By PRABAL ADHIKARI
Upper Karnali Project
Upper Karnali is a tributary of the Karnali River in the Far Western Development Region of Nepal. A project is going to be developed in this tributary by the Indian conglomerate GMR on BOOT (Build, Own, Operate and Transfer) basis, and the energy generated from it will be exported to India. As per an understanding reached earlier, a small quantum of it is to be supplied to Nepal free of cost.
Had Nepal developed this attractive project on its own for domestic consumption, it would have been a feather in Nepal’s cap. But the Government of Nepal has already awarded it to a foreign private sector through international competitive bidding (ICB), and the project is to be implemented soon.
In this context, it is wise for us to be concerned about how effective the implementation is going to be. If the project is deliberately obstructed, it will drive our country into an unpleasant situation. Our dream of prosperity through hydropower development could turn into a mirage.
A World Bank aided pre-feasibility report on Upper Karnali revealed the prospect of a 4180 MW storage project that would take advantage of its big loop formation. However, that turned out to be the “Road Not Taken”.
Such a project was bound to face criticism from some circles in connection with its capacity loss. In fact, though the concept appeared attractive up front, there were many reasons to put it aside, the most important of which was practicability.
Obviously, Nepal was not able to fund such a huge project. Instead of shelving it for the unknown future, the best option was to develop it in a sustainable way. Meanwhile, our rivers cannot wait until they start suffering from impacts of global climate change that might diminish their flow and expected benefits. It was decided that Upper Karnali will be developed as a 900 MW run-of-river project.
The GMR consortium was awarded the project through ICB after the rigorous evaluation process, all rumor about it are simply the consequences of our internal conflicts regarding the use of our water resources. Such rumors are invariably louder when India is involved, because our past river-based treaties with India have created controversies regarding our national interests. Worse still, India’s recalcitrance in various matters has inflamed the situation in the case of Upper Karnali. And this despite the fact that Nepal and India have enjoyed a deep friendship since time immemorial.
Some individuals had filed a petition over Upper Karnali, and the Supreme Court and consequently issued a stay order over the project. The order had pushed the project to uncertainty and left developers at odds. But the Supreme Court has now scrapped its earlier stay order, clearing the way for the project development agreement (PDA) to be signed between GMR and the Investment Board Nepal (IBN). The petitioners had failed to give convincing evidence of their claims.
A wave of opposition and protests from some disgruntled parties had provoked the developer to quit the project and exit from Nepal. However, the judicial go-ahead has dismissed apprehensions over the development of the project.
Yet, it is essential to continue the developer’s consultations with the government and local people to establish mutual trust and explore ways to respect the indigenous people’s rights and concerns. Meanwhile, the role of the Nepali Government is crucial to ensure that the law is implemented and all property as well as individuals involved are protected from threats during the construction.
While potential options for the local people’s benefits still have room for negotiation with the concerned developer, both the government and the developer can go ahead with their own programs, honoring people’s rights in all honesty.
The lapses of security in the construction site of the project may have given the Indian administration a chance to station its own security personnel as in Koshi and Gandak barrages in the past. If we were not concerned about this possibility, we would have created the time and space for India to intervene in the process. However, this alarm looming over our country has been deflected by Nepali government’s admirably far-sighted decision to mobilize the Nepali armed security personnel at the construction site.
The immense water resources available in the country have not only given us opportunities, but also posed potential threats to the sovereignty of the country in case of our failure to handle it carefully. Our political leaders should know enough about it and spare some moments for Indo-Nepal river-based relations. To ensure transparency, fairness and celebratory friendship in our mutual effort towards harnessing our watercourses, it would help to know how differences would be handled.
Large hydropower projects which are licensed to foreign developers naturally draw regional and global concerns in many ways, since the present world is keen to keep an eye on the utilization of natural resources in any part of the world. Security threat from internal elements not only destroys the project, but also causes unintended distortions in bilateral and multilateral relations, eroding future prospects of collaboration and cooperation.
It is high time Nepal assured India and the Indian conglomerate GMR that there will be no clashes of the kind that had occurred in the past with the sole intention of obstructing the Upper Karnali project.
The MoU signed with the GMR-led consortium in 2008 has established the provision for 12 percent free energy and 27 percent free equity for Nepal. In addition to it, the royalty it will pay to the government of Nepal from exporting electricity can revive our gloomy economy.
With differences worked out regarding most principal issues, the project is just a few steps away from a PDA. The PDA led by IBN is expected to be historic in the sense that it will open new avenues for development of large hydropower projects in Nepal. It is hoped that the imminent PDA will neither surrender Nepal’s national interests, nor benefit India at the cost of employment and environmental advantages for Nepal. At the same time, IBN should be cautious in negotiating specific circumstances in addition to the contents of the new PDA template developed in conjunction with international advisors. The PDA should be accountable to the nation and the people, including the protection of the enormous potential of hydropower at the Karnali basin.
Along with the hopes, Upper Karnali has brought fears, waiting to be analyzed and allayed. But the burning question doing the rounds now is: If GMR procrastinates on Upper Karnali, will it fuel uncertainty in Nepal’s hydropower sector, specially with reference to India?
The author is a senior Engineer
Source : Republica