Hariram Koirala, secretary at the Ministry of Energy, said that the two sides agreed to hold next round of bilateral talks and sign a formal agreement in Kathmandu soon. According to him, the talks in Beijing this week was part of an effort to lay the groundwork for Kathmandu meeting. [break]
The Koirala-led Nepali delegation had reached Beijing on Wednesday and held talks with the representatives from the main investor of the project, China Three Gorges Corporation, China Development Bank and the Exim Bank for three days.
Prime Minister´s Economic Advisor Rameshware Khanal and Chief Executive Officer at the Investment Board Radhesh Pant were included in the Nepali team. They held separate talks with Cao Guang Jing, Board Chairman of the China Three Gorges Corporation, and the company´s President Chen Fei. The Nepali team also held separate talks with officials from the two banks.
"We have reached an agreement in principle to activate the understanding on West Set project. They [officials from the Three Gorges] have good expectations from the project," Koirala told Republica on Friday evening. According to him, the two sides reached understanding on two major issues. "This time, officials from the Three Gorges have agreed in principle to synchronize the component of building transmission line with the entire project and the Chinese Exim Bank has become positive toward providing soft loan to Nepal," he said.
The Ministry of Energy (MOE) and China Three Gorges Corporation signed a Memorandum of Understanding (MoU) about five months ago to construct 750 MW West Seti Project in a Private Public Partnership model. This time the China Three Gorges Corporation invited the Nepali side to Beijing with a plan to discuss the project in detail.
The China Three Gorges is making 75 percent investment in the West-Seti project in which the total investment is estimated around 1.2 trillion rupees. The Nepal Electricity Authority will investment the remaining 25 percent.
Following the bilateral agreement, the parliament´s Committee on Natural Resources and Means had directed the government to take the project ahead through the Investment Board and hold fresh rounds of talks with the Chinese side accordingly.
Koirala said the talks were held in accordance with the parliamentary committee´s suggestions to use the electricity produced by West Seti in Nepali market. They talked to Chinese side about transmitting the electricity from the Doti-based project to the national grid in Butwal.
"Producing electricity from a hydroelectric project alone is not enough. Therefore, our talks were mainly focused on transmission line and it is fruitful for us because they [Chinese side] are positive on the matter," said Koirala. "Official from the Chinese banks had talked about providing commercial loans but later they became positive on the process of soft loans after they studied a proposal from the Nepal government on the matter."
Koirala also informed that a high-level team from China will arrive in Kathmandu to hold further talks on the agreement that they reached in principle during the present visit and to finalize them in writing.
The government is mulling over taking the West Seti Project ahead through the Investment Board as the government has passed a policy of undertaking all the projects with capacity over 500 MW. Investment of China Three Gorges in the mega project has been watched keenly because this is the first big hydro project to be developed by a Chinese company in Nepal.
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