Nepal, German sign financial accord

Finance Secretary Rajan Khanal and German Ambassador to Nepal Roland Schäfer today signed a financial cooperation agreement of Euro 24.3 million (equivalent to Rs 3.2 billion) on behalf of their respective governments. The total volume of bilateral technical and financial cooperation from Germany since cooperation began in 1959 amounts to around Euro 979.6 million of grant assistance, according to a press release issued by the German Embassy today.
The grant assistance committed by the Federal Government of Germany in September 2018 will be used for the promotion of solar energy in rural areas, improvement of mother and child care in urban areas and sustainable economic development in rural and semi-urban areas, the release reads.
Under these programmes, German Development Bank KfW, on behalf of the German Federal Ministry for Economic Cooperation and Development, is implementing promotion of solar energy in rural areas to support solar energy technologies such as solar pumping systems for drinking water and for irrigation, solar systems for public institutions like schools, health centres and government offices.
The bank is also implementing a project related to ‘improvement of mother and child care in urban areas including in Kathmandu-based Paropakar Maternity and Women’s Hospital. The project will construct and rehabilitate the extension of health facilities for up to four satellite centres. These satellite centres will provide both in-patient and out-patient services to women and children closer to their residencies.
Sustainable economic development project in rural and semi-urban areas is the continuation of earlier support to improve access to target-group oriented loans, predominantly in rural and semi-urban Nepal and in particular for loan sizes which go beyond microfinance but remain below traditional corporate finance.
Both governments expressed their commitments to ensuring a successful and timely implementation of these key projects, according to the press release.

The projects:
Improvement of Mother-Child Care in Urban Areas – Paropakar Maternity and Women’s Hospital, Kathmandu – Support in terms of construction and rehabilitation of health facilities to up to four satellite centers for
• Promotion of Solar Energy in Rural Areas – Support for Nepal’s solar energy technologies such as solar pumping systems for drinking water/irrigation, solar systems for public institutions – health centers, government offices and schools
• Sustainable Economic Development in Rural and Semi-Urban-Areas-MSME Finance/Phase 2 – Support in terms of improving access to sustainable and target-group oriented loans mainly in rural and semi-urban areas of Nepal. This support also includes loan sizes beyond microfinance but remain below traditional corporate finance.

Energy minister, EIB Veep inaugurate transmission line

Energy Minister Barsha Man Pun today inaugurated Trishuli III hydro power project at Kispang rural municipality-5 in Nuwakot
The power developed in Rasuwa and Nuwakot will be supplied to Kathmandu Valley through the 220 KV transmission line. The company has planned to complete the construction within this current fiscal year.
Nepal Electricity Authority (NEA) will invest Rs 19 million, European Investment Bank (EIB) 30 million, a German government-owned development bank (the KfW) 14 million and European Union (EU) will invest Rs 8.48 billion in the hydro project. The EU and KFW will provide technical assistance for the project, according to a press note issued by the EU Office in Kathmandu.
The power supplied through Chilime-Trishuli transmission line III B and Samudratar-Trishuli III B will be connected to this sub-station before being supplied to Kathmandu through a 40-km-long 220 KV two-way transmission line. 
The power generated through 15 different hydro power projects developed in Nuwakot and half-a-dozen on the border between Nuwkot and Rasuwa will be connected to this transmission line.
More than 7,200 households will gain first-time reliable electricity access with the construction of the new transmission link, the release read, adding that it expands access to electricity to rural communities and benefits from harnessing renewable energy.
"Once complete the new Chilime-Trishuli Transmission link allows thousands of people living in communities in the Trishuli River Basin and beyond to benefit from clean hydropower energy and a more reliable power supply," Pun said, adding that the crucial energy project is key for sustainable development in Nepal and demonstrates the close partnership between Nepal and European partners.
The new 27-km transmission line will be built through difficult mountainous terrain 50-km west of Kathmandu by the NEA and financed by the EIB, the EU through the Asian Investment Facility, German Development Bank KfW and the government.
Pun, MD of NEA Kul Man Ghising, vice president of the EIB Andrew McDowell, EU ambassador to Nepal Veronica Cody and German ambassador to Nepal Roland Schäfer, and local government and community representatives attended the ground breaking ceremony in Trishuli.
The new transmission link will enable 600MW of clean energy generated from hydropower plants, including independent power producers, on the Trishuli River corridor to be connected to Nepal’s national electricity grid and upgrade existing electricity distribution to enable a more reliable supply of energy.
“Over the coming years investment in clean energy will support sustainable development across Nepal and significantly increase use of renewable energy sources," Ghising said, adding that the Chilime-Trishuli transmission line highlights how technical and financial cooperation between the NEA and European partners benefits Nepal and helps to harness low-carbon power sources.
The distribution scheme under the transmission system will also enable households in remote rural communities to benefit from first time access to electricity and reduce the need for expensive generators and cooking fuels.
"Seeing at first hand how local communities benefit from access to electricity and how communities most vulnerable to a changing climate can benefit from clean energy makes today’s groundbreaking important for both Nepal and Europe," EIB vice president Andrew McDowell said, adding that the project demonstrates the EIB’s firm commitment to supporting climate related investment across Asia and the bank is pleased to provide EUR 30 million to finance construction of the Chilime-Trishuli transmission link.
The EU is pleased to support the Chilime-Trishuli project, ambassador and head of the EU delegation to Nepal Veronica Cody said, adding that the joint cooperation between Nepali and European partners has enabled detailed preparation to be completed and construction to formally start today.
Likewise, ambassador of the Federal Republic of German to Nepal Roland Schäfer, on the occasion, said that support for energy is a key priority for German cooperation in Nepal. "Today provides an excellent opportunity to stand alongside Nepali friends and European partners to show how together we can support sustainable development in this country," he added.
The EU and German government financed comprehensive technical assistance to totalling Euro16.25 million, essential for preparation and implementation of the project, and the EIB is providing a Euro30 million long-term loan to finance construction of the new transmission link, the press note read.

