Prachanda’s India visit next week to focus on cross-border power sharing, energy & infra deals

Nepal’s Prime Minister Pushpa Kamal Dahal 'Prachanda' is due in India on May 31 at the start of a four-day visit during which he is expected to sign multiple deals including an arrangement that will allow the Himalayan nation to sell power to Bangladesh using Indian transmission lines.

This will be Prachanda’s first bilateral visit abroad after assuming office in December 2022.

Prime Minister Narendra Modi will meet Prachanda in New Delhi on June 1, ET has learnt.


The visiting prime minister will be accompanied by a high-level delegation comprising senior officials as well as business and industry leaders.

More than half a dozen agreements and memoranda of understanding could be signed and announced during the visit.

These include an extension of the India-funded petroleum pipeline in Nepal, construction of integrated check posts in Bhairahawa, Chandani-Dodhara and Nepalgunj, developing the Phukot-Karnali hydroelectric plant with an installed capacity of 480 MW and handover of the new 17-km expanded railway line to Bijalpura on the Jayanagar-Kurtha-Bijalpura-Bardibas railway section.

According to sources, the two sides will sign an agreement to lay a new petroleum pipeline from Siliguri in West Bengal to Jhapa in eastern Nepal and extend the existing Motihari-Amlekhgunj petroleum pipeline to Lothar in Nepal’s Chitwan district.

Nepalese officials said other possible agreements that could be signed between the two sides are related to biodiversity, supply of chemical fertilisers by India and cross-border energy cooperation, including energy trade, and construction of a transmission line between Butwal in western Nepal and Gorakhpur in Uttar Pradesh.

There could also be a deal on the interconnection service agreement of the Butwal-Gorakhpur cross-border transmission line. State-owned Nepal Electricity Authority and Power Grid Corporation of India have signed an agreement to develop the 400KV Butwal-Gorakhpur cross-border transmission line on the Indian side with joint investment.

Nepal will, however, develop the section of the proposed transmission line on its side. As things stand, around 120km of the transmission line’s 135 km length would lie in the Indian territory.

Talks are also going on for the development of the 679MW Lower Arun Hydropower Project in eastern Nepal, sources said.

This will be the second mega-project undertaken by India after the $1.04 billion 900-MW Arun-3 Hydroelectric Project on the Arun River.

The Nepali side is also pitching for a long-term energy trading agreement with India where the Nepal Electricity Authority doesn’t have to take approval for trade with India on a piecemeal basis, an official at Nepal’s energy ministry said. There is also a proposal on the table regarding an amendment to the Nepal-India Bilateral Transit Treaty.