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Power Summit – 2008, Kathmandu
Developer’s perspectives;
Road Ahead for Hydro Power
Project implementation in Nepal
Key Highlights
1
2
GMR : Leading Infrastructure Player
3
4
5
Power
6
7
8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
GMR Group : A Diversified Conglomerate
The GMR Group was established in 1976 and is a listed company on Bombay Stock Exchange (BSE)
and National Stock Exchange (NSE).
GMR Group has rapidly expanded into infrastructure and other businesses:
Infrastructure
Airports
Energy
Roads
GMR Industries Ltd
Agro based Business
Sugar plant in Sankili in AP having cane crushing capacity of 5000
tonnes per day
Constructing an integrated Sugar complex in Haliyal having cane crushing
capacity of 3500 tonnes per day
GMR Varalakshmi Foundation
Corporate Social
Responsibility
 The Foundation has been working with communities in the quest of
improving lives and livelihoods since 1991
 It focuses on Education, Health, Hygiene and Sanitation, Livelihood and
Empowerment and Community Development
The Group was also engaged in the Banking (ING Vysya) & IT (iGate), which were divested with shift
in focus to infrastructure.
GMR Infrastructure : India’s Leading Infrastructure Company
AIRPORTS
 Delhi Airport Development
 Hyderabad Airport
 Istanbul Airport Modernization
ENERGY
 Power Projects (10 Nos)
 Operational (3 Nos)
 Under development (7 Nos)

Flagship company of the GMR group
Infrastructure Developer, Owner & Operator of Airports,
Power, Roads and SEZs
Assets with exclusive concessions ranging from 15-60 Years
Balanced Revenue Model – blend of stable and volume
driven growth streams
Current Market capitalization of Rs. 2,900 bn (US$ 7 bn)
Gross Capacity of 4097.625 MW
HIGHWAYS
 Road Projects (6 Nos; 444 km)
 Operational (2 Nos;152 km)
 Under construction (4 Nos; 292 km)
Key financials
 FY08: Gross Revenue – Rs. 270 bn; PAT(After MI) – Rs. 21 bn
Net Revenue ( FY08)
EBITDA ( FY08)
URBAN INFRASTRUCTURE
 3,300 acres SEZ in Tamil Nadu
 250 acres Aviation specific SEZ on
eastern side of Hyderabad Airport
 250 acres Multiproduct General SEZ on
western side of Hyderabad Airport
Total = Rs. 229 bn
Total = Rs. 67 bn
GMR Infrastructure : A Compelling Growth Story
1
Key player in the Indian Infrastructure story:
 Over US$ 500 bn investments planned over next five years
 PPP model to play significant role in the Infrastructure sector
 GMR is well positioned to benefit from this large growth opportunity
 Entry in the MSCI India index reinforces the company’s credentials in infrastructure development
2
Broad Based Infrastructure player:
 Significant presence across high growth sectors like airports, power and roads
 Consistently enjoyed early mover advantage in all the business segments
3
Strong track record & established Player:
 Extensive experience of developing and executing projects
 Established a reputation of reliability and timely project completion
4
Balanced revenue mix:
 Healthy mix of fixed and variable revenue streams across airports, power and roads
5
Strong Management Team:
 Experienced management team backed by strong global partnership
6
Significant Growth Opportunities:
 Plans to tap into new opportunities in India and Abroad in the infrastructure space
Key Highlights
1
2
GMR : Leading Infrastructure Player
3
4
5
Power
6
7
8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
Passenger Traffic : Growth In Leading Indian Airports
PAX (Dom+Int) distribution in FY2008 (Total PAX = 116.87 mm)
30
25
25.86
22.25
23.97
20.44
21%
In Mn
20
42%
15
10.66
8.97
10
10.12
8.12
7.46
Delhi
5.99
Hyderabad
6%
6.99
5.75
Mumbai
Chennai
5
Other 42 Airports
0
Mumbai
Delhi
Chennai
FY 07
Bangalore
Kolkatta
Hyderabad
22%
9%
