“The reality of suggestions and activities being extended by its staffs and consultants in its Kathmandu office against Nepal’s interest and development is clarified through its West Seti policy.”   Download his article from Kantipur

It has almost been one and half decade since we hear the talks on implementation of West Seti (reservoir-based 750 MW) which is hoped to change the fate of Far Western Development Region. Taking into consideration the huge investment in needs, around US$ 1.6 billion, delay in financial management was taken as normal. The hopes had heightened after the multilateral development partner Asian Development Bank (ADB) showed the interest to invest in West Seti. Besides its own investment, the ADB had instigated Government of Nepal (GoN) for investment in West Seti through commercial loan. The bank has already signed agreement for 15 percent investment in the project. 

The tenure of this agreement has expired. The bank has neither renewed it nor has it announced to withdraw. It has also extended US$ 45 million loan to GoN for 15 percent investment in the project. The bank has involved the government through loan with high interest. Investment by the government was expected to deliver positive thoughts among the investors and create a cleaner image in international market for investment in Nepal’s hydropower.

The ADB’s entry into West Seti has created additional confusions. The involvement of ADB has put the project in dilemma. In totality, the bank has not only stopped one project but influenced country’s economic growth. ABD has neither made investment nor has it said it will not. Rather it is busy making a new agreement. It was under ABD pressure that intolerable provisions such as ‘all compensation to be made for loss caused by construction of the project (WSH) has to be made by Nepal government’ are being incorporated into the new draft agreement. There won’t be any agreement under such provisions. Failing to sign the agreement means project’s construction will not continue. At this hour, ADB has remained silent saying agreement has not been signed. As a result, it has stopped probable international investors of West Seti. In this way, the project nation was awaiting for the last one and half decade is set nowhere due to ill intention and policies of development partner such as ADB.

It should have opened ways for other investors if it can’t invest. This has exposed the bureaucracy of the ADB. The reality of suggestions and activities being extended by its staffs and consultants in its Kathmandu office against Nepal’s interest and development is clarified through its West Seti policy. What development progress has ADB expected to make through such a group of staffs? For example, when Shallow Tube-wells project reached its final stage for implementation with government grants, it had put pressure on government to stop the grant. Agricultural Development Bank used to distribute 4000 such Tube-wells annually. ABD showed its character by hindering national policy when the grant stopped. The mission had aimed at minimizing poverty through irrigation facilities to the marginalized farmers. The ADB staffs have good role in building such a character.

West Seti is exactly facing the fate of Shallow Tube-wells. ABD has compelled the government to invest while it remained as an element of indecision. Other donors gave little attention when they saw ADB’s involvement. Whether ABD makes investments or not, it is a matter of reality that it has lingered a lot of Nepal’s time in West Seti. More delay in construction of the West Seti means greater loss for GoN and the people of the Far West. Not only that Nepal is losing royalty and free electricity, but thoughts of the general public for local development and economic prosperity by initiating West Seti have turned out to be just the dreams. The government has not been able to tell anything to ADB because it has provided US$ 45 million as loan. Debts always keep one dominated. ABD, which is leaving West Seti in chaos, is engaging for Upper Seti (127 MW). If ABD gives assurances of investment in Upper Seti for next four-five years without actually making, who will be responsible? What is the view of ABD headquarters regarding hydropower development in Nepal? ADB’s involvement in eighth rural electrification as well was controversial.  ABD has added poverty to poor people by hiring expensive consultants in road connectivity project.

It is to be seen how many hours of load shedding will ABD add when it moves from West Seti to Upper Seti. The results of government officials dreaming to be hired as consultants in ABD as assured by its junior staffs are gradually coming out. If not, why the government is not ready to put pressure on ADB to correct its faulty stand? The loan should be accepted in the interest of Nepal and Nepalese, not in the interest of ADB. Unless intention to compel to accept any conditions, even if they are not in nation’s interest, on pretext of giving money, changes, the loans provided by such multilateral development partners would not alleviate poverty but eradicate the poors.

(Unofficial translation from its Nepali version published in Kantipur daily , Monday, October 26, 2009)

Hindu: The Indian side says the Maoists send mixed signals. When you came to Delhi, you spoke of 10,000 MW joint hydroelectric projects, an East-West railway. But at the Kharipati party convention in December, existing projects like Arun-III were called a manifestation of “Indian expansionism.”

