From the Nepali Press
Sachen Gautam in Naya Patrika, 9 December
India has issued new directives on cross-border trade of electricity, discouraging other countries and non-Indian companies from investing in export-oriented hydropower projects in Nepal.
The guidelines issued by the Indian Ministry of Power this week have virtually ended the possibility of more investment from China and other countries.
This paves the way for India to import electricity from neighbouring countries like Nepal, Bhutan and Bangladesh, but restricts the trade in hydroelectricity generated by other countries and non-Indian companies.
“These guidelines are restrictive,” says Prabal Adhikari, spokesperson for the Nepal Electricity Authority (NEA). “They favour only Indian companies.”
As per these guidelines, India will now only buy electricity from the proposed 900 MW Upper Karnali (the Indian private company GMR) and the 900 MW Arun III project (the Indian public sector company Sutlej).
But India’s electricity market is now closed for hydropower generated in Nepal by other countries like China, America, Korea and Norway. Even Nepal cannot build a hydropower project on its own and sell electricity to India.
The Independent Power Producers’ Association, Nepal (IPPAN) President Khadga Bista says: “These guidelines have forced Nepali and other companies to give at least 51 per cent share to Indian companies if they want to export electricity to India.”
India has given ‘strategic, national and economic importance’ to the new cross-border electricity trade guidelines, which also bars Nepal from buying electricity produced by non-Indian companies and selling it to India.
What is in the guidelines?
5.2.1) Considering that electricity trade shall involve issues of strategic, national and economic importance, participating entities (Participating Entity (ies)) complying with following conditions shall be eligible to participate in cross-border trade of electricity after obtaining one-time approval from the Designated Authority.
- a)Import of electricity by Indian entities from generation projects located outside Indian and owned or funded by Government of India or by Indian Public Sector Units or by private companies with 51% or more Indian entity (entities) ownership.
- b)Import of electricity by Indian entities from projects having 100% equity by Indian entity and or the government/government owned or controlled company (ies) of neighbouring country.
- c)Import of electricity by Indian entities from licensed traders of neighbouring countries having more than 51% Indian entity (ies) ownership, from the sources as indicated in para 5.2.1 (a) and 5.2.1 (b) above.