No light at end of load-shedding
Attacks on power projects bad news for Nepal’s power woes.Three office buildings belonging to GMR Energy, an Indian company involved in construction of the 900 MW Upper Karnali hydropower project in Dailekh, Accham and Surkeht districts of western Nepal were burnt down by a mob comprising around five dozen persons last Sunday.
A security guard and a survey contractor were severely beaten up while others including 11 Indians working at the project site fled to a Nepal Army camp located four kilometers away to save themselves.
Ruling Maoists and other Left organizations have been claiming that the project is not in Nepal’s interest and had vandalized a project update meeting organized by GMR last month as well. They are demanding that the company wind up its work and leave the country.
A day earlier, another mob attacked workers at the Charnawati hydropower project in Dolakha district. Four persons including two engineers and an Indian were injured in the incident.
The mob, which was demanding increased rates for transportation of construction material threatened to kill the workers and officers unless work on the project was stopped immediately.
Both incidents, seemingly unrelated, show how power projects under construction in Nepal are becoming soft targets. In the past too there have been attacks on other hydropower projects like Baramchi and Handikhola in Sindhupalchowk district.
The Maoists were quick to distance themselves from the Sunday attack on GMR’s offices. But the party’s anti-India rhetoric and action against Indian joint-ventures in Nepal including the Upper Karnali project doesn’t leave much scope for speculation on who orchestrated the incident.
During his Nepal visit last month, External Affairs Minister SM Krishna had strongly taken up this issue with Nepal government and the Maoist leadership. But apart from usual utterances about security, nothing improved.
Following last month’s attack on the project, Maoist leaders threatened GMR not to continue work on the project. A meeting with the party’s in-charge of water resources committee Lila Mani Pokhrel held in Kathmandu earlier this month didn’t yield any positive outcome.
New conditions (which are not in Nepal’s electricity policy, the bidding clause or the MoU) like renegotiation of MoU and no export of energy till Nepal becomes self sufficient were put forward by the Maoists. The party also refused to let GMR continue work on the project.
It is worth mentioning GMR started work on the project after winning a global bid and an evaluation process lasting nearly a year. The same group is also developing the 600 MW Upper Marsyangdi-II project in Lamjung and Manang districts in central Nepal.
When private sector entrepreneurs met Energy Minister Gokarna Bista demanding security, the minister condemned the attacks, agreed such incidents discourage foreign investors and repeated the government’s willingness to provide security.
Electricity or the lack of it is a big concern in Nepal. In a television interview this week Prime Minister Jhalanath Khanal termed laying the foundation stone of the 456 MW Upper Tamakoshi Hydropower Project as the biggest achievement of his short obstacle-filled tenure.
The project, largest of its kind to be constructed with entirely domestic capital (Rs 35 billion), is expected to be commissioned in 2015. Nepal hopes it will end the country’s power problems that result in 14 hour daily power cuts during winter months.
Besides inaugurating the project, Khanal has been doing other things as well. In March, a month after assuming office, he declared a four and half year ‘energy crisis’ in Nepal and launched a US $ 275 million plan to generate 2500 MW of electricity by 2015.
Despite having one of the largest hydropower potential (83,000 MW approx.), Nepal is not able to generate even half of the 900 MW peak supply demand during dry season. This has had an immense adverse impact on the country’s unstable economy.
Industrial output is decreasing, many industries are closing down, due to lack of employment avenues semi-skilled and skilled workforce is fleeing the country, cost competiveness of Nepali goods is going down and trade deficit is increasing due to rising imports.
The country needs to get its act together soon and rapid generation of electricity could provide the booster dose. Besides becoming self sufficient, Nepal can export electricity to India and China, both of which are in need of more power to fuel their development goals.
But continued attacks on power projects will affect investment and put a spanner on its ambition of becoming a power surplus nation.
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