Nepal today signed an agreement with the GMR, authorising the Indian company to build a 900 MW hydropower plant, the country's largest, that could alleviate the power crisis facing the nation.
Prime Minister Sushil Koirala, India's Home Minter Rajnath Singh, Home Minister of Nepal Bam Dev Gautam and CPN-UML chairman K P Oli were also present during the signing ceremony of the Project Development Agreement (PDA) held at Singhdurbar Secretariat in Kathmandu.
Chairman of Nepal Investment Board Radhesh Pant and Chairman of GMR Business Unit R V Sheshan inked the agreement.
The cabinet headed by Koirala yesterday endorsed the agreement prepared by the Investment Board.
Under the agreement, Nepal will get 12 per cent free electricity from the project and 27 per cent free equity share in the project.
Besides these, more than 2,000 locals will also get employment from the project.
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 sign PDA within 45 days.
GMR has been given two years period for financial closure under the agreement.
The project will be complete in five years after the financial closure and it will start generating electricity from 2021.
The total cost of the project is estimated to be USD 1.5 billion, the largest-ever foreign investment coming to Nepal.
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 faces severe power shortage, with major cities remain under power cuts for up to 12 hours.
