While the construction of the 400 kV Butwal-Gorakhpur cross-border transmission line has gained momentum in India, the work has just begun on the Nepali side.
The 98-kilometre section of the transmission line falls on the Indian side, while Nepal needs to build an 18-kilometre section within its borders.
However, officials expect the work on the Nepali side to be completed on time, given its shorter length.
The project was jointly inaugurated by former Prime Minister Pushpa Kamal Dahal and his Indian counterpart Narendra Modi during Dahal's visit to India earlier in May this year.
According to NEA, the state-owned power utility, construction work on the Indian section has advanced significantly.
Rupesh Shah, Coordination Officer of Butwal-Gorakhpur Cross-Border Power Transmission Limited, said that about a half of the foundation laying work for the transmission towers has been completed on the Indian side.
Nepal, meanwhile, just completed the contract signing work to carry out the construction work last week. It will be funded by the Millennium Challenge Corporation (MCC).
On August 30, the Millennium Challenge Account Nepal (MCA-Nepal), formed to implement the MCC Compact programme, signed the contract worth $12.36 million (or around Rs 1.66 billion with an Indian company, Transrail Lighting Ltd. to built the 18-kilometre section from the 400 kV New Butwal Substation in Nawalparasi Bardhaghat Susta West to the Nepal-India border.
Under the MCC Compact program, the Nepal section must be completed within 21 months. The program includes the construction of a 315-kilometre, 400 kV power transmission line and the upgradation of some sections along the East-West Highway.
The transmission line on the Indian side is being constructed by a joint venture between NEA and India's Power Grid Corporation.
“A total of 248 towers will be erected for the transmission line, with 27 already constructed and the foundations for 121 already laid on the Indian side,” Shah said. “Given the current pace, the project might be completed ahead of schedule.”
The deadline for the Indian section has been set for May 2026.
Shah noted that the lack of disputes over land acquisition and compensation has allowed for smooth progress.
The total cost for the project is estimated to be Rs 6.4 billion, with Rs 1.28 billion (or 20%) as equity investment.
Nepal is required to contribute Rs 640 million.
Upon completion, the line will enable the transmission of 2,000 MW of electricity from Nepal's western region.
The long-term energy trade agreement between Nepal and India envisions Nepal exporting up to 10,000 megawatts to India in the next 10 years.
Nepal’s installed capacity of electricity increased to 3156.96 MW by the end of the last fiscal year, with 2990.6 MW of hydro electricity.
NEA expects electricity production to reach 10,000 MW within five years.
However, officials warn that the delay in construction of transmission lines could bar export of additional electricity to India.
Nepal became the net-exporter of electricity, three years after entering in the energy trade with India, in the last fiscal year.
Nepal exported around 1.94 billion units of electricity worth Rs 16.93 billion to India during the rainy season in the period while importing electricity worth Rs 16.81 billion from the southern neighbour during the dry season in the same period, according to the Nepal Electricity Authority (NEA).
MCA-Nepal has set a timeline for construction companies to ensure the completion of the work on both sides of the border simultaneously.
Although bids were invited last year, all were cancelled due to high costs.
If Nepal fails to complete its part by the time India’s section is completed, penalties will be incurred, according to Dirghayu Kumar Shrestha, Director of the Transmission Directorate at the NEA.
India's SJVN Limited, currently building the 900 MW Arun III Hydropower Project in Eastern Nepal, is also constructing the Dhalkebar-Sitamarhi transmission line.
Nepalese officials have raised concerns that local obstructions could delay the completion of such vital infrastructure projects, impacting Nepal’s power trade goals.
