Seventeen years after Indian investor GMR acquired the 900 MW Upper Karnali Hydropower Project, the company has secured the necessary investment. GMR had obtained the project’s development rights through a global tender in 2008.

With just two days remaining before the Supreme Court's deadline to either secure funding or relinquish the project, GMR informed the Investment Board Nepal (IBN) that it had received loan commitments from five Nepali banks and two Indian financial institutions.

The Supreme Court had set January 17, 2025 (today), as the final date for GMR to raise the required investment. KK Sharma, head of GMR Upper Karnali Company, confirmed that the documents verifying the investment were submitted to IBN on January 15.

“We have secured commitments of Rs 42 billion from a consortium of five Nepali banks, led by Nepal Investment Mega Bank Limited,” Sharma told New Business Age . “Additionally, significant commitments have been made by India’s Indian Renewable Energy Development Agency (IREDA) and Power Finance Corporation (PFC).” Notably, IREDA also holds a 5% equity stake in GMR Upper Karnali Company.

The Supreme Court had previously ordered the government not to extend the deadline for financial management, except for delays caused by interim court orders. Although GMR had requested an extension due to a two-month gap between the court's verdict and its full text, it managed to raise the necessary funds before the January 17 deadline.

Sushil Gyawali, Chief Executive Officer of IBN, confirmed that GMR submitted all required financial documents on time. “Both Indian institutions have committed to providing loans totaling NRs 104 billion),” Gyawali stated. GMR Upper Karnali Company is required to raise Rs 44 billion in equity and Rs 102 billion in loans. The submitted documents will now be reviewed by IBN’s board of directors.

Nepali banks contributing to the investment include Nepal Investment Mega Bank, Everest Bank, NMB Bank, and two others. “We have expressed our readiness to invest, but due diligence is still pending,” said Sunil KC, CEO of NMB Bank.

To facilitate fundraising, GMR sold a 5% stake to IREDA in September and a 34% stake to the Indian government-owned Sutlej Hydropower Corporation (SJVN). “SJVN’s involvement made it easier for GMR to secure the investment,” Gyawali added.

The project faced prolonged delays due to repeated deadline extensions for financial closure. Rights activists filed a case against these extensions, leading the Supreme Court to impose stricter deadlines. In July 2022, the government had extended the financial management deadline by two years, but the Supreme Court invalidated any further extensions following petitions filed in November 2022 and May 2023.

Despite these hurdles, GMR managed to secure the investment just as the final deadline approached. “I am satisfied that we have raised the necessary investment within the Supreme Court’s deadline,” Sharma said.