Kathmandu, Nepal, December 22, 2014—IFC,
a member of the World Bank Group, has partnered with India’s GMR Group
to develop the 900 MW Upper Karnali hydropower plant, and two transmission
line projects in Nepal. The projects will meet energy demands and create
jobs in Nepal and the South Asia region.
The transmission projects will evacuate power from the Upper Karnali and
600 MW Upper Marsyangdi Hydropower projects in Nepal. IFC InfraVentures,
a global infrastructure project development fund, is a co-developer of
these projects. IFC will make investments for project development and help
achieve financial closure for these projects, which have a total investment
outlay of $1.7 billion. The Upper Karnali plant will create over 3,000
jobs and help reduce greenhouse gas emissions of nearly 2 million tons
of carbon dioxide equivalent annually. According to the joint development
agreement, 12 per cent of the power generated from the Upper Karnali project
will be provided free of cost to Nepal.
"This is the very first project
for which the Project Development Agreement was executed by the Investment
Board,” said Radhesh Pant, Chief Executive Officer, Investment Board Nepal.
“IFC's expertise in the international financial markets brings complementarity
and synergy to GMR's strengths in regional infrastructure. IFC's involvement
will help the project achieve timely financial closure, construction, and
“IFC’s financing and global
expertise in the hydro sector will help the projects become a game changer
for Nepal’s hydropower sector and will attract international investors,”
said G. M. Rao, Group Chairman, GMR Group. “The development of these projects
complements the initiatives taken by India and Nepal to establish high-capacity
cross-border transmission links to facilitate power trading between the
Nepal has significant hydropower potential
but less than 1 percent of it is developed. Only an estimated 46 percent
of the population has access to electricity. Over the last decade, demand
for power in Nepal has grown at 9 percent annually, while supply has not
“Hydropower is a powerful engine for economic growth in Nepal,” said
Vivek Pathak, IFC Director - Asia Pacific. “These projects will boost
a common energy market in South Asia, create sustainable employment, improve
quality of life, and provide reliable and clean energy for local industry.”
Nepal is a priority country for IFC.
Since 2008, IFC has been working closely with Nepal's private sector through
investments and advisory services. IFC has been working in developing infrastructure,
tourism, financial markets, transportation, and trade finance in the country.
In recent years, IFC has also been assisting the government to make doing
IFC, a member of the World Bank Group, is the largest global development
institution focused exclusively on the private sector. Working with private
enterprises in about 100 countries, IFC uses its capital, expertise, and
influence to help eliminate extreme poverty and boost shared prosperity.
In FY14, IFC provided more than $22 billion in financing to improve lives
in developing countries and tackle the most urgent challenges of development.
For more information, visit www.ifc.org