Representatives of the Indian companies -- GMR, PES Engineers and Bhilwara Energy -- put forward their security concerns at a meeting with Energy Minister Dr Prakash Sharan Mahat on Friday. [break]
The meeting has come at a time when Indian investors in Nepal are facing increasing threats from the opposition Maoist party. The party has especially targeted the Upper Karnali and Upper Marsyangdi projects, in which GMR Consortium, a leading infrastructure development company of India, has invested.
“We are committed to a secure investment climate in Nepal for foreign investors. Unfortunately, there is a tendency among some political parties to not implement their promises.” Minister Mahat told myrepublica.com after the meeting, adding, “Work on the Upper Marsyangdi has not yet begun in spite of several rounds of talks with the Maoists.”
Dr Mahat said that there is already a political consensus on ensuring suitable security guarantees for investors and the government is committed to ensuring a secure investment climate for foreign investors in Nepal.
India has taken the security situation facing Indian investors in Nepal very seriously. During Indian External Affairs Minister SM Krishna´s Nepal visit, this issue was accorded the highest importance by the Indian side.
Although the Maoist central leadership has claimed that the party does not have any policy directed against foreign investment, much problems were caused at the local level with party activists threatening GMR to pack up and turn back.
- Upper Marshyangdi work still obstructed
- Govt to formulate Project Development Agreement
- Investors want tax relaxation
- GMR says all project work to end by 2016
The companies have also requested the government for a high-level contact with the Indian government to give them access to the Indian market. Once in Nepal, foreign investors also have limited rights just as Nepali independent power producers.
“Since there is no regulation for Indian power developers to enter their home market in India, they have requested an appropriate legal framework for entering that market,” spokesperson of the Ministry Anup Upadhyaya said.
The Ministry, in return, has promised a Project Development Agreement (PDA), which will be a model agreement, at the earliest to address the concerns of Indian investors in Nepal.
At the progress review meeting, the representatives also raised the present taxation policy of Nepal. They have sought a tax relaxation during the initial few phases of hydropower project development.
“At the meeting, the government side enquired about the shortcomings and weaknesses, as this was crucial in developing the PDA,” Upadhyaya added.
While GMR is working on the 300-MW Upper Karnali and the 600-MW Upper Marsyangdi II projects, Bhilwara Energy has investment in the 120-MW Likhutar project situated in Ramechhap and Okhaldhunga districts.
Similarly, Hyderabad-based PES Engineers has bagged the survey license for the 110-MW Phulkot Karnali power project on the Karnali River in remote Kalikot district.
GMR claimed at the review meeting that all work relating to the Upper Karnali will be completed by 2016, with the initial three years for completion of the Detail Project Report.
akanshya@myrepublica.com
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