Nepal signs USD 1.3 bn mega-deal with Indian company to develop 679 MW Lower Arun Hydropower project

KATHMANDU: Nepal has signed a USD 1.3 billion deal with India's hydropower major Satluj Jal Vidyut Nigam (SJVN) to develop a 679-megawatt hydropower project in eastern Nepal, the second mega venture undertaken by India in the neighbouring Himalayan nation.

The single largest foreign investment project, based on the 2017 cost estimates, is located between Sankhuwasabha and Bhojpur districts in eastern Nepal, according to a press release issued by the Investment Board Nepal.

The 679-megawatt Lower Arun Hydropower project is the second mega project undertaken by India after the USD 1.04 billion 900-MW Arun-3 hydroelectric project.

A memorandum of understanding for the project was signed by the Investment Board of Nepal Chief Executive Officer Sushil Bhatta and SJVN Chairman and Managing Director Nand Lal Sharma in Kathmandu on Sunday, according to the Investment Board Nepal.

According to the board, the developer needs to complete the detailed project report of the project and submit it for approval at the board within two years from the agreement date.

The project will be developed under the build, own, operate and transfer (BOOT) model.

Speaking as the chief guest during the signing in ceremony, Nepal Finance Minister Bishnu Prasad Paudel expressed commitment to extend necessary cooperation and support on behalf of the government to expedite and fast-track the development of the project.