India questions viability of Butwal-Gorakhpur power line

The fate of 400kV New Butwal-Gorakhpur cross-border transmission line is hanging in balance, as India questioned the power line's commercial viability, saying whether it can help to encourage electricity generation between Nepal and India.

According to Kathmandu Post, both the countries had agreed to build the Butwal-Gorakhpur transmission line as a backup for the Muzaffarpur-Dhalkebar cross-border line for ensuring 24x7 electricity in the region and also pushing for increased cooperation in the energy sector.

Indian ambassador to Nepal Manjeev Singh Puri stated that India might not be interested in developing the Butwal-Gorakhpur power line if it is not commercially sustainable.

Addressing the second edition of Nepal Power Investment Summit here on Monday, Puri said, "The commercial viability should be the precondition for investment in the project."

Meanwhile, the statement made by Puri is in line with the joint statements made by Indian officials during the Nepal-India energy secretary-level Joint Steering Committee (JSC) meeting, according to the Ministry of Energy officials.

During the last JSC meeting in February, both countries had agreed to finalise the detailed project report of the power line prepared by a joint technical team and had asked for recommending a funding modality to build the power line.

Nepal had even proposed that both the countries should use their own financial resources to build the transmission line in their respective territories.

Around 20 km of the 135 km transmission line falls in Nepal, whereas the remaining part of the land is located in India.

However, India did not present or accept any proposal and repeatedly questioned the commercial viability of the project, casting doubts on the construction of the power line.

The Nepalese Energy Ministry has prioritised the construction of Butwal-Gorakhpur transmission line, as it can efficiently distribute imported power to cities like Bhairahawa, Butwal, Pokhara and Narayangadh.

It can also be used to evacuate surplus energy produced in Budhi Gandaki, Marshyangdi and Trishuli corridors, which houses the majority of Nepal's major hydropower projects.

Nepal has already arranged funds to develop the power line that falls within their area.

It is planning to build the transmission line, by using grants provided by the Millennium Challenge Corporation (MCC), an independent US government agency. Also, an agreement for this has been signed between the two sides.