India okays deal to buy power from Nepal

By Laxman Kafle,Kathmandu, Sept. 6: India has approved the memorandum of understanding (MoU) on long-term electricity trade signed during Prime Minister Pushpa Kamal Dahal Prachanda's visit to India to purchase up to 10,000 megawatts of electricity from Nepal in next 10 years.

Nepali Ambassador to India Dr. Shankar Prasad Sharma wrote on X (formerly known as Twitter) that India’s Union Council of Ministers formally approved the agreement signed between Nepal and India to purchase 10,000 megawatts of electricity from Nepal within the next 10 years.

During the four-day official visit of Prime Minister Prachanda to India in June, an agreement was reached between the two countries on the issue.

PM Prachanda had paid a visit to India from May 31 to June 3 this year. 

Ambassador Sharma has expressed confidence that the decision of the Indian government has paved the way to develop a new roadmap for electricity development in Nepal and it will make a significant contribution to the economic development and restructuring of the country. During the visit of Prime Minister Prachanda to India, the energy secretaries of Nepal and India had signed the MoU for long-term power trade.

Joint Secretary at the Ministry of Energy, Water Resources and Irrigation Madhu Prasad Bhetwal said that he received information that the Council of Ministers of the government of India had approved the MoU to buy 10,000 megawatts of electricity in a decade.

"Information may be coming formally, informally the decision has been made," he said.

Soon after the decision of the government of India, the energy secretaries of both countries will jointly sign a deal for the implementation of the decision by organising a special event.

He said that the decision of the government of India to purchase 10,000 MW of power in 10 years would open the door for the construction of mega hydropower projects in Nepal. “This is a milestone for Nepal in the hydropower sector. The process to materialise such a decision will begin from both countries at the earliest,” he told The Rising Nepal.

Currently, Nepal is exporting 452 megawatts of electricity to India under a short-term agreement. Besides, the government of India has also decided to purchase additional 180 MW of electricity from Nepal.

President of Independent Power Producers’ Association, Nepal (IPPAN) Ganesh Karki said that the approval of the power trade agreement signed during the Prime Minister’s India visit is a notable achievement in the hydropower development sector of Nepal.

“We, including the government, hydropower developers and the Nepal Electricity Authority, were not sure whether India would purchase electricity or not as per the MoU. But since India has decided to buy power, our confusion is now over. It has encouraged us to generate more power," he said.

Karki said that it was essential to focus on the production of electricity to supply it as per the latest decision of the Indian government. He said that Nepal should make a roadmap to generate at least 30,000 megawatts of electricity within the next 10 years.

Stating that the private sector has suggested the government should proceed with a target of 30,000 megawatts of electricity production in 10 years, he said that within 10 years, 10,000 megawatts will be consumed in Nepal and 10,000 megawatts can be exported to India and the rest to Bangladesh. Karki also stressed the need to promote the consumption of electricity within the country.