FY 08
Delhi and Hyderabad airports control 27% of the passenger traffic
Traffic Growth ( % )
44%
44%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
FY 08
36%
32%
FY 07
26%
25%
21%
Mumbai
Delhi
22%
19%
17%
16%
25%
Chennai
Bangalore
Kolkatta
Hyderabad
Delhi Airport accounted for the highest growth in air passengers movement in the world in 2006 (Source: TOI)
Delhi International Airport: Modernization and development of one
of the busiest airports in the sub-continent
Financing Plan (Phase I)
Project Overview
Concession period
30 + 30 years
Phases of development
I, II, III, IV & V
Land
5,100 acres
Ultimate pax capacity
100mn (Phase I: 34mn)
Ultimate cargo capacity
3.6 mn tons (Phase I: 0.6 )
Completion date
2010 (Phase I)
Estimated project cost
US$ 2,244mn (Phase I)
Revenue Share
45.99 % shared with AAI
Source
Equity including internal
accruals
Unsecured loans/Interest Free
Deposits/Redeemable Preference
Shares
Loan from FIs/Banks
Total
Consortium Partners
Contribution ($mm)
Sponsor
Shareholding
50.1%
312
10.0%
685
10.0%
3.9%
1,247
2,244
( INR 89 bn )
26.0%
Delhi International Airport: Glimpses of Phase 1A
Domestic Departure
Domestic Arrival
International Terminal
Delhi International Airport: Glimpses of Phase 1B
Terminal 3
Hyderabad International Airport: Development of fastest growing
airport in India
Consortium partners
Project overview
30 + 30 years
Phases of development
I, II, III & IV
Land under development
5,500 acres
Ultimate pax capacity
40mm (Current capacity of 12mm)
Concession fee
4% of revenue (deferred payment
basis from 11th year)
Commercial operation
23rd March 2008
Estimated project cost
US$620mm (Phase I) (INR 24800 mm)
Master Planners
Consortium comprising of Cowi of
Norway, Avai Plan of Denmark & Stup
of Mumbai
Hyderabad International Airport
Concession period
Sponsor
Phase I Development completed . . . . . .
Catchment area
Shareholding
63.0%
11.0%
13.0%
Hyderabad
13.0%
Uniquely positioned to capitalize on the
current growth
 Emergence of Hyderabad as a major IT& ITeS
destination
 Centrally located with respect to India, South-East
Asia and Middle East
 Catchment area of 75mm people
 Growth in the passenger traffic - 40% over the past
2 years (2005-07)
 First Airport in the country to get ‘Leeds’
Certificate for leadership in Energy &
Environmental Design
Phase I Development completed on 23rd March 2008
 Airside & Landside works contractor: Larsen &
Tubro
Source: AAI website, Company
Hyderabad International Airport: Glimpses
Hyderabad International Airport: Glimpses
Hyderabad International Airport: Glimpses
Sabiha Gokcen International Airport – Turkey Overview
Turkey’s Economic Overview
th
 17 largest economy and among the top ten
emerging markets
 Total population of about 70 million with
nominal GDP of about USD 400 bn

Istanbul has a population of about 14 mn
with 35% residing on the Anatolian side
Turkey’s Aviation Sector
 Passenger traffic growing at 25% plus per
annum since 2003 fuelled by Low cost
Carriers.
 Turkey comprises of 52 Airports having the
State Authority responsible for operations
 Tourist Traffic to Turkey is about 20 mn pax
(4 mn pax from Istanbul)
 The Annual Passenger Traffic in Turkey has
been 58.78 mn pax (Domestic – 26.65 mn
and International 32.13 mn – CAGR 15%
Sabiha Gokcen International Airport
Development plan for the Sabiha Gokcen International Airport in Istanbul
Car Park Area
Existing Int’l +
Domestic
Terminal
New
International
Terminal
Hotel
Sabiha Gokcen International Airport
Key Highlights
1
2
GMR : Leading Infrastructure Player
3
4
5
Power
6
7
8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
GMR has successfully implemented and operationlized Power Assets
GMR Energy Limited
GMR Power Corporation
Pvt. Ltd.
