G. Parthasarathy
PRIME MINISTER Narendra Modi's visit to Nepal received unusually complimentary coverage on two successive days in the New York Times, which is rarely appreciative of India's relations with its neighbours. A report headlined “Nepal enthralled by visit of Indian Premier, who hits the right notes”, noted that the normally fractious Nepalese were “unusually united in their embrace of Mr. Modi”. Mr. Modi focused attention on how cooperation on Highways, Information Technology and Transmission lines would reinvigorate the India-Nepal relationship.
Apart from the announcement of additional economic assistance of $1 billion, Mr Modi’s visit resulted in a movement forward on border demarcation and a review of the contentious India-Nepal Treaty. But what can change the dynamics of India-Nepal relations and accelerate economic progress in Nepal is the mutually beneficial utilisation of Nepal's potential for 83,000 MW hydro-electric power. Despite this, Nepal imports electricity from India. An understanding was reached during the visit of Mrs. Sushma Swaraj to expedite the construction of transmission lines so that Nepal could import additional power from India. The World Bank is also assisting Nepal in enhancing trans-border transmission capacities by 1,000 MW.
The expected signing of a power trading agreement during Mr. Modi's visit did not materialise because of Nepalese objections to what was quite evidently not a well-worded Indian draft. The agreement is, however, expected to be finalised shortly. Optimism has also been voiced about finalising an agreement for commencing work on the 5,600 MW Pancheshwar multipurpose project within the next year. One encouraging development is Nepal will issue 28 survey licences to Indian private companies for hydropower projects amounting to 8249 MW. Some of these surveys have been completed, but much work needs to be done for finalising power-purchase agreements and financial closure. The issue of the duration of these projects also needs to be mutually agreed upon. But progress appears to have been made in finalising details in the 900 MW Upper Karnali Project being undertaken by GMR. A word of caution is necessary. Energy diplomacy with Nepal will have to be conducted sensitively with patience and forbearance, given the country's current constitutional impasse.
Energy cooperation seems to be increasing significantly with India's eastern neighbours who are members of the BIMSTEC. The experience of India's cooperation with Bhutan has been radically different from what has emerged in its relations with Nepal. Bilateral cooperation was initiated with the commissioning of a 60 MW hydro-electric project in April 2006. The first of six hydro-electric projects of 170 MW, the Tala Project, was commissioned in July 2006. Ten hydro-electric projects were agreed for implementation in 2009. Three of these projects are under construction. Project reports for four other projects have been finalised and are under examination by the two governments. The project reports for the other three projects are expected to be finalised soon. India and Bhutan appear well set to achieve the target of 10,000 MW by 2020.
India commenced the supply of 250 MW of power to Bangladesh last year after the government-run Bangladesh Power Development Board and a subsidiary of India's National Thermal Power Corporation (NTPC) signed a deal on Feb 28, 2012. This followed an agreement signed during Bangladesh Prime Minister Sheikh Hasina's visit to New Delhi in January 2010. That agreement led to the establishment of a 500 MW cross-border interconnection between Baharampur in West Bengal and Bheramara in Bangladesh. The Chief Minister of Tripura recently confirmed the readiness of the state to supply a further 100 MW to Bangladesh, which provided unprecedented transit facilities for the movement of heavy equipment for the development of power plants in Tripura.
India and Bangladesh are reported to have tentatively agreed to connect their distribution networks for the transfer of 6,000 MW of hydro-electric power from Assam to Bihar, via Bangladesh. The network could ultimately connect two other SAARC members — Nepal and Bhutan — opening up hydro-electric power generation across the region. There is huge hydropower potential in India’s Northeast. Arunachal Pradesh alone has the potential to produce 50,000 MW. Neighbouring Myanmar, with a hydro-electric potential of 40,000 MW, is ready to cooperate with both China and India in projects that meet its environmental concerns. The NTPC and the Ceylon Electricity Board (CEB) signed an agreement for setting up a 500 MW coal fired power plant, to be commissioned in 2016, in Sri Lanka's northern province. The two countries are also studying options for a high voltage DC Grid, linking either Madura or Tuticorin in Tamil Nadu to Anuradhapura or Puttalam.
Though an agreement was reached on the “TAPI Pipeline” to bring gas from Turkmenistan to India through Afghanistan and Pakistan, it is unlikely that the security of this pipeline can be guaranteed for years. China has, in the meantime, commenced negotiations for a Turkmenistan-Afghanistan-China gas pipeline, which traverses through relatively violence and terrorism-free areas. Faced with pressure from the Saudis and Americans, the Nawaz Sharif government recently reneged on an agreement signed by President Zardari for an Iran-Pakistan pipeline. Iran, which incurred a substantial expenditure on this project, has threatened punitive legal action.
The Nawaz Sharif government has also backed off from proposals for energy cooperation with India, under pressure from the army, repeating what it did in 1999. India should examine the prospects of obtaining Iranian natural gas directly through an undersea pipeline, estimated to cost $ 4-5 billion, to carry 31 million cubic metres of gas a day. But actual work can commence only after current international banking sanctions on Iran are eased, or ended.
