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Corporate Dec 19, 2012

Nepal allows GMR to raise paid up capital in hydro projects

Kathmandu: The Nepal government has allowed Indian infrastructure major GMR to increase the authorised capital in its hydro power projects in Nepal to Rs 1900 crore while also extending its survey license by six months.

GMR, which is developing 900 MW Upper Karnali Project had requested the government to extend the license after it expired recently.

The Maoist-led caretaker government also extended the survey license of 600 MW Upper Marsyangdi Power Project which expired in November 2011.

The Maoist-led caretaker government also extended the survey license of 600 MW Upper Marsyangdi Power Project which expired in November 2011.

A meeting of the high-level Investment Board chaired by Prime Minister Baburam Bhattarai yesterday took the decisions to renew the licenses, according to officials. Similarly, the government has decided to allow Upper Karnali Hydropower Company Ltd and Himal Hydropower Company Ltd established in Nepal by GMR India to develop Upper Karnali and Upper Marsyangdi projects respectively.

The meeting also decided to increase the authorised capital for each of the two companies from Rs 45 crore to Rs 1900 crore, sources at the Investment Board said.

Authorised capital is the maximum amount of capital which a company can raise through shares. The two companies had sought the government's permission for raising capital investment after they increased their project capacity.

Upper Karnali was originally meant to produce 300 MW of electricity, which has been increased to 900 MW and Upper Marsyangdi's capacity has been increased from original 250 MW to 600 MW. The Board has also granted permission to India's two power companies GMR and Satluj Jal Vidyut Nigam to open their offices in India to explore markets for the power produced by them in Nepal.

Satluj is developing the 600 MW Arun Third Hydropower Project. It is worth recalling here that some three years ago, the local Maoist cadres had set ablaze three offices of GMR in
Dailekh district where its Upper Karnali project is located claiming that the project was against the national interest of Nepalese people.

PTI


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