China vies with India for Nepal power project

KATHMANDU - Three Indian companies and an Indian joint venture are vying with three Chinese companies for a hydropower project in Nepal, underscoring the two giant neighbours’ growing interest, presence and eventual rivalry in Nepal’s energy industry.

Larsen and Toubro, and Mumbai’s Jyoti Structures Ltd and KEC International Ltd are the three Indian companies that have been shortlisted from nearly a dozen for turnkey operations including laying transmission lines and building a substation for the 456 MW Upper Tamakoshi Hydroelectric Project, Nepal’s biggest hydel project being built with domestic funding.

To be built on the Tamakoshi river in Dolakha district in northern Nepal, the project is being developed by Upper Tamakoshi Hydropower Ltd (UTHL), a subsidiary of the state-run Nepal Electricity Authority (NEA).

The Indian joint venture in the fray is partnered by Spain’s Cobras Instalaciones Y Servicios and the New Delhi-based Aravali Infrapower Ltd.

The increasing Chinese presence in Nepal’s infrastructure industry - ranging from hydropower projects to hotels and housing - is borne out by the three pre-qualified Chinese companies: Sinohydro Corporation, Central China Power Grid International Economic and Trade Company, and Shanghai Electric Power Transmission and Distribution Engineering.

Upper Tamakoshi, with an estimated cost of over NRS 35 billion, is being funded by NEA, UTHL and Nepal’s Employees’ Provident Fund, that is providing a long-term loan of NRS 10 billion.

Sinohydro has an edge over its competitors, having already been awarded the contract for the main civil construction work. This entails building a tunnel, dam and powerhouse.

The project is expected to be completed by 2015.

(Sudeshna Sarkar can be contacted at sudeshna.s@ians.in)