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Indian firm seeks 3 bn for Kathmandu-Tarai expressway

Gorkha Post



KATHMANDU — Indian firm Infrastructure Leasing and Financial Services (IL&FS) has submitted a bill worth Rs3.17 billion spent for preparing a detailed project report (DPR) for the Kathmandu-Tarai Expressway in 2015.

The Indian consultant on Sunday, asked the Ministry of Physical Infrastructure and Transport to make payment for the costs incurred as the Nepal Army, the project developer refused to purchase the DPR, the Kathmandu Post reported.

According to report, Nepali Joint Secretary Ram Hari Pokhrel, said the letter from the Indian company has put us in a fix. He said they will have to go through the memorandum of understanding (MoU) signed with the Indian company.

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In July 2015, the Indian consortium had  submitted a report to the ministry regarding the construction of 76-km expressway connecting Kathmandu with the southern plains.

The then Sushil Koirala-led government was preparing to award the project to the Indian consortium. It was decided that an annual minimum revenue guarantee of Rs15 billion would be provided if the road toll failed to generate adequate profits.

The government had to scrap all the agreements reached because of this controversy and decided to construct it with domestic resources.

On May 4, 2017, the project’s responsibility was handed over to the army with the authority to purchase the DPR from the Indian company.

The Nepal Army, however, decided against purchasing the DPR saying that it was incomplete.

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Govt decides to award Budhi Gandaki Hydel project to Chinese firm again

Gorkha Post



KATHMANDU — The government has decided to award contract for the construction of the 1,200-megawatt Budhigandaki hydropower project, a national pride project, to China Gezhouba Group Corporation (CGGC) once again.

A Cabinet meeting on Friday has decided to award the contract for the project to CGGCL reverting the erstwhile Sher Bahadur Deuba government’s decision to develop the 1200MW project with internal resources.

The Cabinet meeting has directed the Energy Ministry to initiate the process to award the project to the Chinese company.

Following the government decision, the Energy Ministry will now invite the Chinese company for talks and prepare a draft of the memorandum of understanding (MoU) before signing it, according to multiple sources at the ministry.

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As per the Cabinet decision, the ministry has been asked to hold talks with the Gezhouba, prepare a proposal, and strike a deal to execute the $2.5 billion reservoir project.

Earlier on May 15, 2017, the Pushpa Kamal Dahal-led government had awarded the contract to construct the Budhigandaki project to CGGCL, juat nine days before he was to resign from the PM’s post.

The Dahal-led government had awarded the contract to CGGCL at a cost of Rs 260 billion as per a study carried out by a French company, Tractebel Engineering.

The agreement, however, invited controversy as the project was handed to the Chinese company without initiating a competitive bidding process.

The Budhi Gandaki hydel project has been touted as a key project to resolve the perennial power crisis in the country. The government has allocated Rs18 billion for compensation payments and operational expenses for this fiscal year.

The Gorkha and Dhading district administration offices are currently distributing compensation to owners of the land taken over by the project.

More than 8,000 households will be affected by the project, according to the latest report.

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