Prachanda: There is no confusion. I don’t know what kinds of documents India received from Kharipati. There was serious discussion and debate on different issues and it is possible someone has seen different documents and taken them to be the final ones. If there are such references, in my assessment that was not the final document. There are different documents and maybe some tendency inside the party [to look at things that way] but in the final document a more pragmatic conclusion is there. I stand by my position that the east-west railway is very important for us, and without India it cannot be fulfilled. I have talked about the Chisapani project. I am in favour of having those kinds of megaprojects with India’s cooperation, although in some issues, like Pancheshwar on the Mahakali, there is serious confusion among the masses here. Unless we clear this, it is difficult to go ahead there. But on Karnali, there is no problem from our side.

The Hindu, May 12, 2009

A source close to Water and Energy Users’ Federation Nepal (WAFED), which has been raising the issues of high dam projects and environment degradation due to such projects in Nepal, disclosed the fact that the latter is working for a demonstration against 750 MW West Seti Hydroelectric Project in the 42nd Annual Meeting of the Board of Governors of the Asian Development Bank (ADB), which will be held in Nusa Dua, Bali, Indonesia from 2 to 5 May 2009. For the purpose, some visual documents have also been prepared where some youths can be viewed chanting slogans with English placards in rural Nepal.

The most important international economic and development gathering in Indonesia in 2009, the ADB Annual Meeting will bring together more than 3,000 people from across the globe. As per the information posted on the official site of ADB, the annual meetings are statutory occasions for governors of ADB members to provide guidance on administrative, financial, and operational directions. Additionally, the meetings provide opportunities for member governments to interact with ADB staff, non-government organizations (NGOs), media, and representatives of observer countries, international organizations, academe and the private sector.

Delegation

WAFED’s campaign coordinator Ratan Bhandari is leading the Nepali delegation that includes Deependra Bista from Dadeldhura, Bheem Bhandari from Bajhang and Raj Kumar Lekhi from Terai. As per the coverage from the Far West dallies last month, Ratan Bhandari and Bheem Bhandari played a crucial role in organizing a demonstration at Deura of Bajhang district when a special ADB mission was in the site for fact finding on West Seti. Those dailies reported that Bheem, who is a Maoist district level leader and said to be under special observation from his own party, was seen in the demonstration where the mob chanted slogans against ADB and West Seti. While Bista, a permanent resident of Dadeldhura, who claims he to be a journalist, is in close allies with the Maoists but he is not involved in any media organization so far.

The next high-profiled delegate Lekhi is a Tharu leader from Terai. Since a few years, Tharu have been opposing the group relocation of people from the West Seti affected areas to Kailali and Kanchapur. The Lekhi’s involvement in the Ratan’s campaign will disrespect the sentiments of whole Tharu populace. In the past, several Tharu leaders spoke formally that their community is just against group relocation from the Hills to Terai but they want West Seti for the development of Far Western Nepal.

So, this is a sad story of misusing the dignified personality for the sake of opposing ADB’s involvement in Nepal and for the sake of money to run WAFED to ruin the national development. Not only Lekhi, other potential leaders from Far West like Shankar Khadka, LB Rawal and Dharmendra Bastola have been misused for making propaganda by the Kathmandu-based NGO.

The WAFED source said that the event is of great importance for several organization to which the former is affiliated. WAFED is either a member of or funded by several organizations like Himalayan & Peninsular Hydro-Ecological Network, World Commission on Dams, Narmada Bachao Andolan, International Rivers Network, NGO Forum on ADB, Both Ends of The Netherland and Japan Center for a Sustainable Environment and Society.

 The NGO Forum on ADB stated that Forum has been active during the Annual Governors’ Meeting (AGM) of the ADB. “During the AGM, the Board of Governors, who are representing ADB’s member countries, make important decisions that set the direction of the Bank in terms of its policies and programmes”, reads the forum’s website. According to the website, the NGO Forum on ADB is a network of civil society organizations that has been monitoring the projects, programs and policies of the ADB since 1992.

The interesting fact regarding this forum is that it neither accepts money from the ADB nor is it in any way part of it. More precisely, it’s a group of civil society organizations that are active enough to oppose the ADB’s investments in major energy projects.

Visa

Launching the official host country-site of the AGM, Sri Mulyani Indrawati, Minister of Finance Republic of Indonesia said, “The 2009 Annual Meeting will provide an important opportunity to ADB’s 67 members and representatives of the business, academic, non-government and private sectors to discuss far-reaching global issues.”  She said that together with ADB’s management, all Indonesians are determined to ensure the gathering delivers meaningful conclusions. For fulfilling the goal of ADB- reduction of poverty in Asia and the Pacific-the AGM will certainly be a pioneer for making important decisions regarding the development of several member states.