ADB, KfW scale up cofinancing partnership with additional $2 billion

The Asian Development Bank (ADB) and the German development bank KfW today agreed to scale up their existing cofinancing partnership with an additional $2 billion over the next 3 years until 2020 to continue promoting development in the Asia and Pacific region.
The Memorandum of Understanding (MoU) for cofinancing was signed by ADB vice president for Private Sector and Cofinancing Operations Diwakar Gupta and a member of KfW’s Management Committee for Europe and Asia Roland Siller, at a ceremony held at the ADB headquarters in Manila.
"The agreement today is a testament of our growing partnership with KfW and proof that development work should be a collaborative process if it is to be impactful," Gupta said, adding that the bank is optimistic that the additional $2 billion in cofinancing from KfW will help promote sustainable development in Asia and the Pacific and bring us closer to the goal of a region free of poverty.
The new agreement will build on the successful cofinancing partnership that ADB and KfW launched in 2014 for the same amount. The initial partnership (2014-2017) yielded 9 cofinanced projects focused on energy, public management, finance, education and technical and vocational education and training, and the environment in the People’s Republic of China (PRC), India, Indonesia, and Viet Nam. The $2 billion provided by KfW for these projects was complemented with $3.7 billion from ADB.
Germany is the second largest bilateral cofinancier of ADB projects after Japan. The additional cofinancing from KfW will help ADB address the region’s vast infrastructure needs, estimated at $1.7 trillion annually until 2030 including climate adaptation and mitigation costs.
The new MoU will allow the two institutions to expand cofinancing operations from five countries covered by the previous agreement to 11, including Afghanistan, Bangladesh, the PRC, India, Indonesia, Mongolia, Myanmar, Nepal, Pakistan, Sri Lanka, and Viet Nam. It will also cover new areas such as health and financial inclusion. Increasing financial resources and making greater use of high-level technology and innovative approaches are the two pillars of this partnership.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB is celebrating 50 years of development partnership in the region. It is owned by 67 members, 48 from the region. In 2016, ADB assistance totaled $31.7 billion, including $14 billion in cofinancing.

Chilime-Trisuli Transmission Line construction starts

The construction of 220 kV Chilime-Trishuli Transmission Line project has been launched officially today.
"The construction of the Chilime-Transmission Line is an important pilot contribution to the national grid," ambassador of the EU to Nepal Rensje Teerink said during the formal launch programme of construction project – of 65-million euro project (equivalent to Rs 7.67 billion) spans 27 km – in Kathmandu today.
"It will bring light and energy to homes, households and school children across the country," she added.
"Accelerated development in Nepal needs to keep clean energy as a top priority," she said, adding, "With a real sense of urgency, collective efforts should transform enormous potential into tangible reality."
"The South Asian region as a whole would benefit from the supply of clean energy, if regional cooperation projects could be put in place to harness this potential," she added.
The project is a joint undertaking of the European Union (EU), German Development Cooperation/KfW, European Investment Bank (EIB) and the government.
Energy Minister Janardan Sharma, on the occasion, said that the construction of the state of the art 220 kV double circuit transmission line is an excellent example of a strong partnership and collective efforts of Nepal government, the German Development Cooperation/KfW, the EU and the European Investment Bank (EIB).
The 220 KV Chilime-Trishuli Transmission Line project will include the construction of the 220/132 kV Trishuli 3 B Hub Substation, the construction of the 220/132 kV-Chilime Substation and the construction of the Chilime-Trishuli 220 kV double circuit Transmission Line (27 Km).
The transmission line project will be complemented by the construction of the Samundratar-Trishuli 3B Hub Transmission Line and Substation, at a cost of 270 million euros to which the EIB will contribute 95 million euros.
"In a holistic approach, the project focuses both on power generation and transmission from the Trishuli river basin,” minister Sharma said, stressing on the importance of completing the project in a timely manner for the benefit of Nepali people.
According to the press statement issued by the Delegation of the EU to Nepal, deputy chief of Mission and head of Cooperation at the German Embassy Jacqueline Groth highlighted Germany’s continued commitment to the Nepal's energy sector. Apart from its contribution to the transmission line project, German Development Cooperation will also support the upgrading of the Load Dispatch Centre in Kathmandu.
The upgrading will result in increase of supply of electricity fed into the national grid. It will reduce transmission losses and increase the reliability of the grid. As a result, the framework conditions for economic activities in Nepal will be improved especially for the industrial sector and small and medium enterprises.