Monday, September 25, 2017

Parliamentarians instruct government to construct Budhi Gandaki by itself

Instructing the government to halt the process of allowing China Gezhouba Group Corporation (CGGC) to develop Budhi Gandaki Hydropower Project, the Parliamentarians have asked to construct by itself.
Nearly four months after the government signed a contract agreement for the hydel project with the CGGC, a joint meeting of Agriculture and Water Resources Committee (AWRC) and Finance Committee – under the Legislature Parliament – today has instructed the government to to scrap the Memorandum of Understanding (MoU) to award the 1,200-MW Budhi Gandaki Hydropower Project to the Chinese government undertaking . The MoU was signed in May.
The 1,200-MW project was recently listed as a component of the Belt and Road Initiative (BRI), the China-led plan that envisages greater trade and connectivity and supports varied infrastructure projects.
"The meeting has decided to order the government to scrap the MoU and all the processes of awarding the hydropower project to the Chinese developer and develop it by mobilising internal resources,” chairperson of the Agriculture and Water Resources Committee Mohan Prasad Baral said, adding that the national pride project should be built by mobilising domestic capital and capacity instead of handing it over to a foreign company.
The lawmakers, on the occasion, also flayed the government saying that the project was handed over to the CGGC against the country’s legal premises and breaches the Public Procurement Act. The government has also been criticised for not holding free competition before deciding on the company to undertake the hydroelectricity project.
"This project was handed over to a controversial Chinese company whose track record is so bad in Nepal by flouting various laws like Public Procurement Act," chairperson of the Finance Committee Prakash Jwala said, adding that the government made a blunder by awarding the project to the Chinese firm. "The intention behind selecting this Chinese firm is only to hold the project."
Budhi Gandaki – a reservoir-type mega project that lies in Gorkha and Dhading districts – has been highlighted as a key project to resolve the country’s perennial power crisis.
Kulekhani hydropower projects 1 and 2 – the only reservoir type hydropower plants in the country – having combined capacity of 92 MW are capable of offsetting supply shortage during dry season.
The government-led by Pushpa Kamal Dahal, on May 23, had in principal decided to entrust the work of building the mega project to the CGGC under the engineering, procurement, construction and finance (EPCF) model, though the government led by KP Oli had already completed the home work to award the project to the Chinese developer.
Following the cabinet decision, the then energy minister Janardan Sharma had signed the MoU with president of CGGC Lv Zexiang on June 4 in the presence of then PM Pushpa Kamal Dahal and Chinese ambassador to Nepal Yu Hong. The MoU, however, is silent about project cost. According to the project's DPR prepared by a French consultant, the project is estimated to cost Rs 261 billion.
State Minister for Energy Shambhu Lal Shrestha, on the occasion replying the House committee, said that the country can construct the project with domestic resources.
Though the parliamentary panels have directed the government to scrap the project, they want continuation of land compensation payment. The committees have suggested providing the displaced people a share in the project instead of compensation, for easing the process. The government has listed it as a national pride project. The government has allocated Rs 5.33 billion for project development this fiscal year.

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