Facility
Mangalore, Karnataka
Contracted Capacity
220 MW
Fuel
Naptha
COD
2001
PPA
7 Years till 2008; at 85% PLF
Take or pay fixed charges
Facility
Chennai, Tamil Nadu
Contracted Capacity
200 MW
Fuel
Low Sulphur Heavy Stock
COD
1999
PPA
15 Years till 2014; minimum
offtake at 68.5% PLF
Take or pay fixed charges

Barge-mounted power plant

One of the largest operational
Independent Power Producer (IPP) in
Karnataka

ISO 14001, ISO 9001 and OHSAS 18001
certified

Evaluating the options for relocation
Post PPA

ISO 14001 and OHSAS 18001 compliant

Dr. M.S. Swaminathan Award for being
an environment friendly project
Vemagiri,
Andhra Pradesh

Company’s third Greenfield power project

PPA got extended from 15 to 23 years
Contracted Capacity
Contracted – 370 MW
Merchant Sale – 17.625 MW

Expansion plan for additional 700 MW
capacity
Fuel
Natural Gas

Operating on diverted gas made available
by GAIL as per the directive from Andhra
Pradesh Power Coordination Committee
COD
2006
PPA
23 Years till 2029; at 80% PLF
Take or pay of fixed charges
Facility
Vemagiri Power
Generation Ltd.
Strong pipeline of power projects under development
Power assets under development
Facility
Location
Capacity
Fuel
Contract details
1
Orissa (Coal)
Kamalanga, Orissa
1,050 MW
Coal
Build Own and Operate for
2
Chattisgarh (Coal)
Chattisgarh
1,050 MW
Coal
Build Own and Operate for 40 years from Plant COD
25 years from Plant COD
Expected CoD
Project status
2012
 Land acquisition process started (Sec
6(1) notification completed.
 Coal linkage of 500 MW obtained and
awaiting LOA from Mahanadi Coal
Fields.
 Coal allocation namely “Rampia” &
Dip Rampia” obtained for 1000 MW
capacity.
 A Joint Venture Company has been
formed by all the 6 allocattees of the
coal block.
 EPC contract finalised with SEPCO.
 PPA: GRIDCO (upto 25%) and remaining
with Power Trading Corporation ( PTC).
 IDFC has appraised the project and 50%
of the loan has been sanctioned.
Planned Action
 Completion of Land Acquisition
 Finalisation of coal linkage for balance
500 MW and signing coal supply
Agreement.
 Award of NTP.
 Financial Close.
2012
 Signed MOU with the
Govt. of Chhattisgarh.
 State is entitled to avail 5% of
net energy and has the right to
purchase up to 30% of the
power for 20 years.
 State Govt. has recommended
to the Ministry of coal for coal
linkage.
 Pre feasibility report submitted
and approved by Dept. of
Energy.
 Draft DPR under review.
 Land Identified and state Govt.
agreed to allot the same.
 Railway siding feasibility and
location survey being carried
out for coal transportation.
3
Uttaranchal (Hydro)
Badrinath, Uttaranchal
300 MW
Hydro
Build Own and Operate for 45
years from Implementation
Agreement
2013
 DPR finalised and submitted.
 Project capacity revised to
300 MW with Design Energy @
1117 MU (PLF 42.50%).
 Clearance obtained from
Ministry of Environment &
Forests.
 SNC– Lavalin appointed for
review of DPR, Tendering and detailed
engineering.
 Concurrence of CEA – August 2008
To execute the implementation
agreement after CEA
concurrence on DPR.
 Initiate forest clearance and
Land Acquisition.
 Signing Implementation
Agreement.
Strong pipeline of power projects under development
Power assets under development
Facility
5
Arunachal Pradesh (Hydro)
6
Himachal Pradesh (Hydro)
7
Nepal (Hydro)
8
Nepal (Hydro)
Location
Talong, Arunachal Pradesh
Bajoli Holi, Himachal Pradesh
Upper Karnali, Nepal
Upper Marsyangdi
Capacity
160 MW
180 MW
300 MW
250 MW
Fuel
Hydro
Hydro
Hydro
Hydro
Contract details
Run of the River on BOOT basis for a
concession period of 40 years from COD
Run of the River Build Own and
Operate for 30 years from Plant
COD
Build Own and operate for
30 years from Plant COD
Expected COD
Project status
2014
 MOA with the State Govt.
