NMB Bank, HIDCL investing Rs 7.4 billion in Upper Modi ‘A’

KATHMANDU: Upper Modi ‘A’ Hydropower Project having a capacity of 42 WM has achieved financial closure.

The project is being implemented by Modi Jalvidyut Company Ltd – a subsidiary of Nepal Electricity Authority (NEA). Located in Annapurna Rural Municipality of Kaski, it is estimated to cost Rs 10.57 billion. The promoters will contribute 30% of the cost as equity investment and secure the remaining 70% through bank financing.

A consortium of NMB Bank Ltd and Hydroelectricity Investment and Development Company Ltd have agreed to invest Rs 7.4 billion in the project. A tripartite loan financing agreement was signed between Modi Hydropower Company, NMB Bank, and HIDCL in Kathmandu on Tuesday, in the presence of Minister for Energy, Water Resources, and Irrigation Shakti Bahadur Basnet.

According to the agreement, NMB Bank will provide loan financing of Rs 4.4 billion, while HIDCL will lend Rs 3 billion.

Addressing the gathering, Minister Basnet mentioned that the government is formulating plans and strategies to increase the internal consumption of hydropower and export surplus energy to India and Bangladesh. Similarly, Energy Ministry Secretary Gopal Sigdel stated that preparations were underway to enhance transmission infrastructure to facilitate energy exports.

NEA Executive Director and Chairperson of Modi Jalvidyut Company Ltd, Kulman Ghising, expressed optimism that hydropower development in Nepal would make significant progress in the coming days. “Mega projects like the Upper Arun (1,061 MW) and Dudhkoshi Reservoir (635 MW) are expected to achieve financial closure by 2024. Projects with a combined capacity of 16,000 MW are in various stages of study and construction,” he added.

Modi Jalvidyut Company Ltd is also building the Upper Modi project having a capacity of 18.2 MW.