Nepal has endorsed the Power Trade Agreement with India and signed a deal with the GMR authorising the Indian company to build the largest hydropower project worth USD 1.15 billion in the energy-starved nation.
Nepal government today signed the Project Development Agreement with the GMR a day after the cabinet authorised the Investment Board of Nepal to sign the much awaited deal for the development of 900 MW Upper Karnali Project.
Similarly, the cabinet yesterday also endorsed the Power Trade Agreement (PTA) signed between Nepal and India.
The two countries had reached a deal on a preliminary draft of PTA on September 4. The agreement covers, power trading, cross-border transmission lines and grid connectivity between the two neighbouring countries.The agreement paves way for final agreement of PTA with the government of India.
This has been a major breakthrough for harnessing abundant hydropower potential of Nepal which will pave way for cooperation between Nepal and India in hydropower sector. This is also likely to bring in a huge foreign investment in hydropower sector of Nepal.
During Prime Minister Narendra Modi's visit to Nepal in August, the two countries had emphasised that cooperation in this sector will be beneficial to them and officials were directed to finalise the PTA as soon as possible. Nepal faces severe power shortage, with major cities remain under power cuts for up to 12 hours.