 Colenco of Switzerland has been
appointed as the principal engineer.
 Terms of Reference for Environment
study approved by MOEF.
 Consultants have been appointed for
carrying out Environment Impact
Assessment and Environment
Management Plan.
 GEL has offered 14% free power and
12% Equity in the SPV.
Run of the River on BOOT basis for a
concession period of 40 years from COD
2015
 Upfront premium of US $ 20.5 Mn
paid to the Govt. of Himachal Pradesh
 Pre – Implementation Agreement
signed with the Govt. of Himachal
Pradesh.
 DPR preparation is under process by
in house engineering team.
 Royalty power offered : 12% (Yr 1-12),
18% (Yr 13-30), 30% (Yr > 30).
2015
 MOU signed between GMR –
ITD consortium and Govt. of
Nepal.
 Incorporated a company
namely GMR Upper Karnali
Hydro Power Limited.
 GEL has offered 12% free
power and 27% free Equity to
the Govt.of Nepal.
2015
 GMR owns 80% shares in Himtal
Hydropower Company.
GMR is taking care of all Project
development activities and is
preparing the DPR for the Project.
Towards securing fuel supply for Power Plants
Coal mines in South Africa and Indonesia
 GMR has acquired 5% stake in Homeland Mining and
Energy, a South African Subsidiary of Homeland
Energy Group Ltd, Canada
 GMR has the option to acquire additional 45% stake
of Homeland South Africa.
 Homeland South Africa owns Mining Licenses for
Kendal (74% share - Reserve 34m ton), Eloff (50%
share with option to increase to 74% - Reserve 382m
ton) and North Field (100% share – Reserve 1m ton )
with total reserves of 417m ton.
 Production from Kendal mine would be 1.8m tpa.
Eloff mine would produce 6m tpa in phase 1 which
would increase to 12m tpa in phase 2.
Acquisition of 50% shareholding in Intergen
Intergen is a global Power generation Utility with
over 12000 MW of Power Projects in 5 different
continents around the world
 Over 8000 MW out of the above is operational in the
following countries:
 Mexico
 United Kingdom
 Holland
 Australia
 Philippines
 GMR’s newly acquired footprint in all these diverse
locations shall help achieving its burgeoning
international growth ambitions
 This is the largest international acquisition by an
Indian Co. in the Power Utility sector.
 This acquisition has catapulted GMR as the largest
power generation company from India
Power projects: Continued focus on diversification of revenue, fuel
mix and expansion of geographic presence
4,097.625 MW of power projects spread across the country
1 Diversified fuel mix
Alaknanda
300 MW1
Fuel type - Hydro
CoD - 2013
Bajoli Holi
180 MW
Fuel type - Hydro
CoD - 2015
Upper Marsyangdi
250 MW
Upper Karnali
Fuel type - Hydro
Talong
300 MW
CoD – 2015
160 MW
Fuel type - Hydro
Fuel type - Hydro
CoD – 2015
CoD - 2014
Mangalore
220 MW
Fuel type – Naphtha
PPA – 7 years till 2008
(85% PLF)
Chattisgarh
1,050 MW
Coal power
CoD- 2012
Orissa
1,050 MW
Fuel type - Coal
CoD – 2012
Vemagiri
387.625 MW
Fuel type – Gas
PPA – 23 years till 2019
(80% PLF)
Chennai
200 MW
Fuel type – Sulphur
PPA – 15 years till 2014
(min. offtake at 68.5% PLF)
29%
 Projects distributed across
all the fuel types – Hydro,
thermal & Gas
Coal
51%
20%
Hydro
 Tied up fuel for most of the
plants
Total capacity = 4,097.625 MW
2 Diversified revenue mix
 Mix of short-term & long-term Power Purchase
Agreements (PPAs)
 Exiting 3 projects have long term PPAs tied up
 Fixed revenue stream from the Mangalore & Chennai
plant
 Availability of gas for the Vemagiri project to create
future revenue growth potential
 New projects (other than the Orissa project) have the
Operating assets
3 projects
Under implementation
7 projects
(807.625 MW)
(3,290 MW)
Liquid
Fuel
flexibility to choose between short-term/long-term PPAs
 Distribution of total capacity
PPA - 1390 MW, Merchant Power – 2,707.625 MW
Note: 1Capacity to be increased to 300 MW subject to approval of project development plan by CEA
Key Highlights
1
2
GMR : Leading Infrastructure Player
3
4
5
Power
6
7
8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
GMR Group Road Projects implemented/under implementation
Toll
Annuity
Particulars
Location
Road Length
Concession Period
Concession
Duration
Project Cost(Rs.Mn)
GTAEPL
GTTEPL
GPEPL
GACEPL
GJEPL
GUEPL
Tuni-Anakapalli
TambaramTindivanam
Pochanpalli
Ambala-Chandigarh
Faruknagar-Jadcherla
Tindivanam-Ulundurpet
59 kms
93 kms
Construct - 86 kms +
O&M Sweetener - 27
kms
Construct - 35 kms
Construct - 46 kms +
O&M Sweetener - 25
kms
Construct - 73 kms
17.5 years incl.
