CIAA tones down orders against hydro projects

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    CIAAKATHMANDU, DEC 16 – The Commission for the Investigation of Abuse of Authority (CIAA) has toned down its directive on terminating the licences of 14 hydropower projects including the Kabeli-A Hydropower Project to allow the Energy Ministry to decide their fate on its own.

    Speaking at a meeting of the parliamentary Agriculture and Water Resources Committee (AWRC) on Monday, CIAA Acting Secretary Prem Kumar Rai clarified that the CIAA’s

    directive was not obligatory but more a recommendation, and that the executing agency, the Energy Ministry, could reach an appropriate decision on its own.

    The chief of the anti-graft body Lok Man Singh Karki said he could not attend the meeting as he was out of station. He sent his representative Rai in his place who said that the corruption watchdog was in favour of hydropower development as the country was in the midst of a power crisis.

    “As an anti-graft body, our task is to make the line ministries aware, and we have done that in these cases. The Energy Ministry can proceed with what they feel should be done based on the laws of the country.”

    Rai said that the Energy Ministry should study, investigate and take the appropriate step regarding the 14 hydro projects, adding that a few of the 14 projects that came under the CIAA’s scrutiny had fallen behind in concluding their financial closure apparently due to the incompetence of the Nepal Electricity Authority (NEA).

    Meanwhile, Energy Ministry officials said that the ministry was aware of the status of the projects in the CIAA’s sights. Energy Secretary Rajendra Kishore Kshatri said they had already conducted a study of the 14 hydel projects and were aware about the overall issue of the individual projects.

    “We can come up with a concrete decision over the fate of the projects, but we need to know clearly that the ministry can do that,” he added.

    The government and the World Bank recently signed a loan agreement to finance the Kabeli-A, one of the 14 projects that received a jolt from the CIAA for incomplete paperwork.

    Under the accord, the developer will bear the exchange rate risk but receive the loan at a lower rate of interest.

    Joint secretary at the Finance Ministry Madhu Marashini said that the financial closure of Kabeli-A had been delayed due to bureaucratic procedures.

    The government’s attempts to get $6 million from the World Bank as a grant to enhance the capacity of the Department of Electricity Development and Investment Board Nepal to prepare and negotiate power development deals delayed the process, said Finance Ministry officials.

    The World Bank had insisted on classifying the entire assistance as a loan as per its revised policy, but since the $6 million had already been pledged as a grant, the government asked it to stick to its word. The CIAA had ordered the licence of Kabeli-A to be cancelled for its failure to conclude the financial closure on time.

    Source : eKantipur