‘This forum will be the best option for investors and other concerned agencies: Shailendra Guragaain

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    Independent Power Producers’ Association, Nepal (IPPAN) and Expo and Event Management Services are organising the Himalayan Hydro Expo, which is going to be held at Bhrikutimandap in Kathmandu from January 5 to 7, under the patronage of Nepal government, National Planning Commission, Ministry of Energy and Ministry of Environment and Population. Sabin Mishra of The Himalayan Times spoke to Shailendra Guragain, president of IPPAN, to know about the objective of the expo, and challenges and opportunities in the hydropower sector in the country, among others. Excerpts:

    As a project developer yourself, you must be aware of the multiple challenges that hydropower developers are facing in implementing their projects. How will the expo be beneficial for hydro developers?

    The main objective of the expo is to bring together technology producers and consumers of the Nepali market. Developed countries across the world have expanded their industries and production related to construction. For the fast economic growth of the country, we need to adopt new technologies.

    We can adopt the new technologies that are currently being implemented in India and China. However, both developers and designers in Nepal are yet to fully embrace the new technology. The only way to move ahead is interaction. For this, the expo will be a very good platform to bring together all the concerned parties. There will be stalls of technology developers and Nepali users will get the opportunity to interact with the developers. Most of us are doing business traditionally, but we need to apply the new technological advancements that have been developed across the world. Moreover, there will be representatives from insurance and reinsurance firms, financial sector and consulting firms in the expo to hold discussions with infrastructure developers. We hope to make power producers also realise that the feasibility of any project depends on the interest rates.

    There has been growing interest among domestic and international investors in Nepal’s hydropower sector. How will the expo facilitate them?

    The crucial part is actually not so much related to investing in hydropower sector. Private sector has developed more than 60 projects in the country, but hardly 10 are being able to distribute dividends to the investors. In this regard, hydropower firms are struggling to sustain because they were unable to adopt good engineering, financing modalities and equipment. They could not select the appropriate lender. This situation should be rectified soon.

    So, we are trying to create a good forum for all concerned parties related to hydropower development to understand the overall components like project selection, engineering, financing and others. We have invited top equipment manufacturers to discuss with Nepali developers. Hydropower is a multidisciplinary subject and we are uniting all the sectors in a single forum.

    You mentioned that feasibility of a project also depends on the lending rates. How is the increasing interest rate affecting hydropower developers?

    On the first day of the expo, we will discuss tunnel construction and the related innovative technologies. Similarly, on the second day, we will have a discussion session on financial management of hydropower projects, where we will discuss on the financial issues related to the construction of a project. Representatives from national and international financial organisations will shed light on the topic. I think we are witnessing fluctuations in the interest rates mainly due to our weak policies.

    The productive sector supports employment generation and robust production base, which in turn makes the economy vibrant. Nepal Rastra Bank and Ministry of Finance should consider this fact and make necessary amendments to the existing policies. To strengthen the government coffers, the interest rates should be competitive with neighbouring countries. Due to high interest rates, productive sector-related industries are struggling. We will hold serious discussions on this issue.

    What do you think will be the takeaway for investors from this expo?

    While this is a platform for investors to widen their knowledge, they might not get the answer to each and every query they might have related to the hydropower sector. Even so, it could get the ball rolling in terms of clarifying certain misconceptions they might have or be more in tune with the various advances made in the sector. Projects being developed by the private sector require digging of 425-kilometre tunnel within the next few years.

    This means there are multiple sectors in which the newly invented technologies can be implemented. So, this forum will be the best option for investors and other concerned agencies. This is an initiative for development of hydropower sector in the country.

    Source: The Himalayan Times