+

After cancelling Chinese firm’s permit, Nepal prepares to issue global tender for key hydro project

File image: Minister for Energy Janardan Sharma (l) exchanges an agreement with the representative of Gezhouba Group for the construction of Budhigandaki Hydroelectric Project, in Kathmandu, on Sunday, June 4, 2017.

Kathmandu, May 8

Nepal’s government is preparing to issue a ‘global tender’ to seek proposals from qualified companies to construct the 1,200 MW Budhigandaki hydro project which was to be built by a Chinese company under Beijing’s OBOR scheme.

The news comes five months after the government cancelled an agreement with China’s Gezhouba Group, which was supposed to develop the project under the EPCF model. Then Energy Minister Kamal had told mediapersons in Kathmandu that the mega project will be developed by mobilising domestic resources.

Energy Minister Barsa Man Pun told reporters in Kathmandu on Tuesday that the government is planning to issue a global call for qualified companies to bid for the project. “We are not going to handover the project to any company without competition,” Pun said. He added that the contract will be awarded to the deserving company selected through competition.

The government, last year, decided to scrap the controversial agreement signed with the Chinese company citing ‘irregularly and imprudently’. China had considered the project as a part of One Belt One Road upon Nepal’s request. A joint meeting of the Finance Committee and the Agriculture and Water Resource Committee of Parliament in September had told the government to scrap the deal citing the Chinese company was not efficient for the big project. The Cabinet led by CPN-Maoist Centre Chairman Pushpa Kamal Dahal on May 23 had decided to hand over the assignment to the Chinese firm.

Accordingly, the two sides had signed the agreement on June 4. Immediately after the agreement, voices had been raised that the deal was against national interests. Former Prime Minister and Naya Shakti leader Baburam Bhattarai had led various movements demanding that the project be constructed by Nepal itself with the domestic investment.

The Chinese company had said it would construct the project in engineering procurement contract with finance (EPCF) model. According to the model, the company itself would make investments in the project, which Nepal would pay back after the construction. The detailed project report has estimated that the project would cost Rs 250 billion.

Following the cancellation of the deal, India’s state-owned NFPC had also publicly expressed interest in bidding for the project.

React to this post

Conversation

New Old Popular