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VOL. 28, NO. 06, Sept 26 , 2008 (Ashwin 10 2065 B.S.)
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THIRD POWER SUMMIT
Power Points
Officials, experts and businessmen from Nepal and India discuss ways for expanding cooperation in hydropower
By SANJAYA DHAKAL
The mood during the Third Power Summit (September 23-24) this year was palpably more positive than the two summits in the past.
The mood had, in fact, been set to this mode since the announcement by the new government led by Maoists that Nepal will target to build 10,000 MW of power within next ten years – a bulk of which will have to be exported to next door neighbor India.
As the cost of building that quantity of power is estimated to stand around $ 20 billion, the financing would have to come from private sectors of not only the two countries but also from international investors.
In fact, addressing the summit, India's Minister of State for Commerce and Power Jairam Ramesh said that it will need the role for the government of India and Nepal to raise such a huge amount of resources.
"I don't believe that private capital markets are alone going to provide $ 20 billion. There has to be a role for the government of Nepal, government of India and other governments in the region," Ramesh said.
At the inaugural session of the Summit, Nepalese ministers made elaborate statements urging investment and assuring security.
Deputy Prime Minister and Home Minister Bamdev Gautam said, "This government has attached highest importance to maintaining law and order. I assure you that we will provide full security to investors and the projects." His views were echoed by Water Resources Minister Bishnu Poudel. "Most of the investors whom I have met have raised the issue of security. This government is capable of delivering security. I want to assure you all," he said, adding that the government would make all necessary changes to move on a 'fast pace' to realize the hydropower potential.
Indian Minister Ramesh had also pointed at the economic benefits for Nepal from generating power. "Export of power will undoubtedly earn for Nepal substantial revenues. Nepal's electricity potential could also be used to attract Indian investments in electricity intensive industries, exports of which to India could help bridge the trade deficit that Nepal has been concerned in relation to India – a legitimate concern, I might add, since we too are worried about our growing trade deficit with China."
"I would also state straightaway that we recognize Nepal's sensitivities and, therefore, fully appreciate that our interactions have to be at a pace and in a manner with which Nepal is comfortable," the Indian minister said.
The Indian minister even went on to add, "The remote control is in your ( Nepal's) hands. If you want to press fast forward, India will go ahead in fast forward mode. If you want to press pause, India will join you in the pause mode. I hope you will not press rewind button."
Tantra Narayan Thakur, Chairman and Managing Director of Power Trading Corporation (PTC) of India, said that Nepal should first fulfill its need and then export surplus power to India. "The harnessing of 10,000 MW in ten years is a huge task but a doable one," he said.
Sandip Shah, president of Independent Power Producers Association of Nepal (IPPAN), said that political will for harnessing power on a business basis is getting stronger on both sides in recent times. "We have been holding power summit since 2006 in order to promote the hydropower cooperation at business to business level apart from government to government level," said Shah.
Arun Chaudhary, the president of Nepal India Chamber of Commerce and Industry (NICCI), said that it was only because of 'too much politicization' that Nepal could not harness its hydropower in the past and had to suffer from 40 hours a week of load shedding despite being so rich in water resources.
"There is a huge yearning in Nepal to regain the opportunities lost in the last ten years due to conflict. There cannot be such a good match between India – which is hungry for energy – and Nepal – which is rich in hydropower especially since the hydropower is now being regarded as a trading commodity," said Chaudhary.
The two-day Power Summit 2008 had been jointly organized by IPPAN, NICCI and PTC. More than 300 delegates from India, Nepal and other countries took part in the summit. Some of the Indian sponsors of the event were leading names of Indian power sector such as – Jindal, GMR, Suzlon, Athena, AES, IL&FS, and Satluj Jal Vidyut Nigam. Similarly, from Nepal, SN Power, BPC, ICTC, West Seti and Moserbaer sponsored the event.
The two-day summit primarily focused on the hydropower cooperation between Nepal and India along with the discussions on the regulatory environment and various project development issues impacting the growth of hydropower in Nepal. They also discussed issues relating to transmission, interconnection and power trade. The power summit was participated by the leading development financial institutions, eg the World Bank, IFC, DEG, ADB etc that provide with the financiers' perspective on the various hydropower projects in Nepal.
The discussion also took place on the Developers' Perspective pertaining to risk in the hydropower projects. The delegates discussed in length the various models of cooperation that could be possible between India and Nepal.
