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Kathmandu, Dec 4 – The 1,200 MW Budhigandaki Hydropower Project, envisioned as a national landmark nearly 13 years ago, remains on paper while its cost has jumped by roughly Rs 150 billion due to delays and unresolved financial arrangements.

The government greenlit the project in FY 2069/70 BS with a target completion by FY 2083/84 BS. A development committee was formed, and compensation has been distributed to about 95 percent of affected locals. Despite these steps and a completed Environmental Impact Assessment, construction has yet to start.

Arjun Rajauria, CEO of the project, says all technical preparations, including the detailed project report and tender documents, are ready. “The project can move forward once financial arrangements are finalized,” he said.

The BHP’s base cost now stands at Rs 374 billion. Including Rs 3.2 billion in interest during construction, total projected expenses reach Rs 406 billion, up from Rs 255 billion in 2079 BS. The surge reflects more than a decade of delays compounded by funding gaps.

The government plans to implement the project under a public-private partnership model, with 70 percent debt and 30 percent equity. Of the equity, the government will hold 80 percent and the Nepal Electricity Authority 20 percent, though some shares may eventually be offered to the public to reduce debt.

A proposal suggests a total investment of Rs 248 billion: Rs 97.47 billion in equity and Rs 150 billion in concessional loans. Current government investments of Rs 45 billion could be converted into shares. Revenues from petroleum taxes, customs, and VAT during construction would also feed the project. Additional financing would come from energy bonds, banks, insurance companies, public funds, and co-financing from the Employees Provident Fund, Citizens Investment Trust, and Nepal Telecom.

People’s News Monitoring Service