construction period
of 2.5 yrs.
17.5 years incl.
20 years incl.
20 years incl.
20 years incl.
construction period of construction Period of construction period of construction period of
2.5 yrs.
2.5 years
2.5 years
2.5 years
Construction Period of 2.5
years
20 years incl.
May. 2002 – Nov.
2019
May. 2002 – Nov. 2019 Oct. 2006 – Oct . 2026 May. 2006 – May. 2026 Aug. 2006 – Aug. 2026
Oct. 2006 – Oct. 2026
3040
3900
6900
3911
4713
7950
Financial Closure
June 2002
June 2002
September 2006
May 2006
August 2006
October 2006
Commercial
Operation Date
Oct 2004
Oct 2004
Nov 2008
Feb 2009
Apr 2009
Apr 2009
Project status as of
31st March 08
Started commercial
operations
Started commercial
operations
All major contracts
have been awarded
All major contracts
have been awarded
All major contracts
have been awarded
All major contracts have been
awarded
68% construction
completed
54% construction
completed
46% construction
completed
42% construction
Already Operational
completed.
Under Construction
Mobilizing all resources and harnessing the best practices in all aspects of project implementation to
ensure that the four Road projects under implementation are commissioned on schedule
Progress of Construction
Ambala – Chandigarh Road
Pochanpalli Road
Jadcherla Road
Ulundurpeth Road
Krishnagiri Special Economic Zone – Recent Foray
Project overview
Land Acquisition by December, 2008
Type of SEZ
Bio Technology, IT & ITES, Traditional electronics &
engineering companies
Location
Krishnagiri, Tamilnadu
Land
3,300 acres
Partnership
Tamil Nadu Industrial Development Corporation (TIDCO)
Basic Infrastructure : INR 23 Bn
Project Cost
Industrial and social Infrastructure : INR 110 Bn
Project Implementation To be Operational by 2009
Entire Development to be completed by 2014
Revenue Generation
Exports Turnover of INR 160 Bn by 2014
Investment Generation
INR 62 Bn (Next 4–5 years)
Entire land of 3300 acres has been identified.
Land acquisition is in progress (Approx..cost Rs.1.5 millions/acre).
Free from homestead, minimal Relocation & Rehabilitation.
Free from any wet and double crop lands.
