A board meeting of IBN in the last week of May had decided to seek an explanation from the Chinese company asking why the work is not progressing according to the agreement and action plan made by Power China to make the project together with the Nepali company HIDCL.
HIDCL and Power China signed an initial agreement to develop the Tamor Project during Chinese President Xi Jinping’s visit to Nepal in 2019. Of late, HIDCL found it difficult to sell electricity in the Indian market while constructing the project in collaboration with a Chinese company, and it sent a proposal to the IBN to cancel the agreement. As per the MoU, the detailed project report (DPR) was supposed to be prepared within two years and take the project into the construction stage. However, even after three years, neither the joint venture company was established nor any work was done to advance the project. According to IBN sources, the government decided to give one month’s time to the Chinese company so that no legal dispute would arise later. IBN showcased the Tamor Project during the Nepal Investment Summit 2019 and received six proposals from various consortiums—two from China and one each from Qatar, America, Singapore, and Hong Kong for the development of the project. Out of them, two consortiums of investors were shortlisted to present a detailed proposal. The consortium of Power China and HIDCL was selected after the evaluation of their proposal. The project is located on Lambhu Khola of the Tamor River between the Tehrathum and Panchthar districts in Koshi Province. Interestingly, India’s state-owned Satluj Jal Vidyut Nigam (SJVN) has shown interest in developing the Tamor Reservoir Project and has sought permission from the government. The SJVN has recently signed a project development agreement (PDA) with the IBN for the construction of the 669 MW Lower Arun hydropower project. This is the second mega project undertaken by the SJVN after the $1.04bn 900-MW Arun-III hydroelectric project in the Arun River.
