multiple extensions to conclude the financial closure for the 900 MW Upper Karnali Hydel project, has paved the way for taking the venture forward. The apex court had, however, on May 7 this year given a directive order – whose full text was released on Friday – to the government not to extend the financial closure time for the much-delayed project any more, which should put heavy pressure on GMR to find the required resources as well as the market for the power generated at the earliest. The Indian company was awarded the project, to be developed on the build-own-operate-transfer model, way back in 2008, and an agreement for its construction was signed between GMR and Investment Board Nepal (IBN) in September 2014. GMR was given two years to conclude the financial closure for the project. However, despite two extensions – in January 2017 and November 2017 by IBN – it failed to make much headway.
The Cabinet gave a third extension of two years in July 2022 to conclude the financial closure by even amending the laws.
However, the Supreme Court on November 3 last year had issued an interim order against the government's decision to extend the period for making financial arrangements, which it has now overturned.
As per the court verdict, the company will now get an additional six months to finalise the financial closure to make up for the period of the interim order.
This means GMR has till February 2025 to come up with the resources. Ten years is a lot of time to carry out a hydropower project, and inability to conclude the financial closure in time despite multiple time extensions means that it has either no money or that it is not serious about developing the project. This should be seen as the last chance for GMR to undertake the project that the people of the far west have been hoping will change their socioeconomic condition. The verdict allowing for the extension of the financial closure time should clear the way for GMR to conclude an agreement to sell electricity to Bangladesh, which has shown interest in buying upto 500 MW from the project.
Another interesting aspect of the SC verdict was that it saw the agreement between GMR and the government as a contract, not requiring it to be ratified by a two-thirds majority in the parliament as it did not involve the distribution of a natural resource like water.
The electricity the project would generate was akin to a consumer good produced from a natural resource.
The verdict should serve as a reference for other projects where confusion persists about when something constitutes a natural resource and when it does not. While GMR sets about making the financial arrangement, the government has the onus to acquire land for the project in Accham district without delay, and provide employment and adequate compensation to the people who would be displaced, as directed by the top court. The free energy and the share of the government in the project should allow it to invest in the overall development of the residents living in the Karnali watershed and the ecology of the region.
Unknown disease
It is reported that more than 300 people, mostly women and children, have been suffering from an unknown disease in Tilgufa Municipality-10 of the remote district of Kalikot for the last several weeks.
The Kalikot District Hospital sent a medical team to ascertain the exact cause of the illness of the patients and collected blood samples in Rudu village of the municipality on Saturday. The affected people complained of multiple symptoms, such as fever, throat pain, headache, tonsillitis, rashes on the face and swollen limbs.
A team of experts must be sent from Kathmandu to the affected area to find out the exact causes of the disease. Distributing medicines to the affected patients without conducting a thorough investigation will not help bring the disease under control. This kind of situation would not have arisen had the government, particularly the local level which is responsible for managing the health centre of its area, established a fully functional health institution. Most of the health centres in rural parts of the country lack doctors, nurses and medical equipment, which are essential to provide effective health care to the local population. The federal government should also depute medical professionals in the rural parts of the country on a regular basis.
A version of this article appears in the print on July 10, 2023, of The Himalayan Times.
