- To facilitate investments in hydropower
- Separate agreements for investment and construction of cross-border transmission lines
- No tax on power trade
- Non-discriminatory access to cross-border interconnections for licensed participants
The eight-point agreement signed by Energy Secretary Rajendra Kishore Kshatri and his Indian counterpart Pradeep Kumar Sinha in New Delhi has paved the way for both the countries to sell and purchase electricity through synchronized connection.
In a major departure, the agreement also envisages extending markets for electricity generated by hydropower projects in Nepal at the sub-regional and regional level.
Talking to media persons, Minister for Energy Radha Gyawali expressed happiness as India signed the agreement as proposed by Nepal through its latest draft sent to Delhi after all-party consensus.
“The agreement encourages national and international developers to invest in hydropower sector by ensuing them market for electricity,” said Gyawali, adding that there was unnecessary hue and cry over first draft received from India. Minister Gyawali also said the PTA has no controversial provision on the issue of power cooperation. She also credited the new government in India led-by Narendra Modi and change in policy toward Nepal for the achievement.
Article VI of the agreement says, “The agreement shall not affect in any way the obligations of the parties under existing bilateral agreements between the parties as well as their existing agreements with other countries.”
Minister Gyawali also said that she will soon forward the signed document to Prime Minister Sushil Koirala for endorsement by the cabinet. The agreement will come into effect after endorsement by the cabinet of both the countries.
Both the governments had agreed to sign PTA within 45 days during Indian Prime Minister Narendra Modi’s visit to Nepal in August first week.
Hydropower developers have heaved a huge sigh of relief and are hopeful of sustainable power supply through two-way power exchange.
Source : Republica
KATHMANDU: Nepal and India today sealed the much anticipated and debated power trade deal, without incorporating provisions on power generation as requested by the government.
The Agreement on Electric Power Trade and Cross-Border Transmission Interconnection and Grid Connectivity was initialled by Energy Secretary Rajendra Kishore Kshatri and Indian Power Secretary Pradeep Kumar Sinha in New Delhi, Energy Minister Radha Kumari Gyawali said.
This agreement will now have to be endorsed by the Cabinet. However, it is not yet known whether the pact will have to be ratified by the Parliament as well. “The Cabinet will take a decision in this regard,” Minister Gyawali said.
“The agreement aims to enhance friendly relations and mutual trust between Nepal and India through increased cooperation in the field of transmission interconnection, grid connectivity and power trade. It facilitates government, public and private enterprises in planning and construction of interconnection facilities and power trade,” reads a statement issued by Embassy of Nepal in New Delhi today.
Once the agreement comes into force, Nepal will be able to purchase electricity from India when production here falls and sell power to the southern neighbour whenever there is a surplus.
This deal would also provide access to domestic and international hydro project developers to the vast market in the south, where they can sell electricity generated here.
Nepal can use this facility to draw foreign investment in the hydro sector, as electricity produced here can now be officially sold in India.
However, the country may not be able to sell power to countries other than India for now, as the agreement is silent on that, the minister said. This means the Indian side did not entertain Nepal’s proposal to incorporate a provision on regional and sub-regional grid connectivity in the agreement.
To implement all the provisions incorporated in the agreement, Nepal and India today formed a secretary-level joint steering committee and a joint secretary-level joint working group.
“They (the committee and the group) will promote and facilitate cooperation in areas identified in the agreement, including planning and identification of cross-border interconnections, selection of transmission technologies, preparation of Detailed Project Reports, and modes of investment for timely implementation of projects,” adds the statement.
Nepal and India had previously agreed to hold negotiations on power trade agreement on July 21-22 in New Delhi. However, the meeting could not take place as the draft agreement forwarded by India around that time had raised some eyebrows here, with many politicians claiming the deal would give sole authority to the Indian government and companies to generate electricity here.
To settle the dispute, a panel comprising leaders of three major political parties was formed, which has finalised the draft of the power trade pact by incorporating provisions only on power trade and development of cross border transmission lines to import and export electricity, without touching on the issue of power generation.
Source : The Himalayan Times