Kathmandu: India on Tuesday officially gave its approval to a memorandum of understanding (MoU) concerning the purchase of electricity from Nepal. Under this agreement, India has agreed to import 10,000 megawatts (MW) of electricity from Nepal in the next ten years. According to Nepal’s ambassador to India, Dr Shankar Prasad Sharma, the federal Council of Ministers of India formally endorsed the agreement paper on the power trade with Nepal. He said the decision would contribute to accelerating Nepal’s economic development and restructuring efforts. “India’s cabinet approval to purchase 10,000 MWs of electricity from Nepal in the next ten years has paved the way to develop a new road map for electricity development in Nepal. This could play a significant role in the economic development and restructuring of Nepal,” Dr Sharma wrote on Twitter.
The MoU was initially signed between the two countries during Prime Minister Pushpa Kamal Dahal Prachanda’s latest visit to India (May 31-June 3, 2023). Nepal PM termed the moment historic at the time.
Energy secretaries from both countries signed and exchanged the document. Following India’s latest decision to endorse the agreement, the energy secretaries from both neighboring nations will participate in a special ceremony to formally re-sign it. Joint Secretary at the Ministry of Energy, Hydro Resources and Irrigation and Spokesperson for the Ministry, Madhu Prasad Bhetuwal said they were unofficially informed about the official decision of the Indian government to endorse the agreement and expect to receive an official confirmation regarding the decision.
With this decision, door to export the electricity produced in Nepal to Indian market in easy and smooth manner has been opened. Nepal had been urging for power export in Indian market in short-term, mid-term and long-term. The Nepal Electricity Authority (NEA) has been exporting 452 megawatts of electricity in Indian Energy market on a daily basis. Nepal and India had signed power trade agreement in 2014. The Indian Company, Satluj Jal Vidyut Nigam, is constructing 900-megawatt Arun III hydropower project. Similarly, Indian company has forwarded necessary process for the construction of different projects including Lower Arun, West Seti and SR-6. An agreement has been reached between Nepal and India to construct some projects after preparing joint investment. Nepal has been making preparation to export 40 megawatts of electricity to Bangladesh soon.
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