The government of Nepal adopted, a few years ago, the policy of permitting domestic and foreign private investors to put money into hydropower projects in the country, generate and sell electricity. It also granted survey licences that could be held once obtained for years, encouraging a strong tendency among licence-holders just to sit on their licences to prevent others from getting those projects. This has affected hydropower generation. Though belatedly, the government last year tried to take a corrective step by amending the relevant law and regulations. Very recently, the outgoing government is reported to have issued survey licences for hydropower projects to 15 promoters within almost as many days, and the total capacity of the 15 projects comes to 185 MW. This speedy action on applications during the last days of a caretaker government raises a serious issue of political morality.

The government last year also introduced a multi-fold increase in the fees of acquisition and renewal of hydropower survey licences. Accordingly, survey licences, renewable annually, cannot be extended more than four times. The reason behind the hike in survey licence fees is said to encourage licence holders to achieve satisfactory progress on work schedules, and several licences have been revoked on the grounds of ‘unsatisfactory’ progress. Nor should delay be allowed in the construction of a project beyond a reasonable time; indeed, sometimes, unforeseen or uncontrollable factors might set back progress to some extent even after construction has been under way. Such genuine cases deserve leniency. If any factors, such as the lack of expert personnel, affect monitoring, the deficiencies should be corrected.

Water constitutes a vital resource of the country capable of transforming its economy and improving the standards of living of the people, if developed fully and on fair terms for Nepal when a project contract is awarded to foreigners. Therefore, the merits and demerits of any project, especially of a project of a fairly large capacity, for the government and the people of Nepal, need to be widely and intensely debated in public before the project contract is signed. When, in the 1990s, Arun III was to be started by the Nepalis with international grants and loans, such a wide, intense and protracted debate was conducted in public (so much so that anti-Arun III activists went to America to lobby with the World Bank). The result was that the project was eventually killed when it was about to get off the ground. But during the post-Jana Andolan II period, several hydropower projects, including Arun III, have been awarded, but, strangely, hardly any public debate took place, leading one to wonder where the hydropower activists of yesteryear have gone. The constitutional provision that still exists requires a parliamentary ratification of any treaty or agreement on the country’s natural resources and the distribution of their uses. But the interim government awarded several such contracts without fulfilling this requirement, leading to court cases that still continue. Public debate serves as a safety valve, among other things.