By Sudeshna Sarkar, IANS,
Kathmandu : Nepal’s Maoists have decided not to allow any hydropower project that intends to export the generated power, a decision that immediately impacts Indian group GMR as well as nearly a dozen more potential Indian investors.
The announcement was made by Dharmendra Bastola, Maoist politburo member as well as chief of the Seti-Mahakali Bureau, the region where GMR’s office and site camp for developing the 900MW Upper Karnali hydropower project was burnt down last month.The Maoist leader said the central committee of his party decided at a meeting nearly two months ago that the licence given to GMR to conduct a survey – which is likely to be followed by a power generation licence – should be scrapped and a fresh contract should be renegotiated.
A consortium of GMR Energy Limited, GMR Infrastructure Limited and Italian-Thai Develop-ment Project received the licence in 2008 to developing the Upper Karnali, in which Nepal Electricity Authority gets 27 percent free equity and Nepal 12 percent free power. As per the understanding, the power generated would be sold to India.
However, in a move that ups the ante, the Maoists are now seeking to have the country’s best hydropower projects developed domestically with Nepal holding over 51 percent share to ensure the “sovereign right of Nepalis to their natural resources”.
The Maoists are saying the Upper Karnali contract is against Nepal’s national interests. According to Bastola, it is the cheapest hydropower project in Nepal and can generate 4100 MW.
“It will cost about NRS 2 to produce per unit of power while we are currently buying power from India at NRS 10.72 per unit,” he said. “We need NRS 300 billion to generate 4100 MW, which can be easily raised through army funds, the Employees’ Provident Fund or the annual remittance sent by Nepalis each year.”
The Maoists say that while almost 60 percent homes in Nepal haven’t seen electricty, it is an act of “selling out” to export power. Also, with Nepal to be restructured into federal states, the allocation of hydropowers should be put off till the states have been formed and their governments consented.
With Nepal’s cabinet this week deciding that the army would be deployed at the GMR work site in remote Dailekh district to ensure security for the Indian investor, Bastola said the army would not be able to protect the project as the people of the area would rise up against it. “We are asking the government to develop it on its own or if needed, on a public-private-cooperative partnership in which GMR or other big investors could also participate,” Bastola said. “However, the power generated has to be for Nepal. ”
When then happens, the Maoist leader said his party would guarantee the security and profit of the foreign investor.
However, now, he said Maoist ministers would ask the government to scrap GMR’s licence and the campaign would be taken up by Maoist MPs in parliament. “If this fails, people will get ready from the streets to build Upper Karnali,” Bastola said.
The Upper Karnali project could develop into a bone of contention between the Maoists, who are now the largest party in the ruling alliance, and Prime Minister Jhala Nath Khanal’s communist party.The current Energy Minister, Gokarna Bista, is from the PM’s party and has assured GMR of security.
The Upper Karnali issue was also strongly raised by Indian External Affairs Minister S M Krishna during his visit to Nepal in April, when GMR’s public hearing was attacked and disrupted by the Maoists.
(Sudeshna Sarkar can be contacted at [email protected])