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Japan provides loan for Tanahun Hydropower Project



Japan's Contribution to the Energy Sector in Nepal dates back to 1975

KATHMANDU: The Government of Japan has agreed to extend a loan assistance up to ¥15,137,000,000, (equivalent to USD157,353,000, or about NRS13,653,000,000), to the Government of Nepal for the implementation of the Tanahun hydropower project in Japan’s Fiscal Year 2012.

Issuing a press release on Wednesday, the Embassy of Japan in Nepal, further informed that the loan carries a 0.01% interest rate per annum on the loan amount withdrawn and will be re-paid in 30 years, after the grace period of 10 years.

The notes to this effect were signed and exchanged by Kunio Takahashi, Ambassador of Japan to Nepal, and Shanta Raj Subedi, Secretary of the Ministry of Finance of the Government of Nepal, on behalf of their respective Governments.

In the meantime, Masataka Nakahara, Director General from JICA Headquarter, Tokyo, and Madhu Kumar Marasini, Joint Secretary of the International Economic Cooperation Coordination Division of the Ministry of Finance, also signed and exchanged a separate loan agreement for the implementation of the said project.

Under the notes, the Government of Nepal will utilise the loan assistance to purchase the products and/or services required for the construction of Tanahun Hydropower project located near Damauli, about 150km west of Kathmandu.

Tanahun Hydropower Project is a storage type hydropower project, with the total storage capacity of 295 millionM3, and an electricity generation capacity of 140mW even during dry season.

The basic objective of this project is to meet the growing energy demand in Nepal in general and to address the severe load shedding due to the production and demand gap during peak hours in particular.

On the occasion, ambassador Takahashi further said that after completion of this Tanahun Hydropower project, the total power generation capacity of storage type hydropower projects will increase to 232mW from the current level of 92mW (jointly from Kulekhani I and II Hydroelectric Project).

The Tanahun Hydropower Project is one of the most promising projects to be implemented under the loan assistance of the Japanese ODA, after 12 years of interval since the extension of the Melamchi Water Supply Project.

Japan’s Contribution to the Energy Sector in Nepal dates back to 1975.

Some of the significant Loan projects implemented in the energy sector by Japanese Aid are – Kulekhani Hydroelectric Project I, Kulekhani Hydroelectric Project II, Kulekhani Disaster Prevention Project I, Kulekhani Disaster Prevention Project II and Kaligandaki “A” Hydroelectric Project.

Also Read: Japan resumes soft loan after 11 years hiatus

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