Delay in signing power treaty mars PM Narendra Modi’s hailed Nepal visit

NEW DELHI: PM Narendra Modi failed to clinch an important treaty with Nepal in an otherwise successful visit as Kathmandu dragged its feet in completing modalities for signing a power trading agreement ( PTA) that would have ushered in major energy cooperation.

ET has learnt that Katmandu sent the draft of the agreement to Delhi just two days before the PM’s trip. Official sources told ET that this did not allow conclusion of the processes to sign PTA during the high-profile visit. This is why the joint statement issued at the end of the trip called for removing delays in bilateral projects.

While it was agreed during External Affairs Minister Sushma Swaraj’s visit to Katmandu that a PTA would be signed during Modi’s trip, various stakeholders in Nepal, including political parties and civil society experts, could not reach a consensus on PTA ahead of the big visit. These stakeholders questioned a provision in the draft PTA ahead of the trip.

They claimed it allowed only Indian firms the right to build Nepal’s hydroelectric projects. However, the Indian embassy in Nepal denied this claim. “The draft PTA is in the nature of a framework agreement that outlines broad principles and parameters for overall cooperation in the power sector including trading, transmission lines’ development, grid connectivity and construction of power projects,” embassy sources said, adding, PTA does not take away Nepal’s sovereign right to develop power projects.