When the Maoists-headed government is vowing generation of 10,000 MW of hydropower power in the next 10 years, certainly opposing West Seti is not a logical step in terms of developing Nepal. It is another laughter that few Maoists, including Bhandari brothers, would be standing outside the AGM venue opposing the power project with direct foreign investment, while Maoist ideologue Finance Minister Dr. Baburam Bhattarai would be yelling for the support from the global financial community. Is not a shame for the nation? People in the venue must pay mercy for the stupidity to those people who are making hue and cry against the national development.

If this project is not as per the interest of Nepal and the Nepali citizens, the government should come forward to say strong ‘No’ to West Seti. But, sending such a negative-mission-delegation to Bali for the sake of opposing West Seti can never be a good deal between the Government of Nepal (GoN) and ADB. If not in high dam hydropower projects, ADB can support development of Nepal in various sectors like health, water, education and poverty reduction. So, the responsible ministry of GoN, as well as, Indonesian Embassy in Kathmandu should check visa permit to this delegation, which will bring back the negative impression in Nepal.

(The writer is the Editor of Hydronepal.org, and can be commented at editor@hydronepal.org)

 Note: The article is reproduced from The Rising Nepal, April 30, Thursday

Nepal Rastra Bank Governor Deependra Bahadur Kshetry has said that private sector banks in Nepal have no capacity to invest in big hydropower projects.

He said that the private banks don´t have adequate money for long-term investments in such projects. “Currently, the total deposit in commercial banks in our market is worth Rs. 547 billion. That amount is not enough for investing in big hydropower projects,” the central bank governor said during the Fourth International Hydro Power Convention held in Kathmandu on Sunday.

Under the Priority Sector Lending program, commercial banks are providing loans for investors who invest in small hydropower projects with generation capacities of up to 50 kilowatts. But according to Kshetry, commercial banks are not interested in providing loans for big projects.

Last a year, a consortium of private commercial banks led by Himalayan Bank Limited reached an agreement with Nepal Electricity Authority (NEA) to invest Rs. 6 billion for the 309 MW Upper Tamakoshi Hydropower Project. That is the biggest investment made by Nepali commercial banks in the hydropower development sector.

Uttar Kumar Shrestha, executive director of NEA, urged the government to provide its guarantee for the mobilization of investment in big projects through energy bonds and debentures.

Sandip Shah, president of the Independent Power Producers´ Association Nepal, urged the government to clear legal hindrances for investors. He said that the government should exempt all types of taxes for investments in the hydropower sector for at least the next 10 years.

Indian Ambassador to Nepal Rakesh Sood underscored the need for strong commitment towards hydropower development from the political leadership. He said that there needed to be support for investors at the local levels and called for adequate infrastructural development, including the building of access roads and transmission lines at the projects sites.  

  REPUBLICA /KATHMANDU, April 26

Construction works of tunnel and powerhouse of the 14-MW Kulekhani Hydroelectricity Project III have been intensified after the project garnered support from local people and political parties.

“We have completed about 10 per cent of the total construction works of the project,” said Shyam Sundar Shrestha, chief of the project.

Located at Bhainse Village Development Committee (VDC) of Makawanpur district, the project was started in 2008.

Shrestha said that the project would be completed on time if the state mechanisms, locals, stakeholders’ committee and political parties extended their support to it.

The project aims to take water of the Kulekhani reservoir to the powerhouse after the Kulekhani I and II use the water.

In the beginning, the project had thought of taking water from the local Rapti river as well. But it has yet to decide on it.

The 2.3 billion project includes 75 per cent of shares of the Nepal Electricity Authority (NEA), while the government owns the remaining shares.

A Chinese construction company– Sino Hydro Corporation– has undertaken the project construction works.

According to Shrestha, 400-metre long tunnel has been constructed so far.

But due to abundance of underground water, the tunnel construction works of the Project II have not been going smoothly.

The project has received permission to cut down 250 out of 500 trees. “We are in the process of taking permission to fell down rest of the trees,” he said.

The NEA had wanted to develop the project to generate 45 MW of electricity, as it hoped to receive assistance from the Government of Japan. But when NEA failed to get the Japanese support, it started to work just to generate 14 MW.

The project will have completed by 2012. The project has provided 26 families of Sanutar with compensations.