Planned Action for next 12 months
Final Notification of SEZ
Completion of Development Plan for covering:
(a) Master Plan and Infrastructure Plan
(b Business Plan
Employment Generation Over 300,00 direct & indirect employment
(c) Demand Assessment
Connectivity
Preparation of Detailed Project Report
Through NH7 & Railway Network
Key Highlights
1
2
GMR : Leading Infrastructure Player
3
4
5
Power
6
7
8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
GMR has an experienced and dedicated team of individuals across
hierarchy managing projects across sectors
GMR Holding Board
GMR Infra Board
 G. M. Rao
GM Rao
Group
Chairman
Srinivas Bommidala
G Kiran Kumar
K. Balasubramanian
Chairman -Urban
Infrastructure &
Highways
Chairman Airports
Member Group
Holding Board
 Srinivas Bommidala
 G. B.S. Raju
 G. Kiran Kumar
 B.V. Nageswara Rao
 K.Balasubramanian
 O B Raju
GBS Raju
B V N Rao
P M Kumar
Chairman – Corporate
& International
Business
Chairman –
Energy & Agro
Member Group
Holding Board
 Arun K. Thiagarajan
 K.R. Ramamoorthy
 Prakash G. Apte
 R.S.S.L.N. Bhaskarudu
 T. R. Prasad
 Udaya Holla
 Uday M. Chitale
Management team
Airport
Energy
 B. S. Shantharaju – CEO
 Andrew Harrison – COO
 Shirish M Navlekar – CFO
 I Prabhakara Rao – VP – Project
Development
 Phua chai Teck – VP - Planning &
Develop
 Sudhir Mathur –Chief – Commcl .Officer
 Rajgopalsamy – CFO
 P Sripathy – Head -Project Mgmnt.
Urban Infrastructure & Highways
 Raajkumar – CEO
 Rajan Krishnan – COO
 G.K. Raghunandanan – CFO
 D R Santhana Krishna – CFO
 G Subba Rao – President – Hydro
 V Jayaraman – COO – Property Devlp.
 R. K Goel – VP – Transmission
 O Bangaru Raju – COO - Strategic
 S N Barde – VP – O & M
Contracts
 I V Srinivas Rao – VP – Finance
 V K Sharma – VP – Hydro
 Harvinder Manocha – Head Nepal
Projects
 Ashutosh Agarwala – CFO
Corporate Services
 K V V Rao – Director & President
 Ashish Basu – VP – Commercial &
Strategic Finance
International Development
Initiatives & Central Procurement
 Y M Shivamurthy – President, Legal
 A, Subba Rao, EVP – CIG
 Ranjit Muregesan , CEO
 A.S. Cherukupalli, EVP – Company Sec.
 Madhu Terdal, EVP
 Vijay Vancheswar – Head,Corp.Comm.
 Cenk – CEO – Turkey
 P M Kumar - ED – Group Corporate
Development
 R. Ram Mohan – EVP – GCM’s office
Key Highlights
1
2
GMR : Leading Infrastructure Player
3
4
5
Power
6
7
8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
Status of Project Development in Nepal – 300 MW Upper Karnali HEP
 Project MoU executed with MoWR
 JVA executed with NEA
 Foreign Investment approval received from Dept. of Industries (DoI), Govt. of Nepal
 JVC (Public Company) incorporated in Nepal
 Survey License obtained from DoED
 Certificate of commencement of operations obtained from DoI
 Project establishment at Surkhet finalised
 Project team is in place; Engineering office operational at Kathmandu
 Site is presently inaccessible due to heavy rains and landslides
 EIA Consultants appointed – M/s SchEMS and data collection process started
 Public Consultations for ToR and Scoping documents are being taken up
 Topographical Survey agency finalised and activities will commence immediately after monsoon
 DPR preparation started; Review of past studies undertaken by NEA (through CIWEC) are on
 CSR activities are being taken up after the current year monsoon
 At the time of DPR and Investigations stage itself
Status of Project Development in Nepal – 250 MW Upper Marsyangdi HEP
 80% shareholding taken over in Himtal Hydro Power Company
 Project site establishments are in place:
 Project team in place; Engineering office operational at Kathmandu
 Offices at Syange (Powerhouse site) & Taal (River diversion site) are operational
 Site is presently inaccessible due to heavy rains and landslides
 Project access road from Besisahar to Syange – washed away due to heavy monsoon
 Site visits are being undertaken through trekking and through helicopter at times
 Topographical Survey completed and geo-technical Investigations are underway
 Both these are being undertaken through local agencies in Nepal
 EIA Consultants - M/s SchEMS from Nepal ; Data collection process completed
 Approval of ToR & Scoping documents for revised capacity of 250 MW is expected shortly
 Approval process was delayed due to approval from ACAP / Wild life Board
 Project layout finalised and Engineering activities have started
 CSR activities are being taken up after the current year monsoon
 At the time of DPR and Investigations stage itself
Key Highlights
1
2
GMR : Leading Infrastructure Player
3
4
5
Power
6
7
8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
Issues in Hydro Power Project Development in Nepal
 What the Hydro Project developer looks for?
