Nepal and India solidified a substantial electricity trade deal on Thursday, marking a long-term agreement whereby Nepal commits to exporting 10,000 megawatts of electricity to India over the coming decade. The official signing ceremony took place in the presence of Nepal’s Minister for Energy, Water Resources, and Irrigation, Shakti Bahadur Basnet.
Representatives from both nations, Gopal Sigdel from the Ministry of Energy, Water Resources, and Irrigation in Nepal, and Pankaj Agrawal, India’s Energy Secretary, inked the significant agreement.
The foundations of this bilateral understanding were laid during Prime Minister Pushpa Kamal Dahal’s visit to India between May 31 and June 3 the previous year. Prime Minister Narendra Modi affirmed India’s commitment to long-term electricity purchases from Nepal during the visit, leading to the consensus reflected in this agreement.
The Indian Council of Ministers has already endorsed the Memorandum of Understanding (MoU) established between the two countries, with the signing ceremony coinciding with the ongoing two-day visit of India’s External Affairs Minister, Dr. S Jaishankar.
This landmark agreement opens avenues for various government and private entities in India to engage in power trade with Nepal through short-term, medium-term, and long-term contracts. Additionally, private sectors in Nepal are granted the opportunity to participate in the import and export of electricity upon completion of necessary procedures.
In a joint statement issued during the Nepalese Prime Minister’s visit to India last year, both nations acknowledged the historic and significant nature of the power export deal. Nepal has outlined an ambitious energy development strategy, aiming to generate 28,000 MW of electricity over the next 12 years, with a specific target of exporting 15,000 MW, including to India.
Energy Minister Basnet, expressing satisfaction with the burgeoning cooperation in the energy sector, emphasized the need to bring these initiatives to fruition. He highlighted that the agreement to export 10,000 MW of electricity over the next decade would elevate the bilateral relations to unprecedented heights.
Minister Basnet urged Indian officials to expedite ongoing projects and meet stipulated timelines, expressing optimism for increased investment in large-scale projects across various sectors.