 The Rising Nepal/By Ram Mani Dahal, Bhainse

radhachh@yahoo.com

There have been much discussions on West Seti Hydroelectric Project (WSHEP) not only for the hydro power development but for overall development, especially of the far western region, of the country. The debate is normal and is needed. The project is, sometimes, linked to the issue of Nepal’s nationalism in these discussions. Much is heard or read that the project is against the national interest of Nepal but less is talked on its other side. What could be the reasons behind this? Is it not the conspiracy of creating continued load shedding in Nepal and continuously oppose developing hydro power here? The issue can be debated in this line as well. In fact, this project targets to generate hydro power from the Nepali land and export 90 percent of the produced power to India, and freely distribute 10 percent (more than total capacity of mid-Marshyangdi) in Nepal.

Last week, I received additional information from materials kept at the Dhangadi and Attariya information centers of the project when I reached there during my visit to far west. It was a good attempt to provide information to local people through information centers in villages. It looks a new initiative in the Nepalese context. I had seen such in few less controversial but social projects in India. I was happy to see it in Nepal’s one of the biggest and most questioned project.

The issue to be discussed here is not about information but about laws, development and politics. And it is related to the question about whether the West Seti project is against national interest. I am trying to write on it since the issue has not become inappropriate despite being talked in several occasions.

A case was filed at the Supreme Court demanding verdict against the project in a bid to stop its construction. There are people who oppose hydropower projects in Nepal and it is not abnormal to see them opposing this project as well. It would be astonishing to see that if the court had supported their demand. That is why I, like others, had been waiting for the court’s decision.

The verdict of the court stating that there is no need to stop construction of the project but require a mechanism for compensation to the local people not only erased by suspicion but also elicited hope in me to move ahead with the project. Those, who do not want this project be constructed have resumed their campaign against it and have become active again. Though it is clear that power generated from the WSHEP cannot be shared equally since the government has given the license of producing power within the Nepali territory under joint investment, they (those who oppose) have picked multiple raisons d’être to make people and the investors confused and create unnecessary pressure on the government. This does not suit (the interest) of country and the people.

Primary thing to understand is that export of electricity produced in Nepal to India is normal economic activity. Until the two countries finalize the agreement on sharing water, distribution water resources in the eyes of international laws will not be finalized. That is why it was very clear that this project needed no approval from parliament or constituent assembly. The court has made it clearer.

While talking about (international) laws, suspicion is being raised if India could get first hand right in use of water resources due to this project. However, it is the lack of adequate knowledge on laws related to water resources to assume that a certain country gets first hand right in context of use of water resources. It is clear that efforts of the Non-Governmental Organizations to make the people confuse and present themselves as intellectual is motivated by the notion of protecting their earning source rather than working for the benefit of we the people or the country.

In fact, countries through which river flows get equal rights on water. It does not mean one can demarcate area in water of having his or her rights. The countries through which river flows must consider several issues like its current use, people dependence on that river, future impacts, economic and geographical situation, advantageous use of water resources and such other alternatives.

It is obvious that the project would not control the amount of water flowing into India or retain rights on the flowing water. There is no justifiable logic as well to accept that India has rights on water presently flowing through West Seti. So it is necessary to identify the anti-national elements who advocate, in bid to receive benefits from India, that Nepal must seek rights from India while constructing projects with reservoirs. It has become important task for us to bust the ring of those who prepare project just to oppose the other projects and we must present this as an example to the world community.  To end, all those affected by the project, government, investors, those whose politics rests on the projects and those running NOGs should be aware, in time, from the elements who try to push the society into darkness.

(A permanent resident of Achham, Khadayat is pursuing her master’s degree from Kathmandu)

Editor : The write-up has been translated from the original document in Nepali which appeared in the Kailali Hotline daily of Jan 24.

Kathmandu, December 2: 750 MW West Seti Hydroelectric Project (WSHEP), the largest storage type in Nepal, said it has applied to the government for extending time for financial closure.

The Director of West Seti Hydro Limited, Himalayan Bahadur Pande reported  that the company has asked the authority to provide at least one year to make financial arrangement.

According to Pande Asian Development Bank, which holds 15 percent share in the project, recommended West Seti Hydro, the developer of WSHEP to seek the extension.

Earlier this August, the shareholders’ meet in Kathmandu decided to ground-off the project after Tihar.
When installed, the storage plant will offer 75 MW of electricity to Nepal free of cost.

BY THIRA L BHUSAL

KATHMANDU, Sept 27 - The government has taken the 750-MW West Seti Hydroelectric Project (WSHP) as a test case for its ability of achieving the target of generating 10,000 MW of hydro-electricity in the next 10 years.
If the West Seti project fails, the government’s policy of speeding up hydro-electricity generation and attaining the set target will be in trouble, Secretary at the Ministry of Water Resources (MoWR) Shankar Koirala said at an interaction on WSHP, Friday.

