India, Nepal Sign Deal To Build Hydroelectric Power Plant to allay power shortages

India and Nepal agreed on Monday to develop a 695-megawatt hydroelectric power facility in the Himalayan country. This will allow Nepal to tap into its rich supply of clean energy to alleviate power shortages.

The electricity trading agreement between India and Nepal is worth billions of dollars. The Arun IV project is being built by the state-owned Nepal Electricity Authority and India’s Satluj Jal Vidyut Nigam Limited on the Arun River in Nepal’s east region. India has 49 percent of the equity, while Nepal owns 51 percent.

“Nepal will get 152 megawatts of free electricity from the plant for its consumption and the rest will be split between the two on the 51% and 49% basis,” Nepal Electricity Authority spokesperson Suresh Bahadur Bhattarai told Reuters. “Cost of the project is being worked out and whatever it comes will be shared as per the above ratio.”

According to PTI, Satluj Jal Vidyut Nigam chairperson Nand Lal Sharma and Nepal Electricity Authority Managing Director Kulman Ghising signed a Memorandum of Understanding.

In Nepal, Satluj Jal Vidyut Nigam operates three projects totaling 2,059 megawatts. According to PTI, the public sector endeavour plans to have 5,000 megawatt plants in the Himalayan country by 2030.

Nepal is currently in talks with Indian corporations about exporting its abundant electricity. Prime Minister Narendra Modi has pledged India’s continued assistance for Nepal’s hydropower development and encouraged Indian developers to pursue more similar projects.

According to the Ministry of External Affairs, the hydroelectric power plant pact is one of six agreements that Modi signed with Nepal Prime Minister Sher Bahadur Deuba during his sixth visit to the Himalayan country on Monday.

In Lumbini, Nepal, Modi met with Deuba for bilateral talks.

The two prime ministers discussed concrete plans and proposals to further deepen cooperation in a variety of sectors, including culture, economy, commerce, connectivity, energy, and development partnership, during their bilateral meetings.

The two countries will try to develop ties between Nepal’s Lumbini and Uttar Pradesh’s Kushinagar Buddhist sites. The India International Centre for Buddhist Culture and Heritage was also inaugurated by Modi.

The visit also “emphasizes the deep and rich civilizational connect between India and Nepal and the contribution of people on both sides to foster and promote it,” said the Ministry of External Affairs.

India and Nepal’s relations are “unshakeable like the Himalayas”, said Modi in his speech at the Buddha Jayanti event at Lumbini, The Indian Express reported. “India and Nepal’s ever-strengthening friendship will benefit the entire humanity in the emerging global situation.”