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Financial closure for SJVNL’s hydro project in Nepal

Shimla, Feb 6 (IANS) The financial closure of the 900 MW Arun-III hydro power project in Nepal was achieved on Thursday, the executing company said here.

The total debt tied up with banks is Rs 6,333.48 crore that includes Rs 1420.86 crore stand-by line of credit, if required, the Satluj Jal Vidyut Nigam Ltd (SJVNL) said.

The debt portion of Indian banks is Rs 5,374 crore, while Nepalese banks have Rs 960 crore.

The financial Closure is a stage of project development when all the conditions of a financing agreement are fulfilled prior to the initial availability of funds by the financers.

The SJVNL Chairman Nand Lal Sharma said the company would be investing approximately Rs 6,959 crore in Nepal in five years. The total financial benefit up to handing over of the project to the Nepal government is estimated to be around Rs 21,166 crore.

The financial closure will ensure realisation of 70 per cent of the funding in the form of structured debt while the remaining will be direct equity from SJVNL.

As on date, investment of around Rs 875 crore has already been made.

Sharma said that the project is helping in socio-economic growth by generating employment opportunities for locals, boosting local industries, and fostering entrepreneurship and development of infrastructure such as roads and bridges and providing financial support for healthcare facilities and community centres.

SJVNL is a joint venture between the central and the Himachal Pradesh governments, where the former holds 74.5 per cent stake, while the remaining 25.5 per cent is held by the state government.

However, the central government sold 10 per cent equity in May 2010.

–IANS

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