The MoU signed between China's Three Gorges International and the government this week has reinvigorated hopes for the energy anemic Nepali economy. The 750 MW installed capacity project, in which 25 per cent of will be invested by Nepal government, will help to bring an end to Nepal's energy crisis.
The representatives of Three Gorges also promised to help Nepal obtain soft loan from China's Axim bank. The project, although ambitious considering Nepal's past history with big projects, offers hope specially with the international reputation Three Gorges commands after it successfully completed world's largest hydro project in China's Yangtze river during which it successfully relocated 1.3 million people.
The other important factor that makes this project useful for the country is, the generated power will entirely be for Nepal's internal consumption.
This guarantees Nepal's future energy security. However, there are other issues related to the projects like revisiting the DPR to include changes, negotiating the power purchase agreement and ensuring that the project has minimum environmental impact.
The legacy of bad energy politics, which affected projects like Arun III and Upper Karnali in the past must not be continued. An estimated fifteen thousand people will have to be relocated during the construction of the project, which should not be politicized and everybody concerned must facilitate their successful rehabilitation.