An agreement to this extent was signed by Madhu Kumar Marasini, joint secretary at the Ministry of Finance (MoF) and Tahseen Sayed, country manager of World Bank at a function on Wednesday.[break]
Out of the total assistance agreed, $37 million is loan assistance while $2 million is grant.
The assistance is aimed at implementing the transmission line project to facilitate trade of electricity between Nepal and India so as to reduce power shortage especially during dry season in Nepal.
The IDA has already financed $99 million for the project which has under construction since 2011.
The project is expected to fulfill the requirement of high voltage 400 KV transmission line across Nepal-India border. The project components include Dhalkebar-Muzaffarpur 400 KV transmission line, Hetauda-Dhalkebar-Duhabi transmission line and sub-stations synchronization of Nepali and Indian grids.
“NIETTP is part of WB Group´s wider efforts to help Nepal ease its severe energy crisis through short, medium and longer term actions. In particular, the additional fund will allow Nepal to continue the ongoing construction of transmission line,” Sayed said.
Import of electricity through the transmission lines to be constructed under the project is expected to end energy deficit in Nepal in short term and medium term.
“In longer term, they will contribute to balancing the demand and supply, facilitate power trade and help drive economic growth in Nepal,” Sayed added.
Speaking on the occasion, Marasini said power generation alone will not solve the problem of load-shedding until necessary transmission lines are built.
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