WAPCOS to prepare DPR for Bhutan hydel project

The Hindu, Wednesday, Mar 03, 2004

KOLKATA, MARCH 2. The Union Ministry of External Affairs has appointed Water and Power Supply Consultancy Services (WAPCOS), a Central Government undertaking, to prepare a detailed project report (DPR) on the proposed 870 MW Punatsangchu hydroelectric power project in Bhutan. The DPR scheduled to be prepared before January 2006, will be the first step before India decides on financing the same at an estimated cost of $813 million. It may be mentioned that India and Bhutan had entered into a memorandum of understanding regarding Phunatsangchu following a request for investment from the King of Bhutan, Jigme Singye Wangchuck, during his visit to India in September 2003.

Apart from Phunatsangchu, the King had also requested India to take up 360 MW Mangdechhu project requiring an investment of $349 million. The single largest investing country in the power sector in Bhutan, India has already commissioned the 336 MW Chukha Hydro Project Corporation (1988) and 45 MW Kurichhu hydroelectric project costing about $319 million. The Bhutanese power sector, now contributing about 45 per cent of gross revenue of Bhutan, would be further boosted with the commissioning of the 1020 MW Tala hydroelectric project (THPA) in 2004-05. The revised estimated cost of the project, which had suffered due to landslide, had gone up to $750 million from $600 million. India offered 60 per cent of the project cost as grant and the balance as soft loan to Bhutan.

The investment in the Tala project had followed the incorporation of Tala-Delhi Transmission Ltd (TDTL), the first ever public-private partnership in power transmission in India. TDTL is a joint venture between the Tatas and the Power Grid Corporation of India (PGCIL). Apart from India, Austria had also committed investment in hydel power generation in Bhutan. The Phase-I (22 MW) of Basochu hydro power project has already been commissioned through bilateral assistance and soft loan finance by the Austrian Government. Phase-II (40 MW) of the same project is now under implementation.

Pursuing a policy to tap the full potential of 30,000 MW hydel power, Bhutan had already witnessed a positive balance of payment position with India since 1996 due to export of power. "Water is to us what oil is to Arab," the Bhutanese King told the Indian media during his last visit.