 Good infrastructure to and at site
 Flexibility to create the same, may be on a selective basis
 Availability of necessary approvals / clearances within reasonable time and efforts
 Simple & clear regulations, acting as ‘FACILITATOR’ rather than ‘OBSTRUCTOR’
 Clear and simple tax regime
 Decent law and order situation
 Supportive and facilitating Government at the centre and also at the district level
 Availability of Competitive financing options
 Are all these currently available in Nepal ?
 The intent and will of the Government to create this enabling mix is critical
 Developers have the will to implement and execute
 All they need is SUPPORT’ and an ‘ENABLING ENVIRONMENT’
 Nepal’s dream of achieving 10000 MW, requires some serious considerations on the above
Key Constraints in Hydro Power Project Development in Nepal
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Lack of infrastructure (Access roads, Transmission links)
Clearly defined Policy and Regulations
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Approvals and Clearances in a timely manner
Supply of construction materials & machinery
Conducive law and order situation
Adequate availability of :
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Construction Agencies and Engineering / EIA Consultants
Support services like Survey and Investigation agencies etc.
Skilled Hydro Manpower Resources
Situation is likely to reach alarming proportions in coming years
Evacuation of Power:
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Should be free from any ambiguity
Long term protection against ‘Change in Law’
Licensing / Right of Way for transmission lines
Connectivity with Indian Grid – Regulatory / Technical issues
Sale of Power in India:
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Long term / short term Open access
Tariff mechanism
Key Highlights
1
2
GMR : Leading Infrastructure Player
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4
5
Power
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8
Airports
Urban Infrastructure & Highways
Strong Management
Status of Project Development in Nepal
Issues in Project Development in Nepal
Requests to Govt. of Nepal
Requests to Govt. of Nepal
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Select few large Hydro Power Projects:
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Provide impetus to manufacturing inds. supplying goods to Hydro projects:
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Serious development on >3000 MW of Projects - Upper Tamakoshi, Upper Karnali,
Arun III, West Seti, Upper Marsyangdi, Tamakoshi II & III, Likhu etc.
Declare them as ‘National Priority Projects’
Proactively build access roads to identified Project sites
Allow Developers to build Infrastructure before ‘Generation License’
Create ‘Single Window Cell’ for hassle-free and expeditious clearances
Simplify Clearance procedure
Demand timely achievement of realistic and pre-agreed Project development and
implementation milestones, from Developers
Proactive Govt. support on:
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Land Acquisition / Right of Way
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Rehabilitation and Resettlement
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Availability of Explosives
Need to explore creation of substantive indigenous capacity in Cement and Steel
Open G2G dialogue with Govt. of India:
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High Voltage Transmission corridor and Grid connectivity / compatibility issues
Power exchange between countries on ‘Win-Win’ principles
Develop large Projects on PPP route
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Requests to Govt. of Nepal
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Licensing policy:
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Provide Fiscal benefits to improve ‘Investor Confidence’:
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Integrated Basin development - Preference for developers of large Projects for
additional projects in the same basin:
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Why not look at ‘Swiss Challenge’ route for such projects?
VAT exemption – already proposed in current year budget – a Welcome step
Restore Tax holiday provisions in Hydro Power
Liberalize dividend repatriation provisions for foreign investment
Generation License period – increase to 45 years
Deferment of royalty to improve financeability of long gestation Projects
Provide incentives to local industries in all areas of Hydro Power Support services
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Local Civil Contractors and Equipment suppliers,
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Survey and Investigation agencies, Transport and logistics service providers
Provide nation-wide boost to technical education
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To promote young Nepalese Engineers
Simplify banking regulations
Clarity and consistency in Customs and import policies
Strengthen Legal, accounting and taxation system
Consultations with IPPs in framing Acts, policies for Power sector
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Thank You