KATHMANDU: Nepal and India have agreed to collaborate for the development of the second transnational transmission line with the capacity of supplying around 20,000 megawatts of electricity.

According to the Nepal Electricity Authority (NEA), an investment agreement was signed between the two sides on Wednesday for the construction of the Butwal-Gorakhpur second transnational transmission line. The proposal to this regard was floated for a long, but no substantial progress was achieved.

It may be noted that the Energy Secretary-level meeting of Nepal and India some three years back had agreed to construct the transmission line with a total capacity of 400 KV. As per the agreement, the transmission line will be constructed on the joint venture of NEA and Power Grid Corporation of India.

NEA Executive Director Kulman Ghising confirmed the signing of a bilateral investment agreement in regard to the Butwal-Gorakhpur 400 KV transmission line. He was speaking to the media from New Delhi, India. The transmission line is related to the US aid project Millennium Challenge Corporation (MCC) as well.

The line to be originated from Nanglebhare of Kathmandu will reach Butwal to get connected with a substation to be built there. It will reach Gorakhpur via the same substation. NEA Executive Director Ghising and Power Grid’s Executive Director Y K Dixit signed on the agreement from their respective sides amidst a program in New Delhi, India.

The August 3 meeting of the Council of Ministers had granted permission to the NEA to invest for 50 per cent share for establishing a company for the construction of the section of the transmission line to be developed towards India.

Executive director Ghising said the signing of the agreement opened the way for the establishment of a joint company with 50-50 per cent share of NEA and Power Grid of India for the construction of the transmission line project. The Butwal-Gorakhpur inter-country transmission line is 120 kilometers long. Of this distance, 20 kilometres lies towards Nepal while 100 kilometres is towards India.

Nepal itself will construct the section of the transmission line on its side while the section towards India would be built by the company to be set up through 50-50 share ownership of NEA and Power Grid. The transmission line can transmit about 2,000 megawatts electricity, NEA’s Power Trade Department Director Prabal Adhikari said.

According to him, the Butwal-Gorakhpur transmission line can transmit nearly double power than the existing first inter-country 400 KV Dhalkebar-Mujaffarpur transmission line can transport. The Butwal-Gorakhpur transmission line will prove to be the lifeline for power trade between the two countries, he added.