In these circumstances, we should realise that BIMSTEC is the regional grouping that offers the best opportunity for energy cooperation. We would find China filling the vacuum in yet another strategic sector, if we do not move imaginatively in developing energy cooperation across our land and maritime borders, as China is doing across Asia.
Apart from the announcement of additional economic assistance of $1 billion, Mr Modi’s visit resulted in a movement forward on border demarcation and a review of the contentious India-Nepal Treaty. But what can change the dynamics of India-Nepal relations and accelerate economic progress in Nepal is the mutually beneficial utilisation of Nepal's potential for 83,000 MW hydro-electric power. Despite this, Nepal imports electricity from India. An understanding was reached during the visit of Mrs. Sushma Swaraj to expedite the construction of transmission lines so that Nepal could import additional power from India. The World Bank is also assisting Nepal in enhancing trans-border transmission capacities by 1,000 MW.
The expected signing of a power trading agreement during Mr. Modi's visit did not materialise because of Nepalese objections to what was quite evidently not a well-worded Indian draft. The agreement is, however, expected to be finalised shortly. Optimism has also been voiced about finalising an agreement for commencing work on the 5,600 MW Pancheshwar multipurpose project within the next year. One encouraging development is Nepal will issue 28 survey licences to Indian private companies for hydropower projects amounting to 8249 MW. Some of these surveys have been completed, but much work needs to be done for finalising power-purchase agreements and financial closure. The issue of the duration of these projects also needs to be mutually agreed upon. But progress appears to have been made in finalising details in the 900 MW Upper Karnali Project being undertaken by GMR. A word of caution is necessary. Energy diplomacy with Nepal will have to be conducted sensitively with patience and forbearance, given the country's current constitutional impasse.
Energy cooperation seems to be increasing significantly with India's eastern neighbours who are members of the BIMSTEC. The experience of India's cooperation with Bhutan has been radically different from what has emerged in its relations with Nepal. Bilateral cooperation was initiated with the commissioning of a 60 MW hydro-electric project in April 2006. The first of six hydro-electric projects of 170 MW, the Tala Project, was commissioned in July 2006. Ten hydro-electric projects were agreed for implementation in 2009. Three of these projects are under construction. Project reports for four other projects have been finalised and are under examination by the two governments. The project reports for the other three projects are expected to be finalised soon. India and Bhutan appear well set to achieve the target of 10,000 MW by 2020.
India commenced the supply of 250 MW of power to Bangladesh last year after the government-run Bangladesh Power Development Board and a subsidiary of India's National Thermal Power Corporation (NTPC) signed a deal on Feb 28, 2012. This followed an agreement signed during Bangladesh Prime Minister Sheikh Hasina's visit to New Delhi in January 2010. That agreement led to the establishment of a 500 MW cross-border interconnection between Baharampur in West Bengal and Bheramara in Bangladesh. The Chief Minister of Tripura recently confirmed the readiness of the state to supply a further 100 MW to Bangladesh, which provided unprecedented transit facilities for the movement of heavy equipment for the development of power plants in Tripura.
India and Bangladesh are reported to have tentatively agreed to connect their distribution networks for the transfer of 6,000 MW of hydro-electric power from Assam to Bihar, via Bangladesh. The network could ultimately connect two other SAARC members — Nepal and Bhutan — opening up hydro-electric power generation across the region. There is huge hydropower potential in India’s Northeast. Arunachal Pradesh alone has the potential to produce 50,000 MW. Neighbouring Myanmar, with a hydro-electric potential of 40,000 MW, is ready to cooperate with both China and India in projects that meet its environmental concerns. The NTPC and the Ceylon Electricity Board (CEB) signed an agreement for setting up a 500 MW coal fired power plant, to be commissioned in 2016, in Sri Lanka's northern province. The two countries are also studying options for a high voltage DC Grid, linking either Madura or Tuticorin in Tamil Nadu to Anuradhapura or Puttalam.
Though an agreement was reached on the “TAPI Pipeline” to bring gas from Turkmenistan to India through Afghanistan and Pakistan, it is unlikely that the security of this pipeline can be guaranteed for years. China has, in the meantime, commenced negotiations for a Turkmenistan-Afghanistan-China gas pipeline, which traverses through relatively violence and terrorism-free areas. Faced with pressure from the Saudis and Americans, the Nawaz Sharif government recently reneged on an agreement signed by President Zardari for an Iran-Pakistan pipeline. Iran, which incurred a substantial expenditure on this project, has threatened punitive legal action.
The Nawaz Sharif government has also backed off from proposals for energy cooperation with India, under pressure from the army, repeating what it did in 1999. India should examine the prospects of obtaining Iranian natural gas directly through an undersea pipeline, estimated to cost $ 4-5 billion, to carry 31 million cubic metres of gas a day. But actual work can commence only after current international banking sanctions on Iran are eased, or ended.
In these circumstances, we should realise that BIMSTEC is the regional grouping that offers the best opportunity for energy cooperation. We would find China filling the vacuum in yet another strategic sector, if we do not move imaginatively in developing energy cooperation across our land and maritime borders, as China is doing across Asia.
http://www.tribuneindia.com/2014/20140814/edit.htm#5
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