Govt seeks soft loan from China

KATHMANDU, April 20 :

The government has requested China to provide soft loan worth US$ 400 million for the construction of transmission lines for West Seti Hydropower Project (750 MW).

The project based in far-western Nepal is being developed by Chinese firm CWE Investment Corporation -- a subsidiary of China Three Gorges Corporation (CTGC).

The Investment Board of Nepal (IBN), which oversees hydropower projects of capacity 500 MW or more, said the request was made as per the Chinese government´s interest to assist in Nepal´s hydropower sector.

"The finance ministry has sent a formal letter to the Chinese foreign ministry seeking soft loan for the project," a high-level official at International Economic Aid Coordination Division under the finance ministry told Republica.

IBN and CWE Investment Corporation had signed a memorandum of understanding (MoU) to develop the project on August 27, 2012. As per the agreement, the project will be completed by 2019.

The project to be developed under the financial and technical assistance of the Chinese government is estimated to cost $2 billion. The Exim Bank of China has agreed to offer soft and commercial loans worth $1.6 billion for the project.

Source: Republica