The government of Nepal and West Seti Hydro Limited signed the initial agreement on the project in 1994 but the project has been delayed because of the conflict and political uncertainty in the country. The final agreement before construction work begins is expected to be signed early in 2009. The government and the Asian Development Bank (ADB) are negotiating some clauses of the final agreement.

Finance Minister Dr Baburam Bhattarai, while presenting the annual budget on September 20, set out a target of producing 10,000 MW of hydro-electricity in next 10 years.

Minister for Water Resources Bishnu Poudel has affirmed the government’s commitment to the project. “The government will not back out from the project,” he said.

“Backtracking from the project would be a serious matter because it has already taken embryonic shape and we do not want to abort it,” Poudel said.

SMEC Developments Pvt Ltd, a member of the SMEC Group of Australia, is the promoter of the $1.6 billion project and has a 26 percent share in it. The Nepal government has a 15 percent share, to be financed with a loan from the ADB. Chinese and Indian companies will have 15 percent share each and the remaining 14 percent will be owned by Nepali investors including locals at the project site.

Ninety percent of the 750 MW generated will be sold to India while Nepal will get the remaining 10 percent free of cost.

At the interaction between critics of the project and promoters on Friday locals from the affected area complained against ‘promoter apathy’, the lack of transparency and of people’s participation in the decision making process.

MoWR Secretary Koirala suggested the promoters ensure local participation in the decision making and other activities as far as possible.

People from several VDCs in Doti, Dadeldhura, Baitadi and Bajhang districts in the Far-Western Region will be affected by the project reservoir.

The SMEC has said it plans to rehabilitate about 1,383 affected families from the proposed reservoir area in the Terai. Around 186 families living in the vicinity of the proposed power house and transmission line need to be relocated. The promoters have said they will adopt internationally accepted practices for the rehabilitation.

Over 3,400 people will get employment for the five and half years of the construction period and at least 200 people will have permanent jobs during the project’s operation.

Critics of the deal have also criticised the government for awarding the project with less benefit accruing to Nepal in comparison with the 402-MW Arun-III and 300-MW Upper Karnali where promoters agreed to provide 22 and 12 percent free electricity respectively to Nepal.

“We should not think of it in the present context because this agreement signed in 1997 when we had had no benchmark to follow,” Koirala said. “It was an important achievement at the time.”

Review needed: Secretary
Secretary Koirala, however, said it was time to review the agreement in view of the changed context over the last 12 years. He said the government would give utmost priority to national, regional and local interests at the time of revision.

The project has said that a higher tariff would be set given the changed context. Earlier, it was agreed that power would be sold to India at the rate of 4.95 US cents per kilowatt-hour.

The project will be built under the build, own, operate and transfer (BOOT) model and will be handed over to the government of Nepal after 25 years of operation by SMEC. Nepal will earn over Rs 2 billion as royalty during the 25-year period, according to the promoters.

Water resource analyst Ratna Sansar Shrestha, making a presentation on the project, claimed that most of the benefits will go to India like flood control and dry season augmented flow while Nepal will face the costs of the project like restrictive use of water in upstream areas.

(लेखराज भट्ट)/ निकट भविष्यमा सुरु हुने पश्चिम सेती जलविद्युत् आयोजना यतिखेर चर्चामा छ । यो पश्चिम सेती हाइड्रो लिमिटेडले नेपालको सुदूरपश्चिम विकास क्षेत्रको सेती नदीमा बनाउन लागेको ठूलो जलाशययुक्त आयोजना हो । साढे पाँच वर्षमा सम्पन्न हुने यस आयोजनाको स्वामित्व ३० वर्षपछि नेपाल सरकारलाई हस्तान्तरण गरिनेछ ।

पश्चिम सेती परियोजनाका विषयमा पनि अन्य आयोजनामा जस्तै नाटकीय रूपमा दुई दृष्टिकोण देखा परेका छन् । पहिलोे समूह जसले आँखा चिम्लेर कमिसनका आधारमा आयोजना स्विकार्छ । अर्को समूहले नेपालमा वातावरण र राष्ट्रियताको मुद्दा चर्कार्एर सबै काम रोक्ने प्रयास गर्छ । केही राष्ट्रिय र अन्तर्राष्ट्रिय गैरसरकारी संस्थाले प्रत्यक्ष रूपमै यस्तो भूमिका खेल्ोका छन् । Continue Reading