Nepal, India sign MoU to construct Arun-4 hydropower project

Prime Minister Sher Bahadur Deuba holds bilateral talks with Indian Prime Minister Narendra Modi. (Photo: MEA India)

NL Today

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Kathmandu: A bilateral memorandum of understanding for the construction of the identified 490.2 megawatts Arun-4 hydropower project has been signed between the governments of Nepal and India.

Managing Director of Nepal Electricity Authority (NEA), Kulman Ghising and chairperson and operation manager of the Indian hydropower company Satluj Jal Vidyut Nigam, Nanda Lal Sharma signed the MoU for the joint venture semi-reservoir-based hydropower project between the NEA and Nigam, in the presence of Prime Minister of Nepal, Sher Bahadur Deuba and his visiting Indian counterpart Narendra Modi.

During the visit of PM Deuba to India in the first week of April, an agreement was reached between the two countries to construct the project. NEA has a share of 49 percent investment and the Nigam 51 percent in the estimated Rs 79.1 billion project located at the upstream of the Arun-III hydropower project in Sankhuwasabha district.



Nepal will get free 21.9 percent electricity monthly from the project. The Nigam will initiate the management of the sales of produced electricity and the budget for the project. Nepal has reserved the right to purchase electricity generated from the project if it can afford to consume it. Only then, power generated from the project will be sold elsewhere to India or Bangladesh.

The project has a capacity of generating 2.1 billion units of electricity annually.