POST REPORT

KATHMANDU, Nov 8 - The Indian government has agreed in principle to build the 240 megawatt (MW) Naumure, a storage type hydropower project located in West Rapti River, at the border between Dang and Pyuthan districts, on grant basis for Nepal. On his return to Kathmandu Wednesday after cutting short his stay in India, Deputy Prime Minister K P Sharma Oli said that India has also agreed to expedite work to prepare detailed project report (DPR) of the 6,480 MW Pancheswore, which has not moved ahead 10 years after Nepal ratified the Mahakali Treaty.

"The Indian government has also agreed to play the role of facilitator in encouraging Indian investment in Nepal's hydropower, tourism, and agriculture sectors," Oli said while talking to journalists at Tribhuvan International Airport. India is also positive about railway and link road expansion, and has agreed to provide 10,000 metric tons of chemical fertilizer immediately on subsidy. Similarly, Indian government informed Oli that steps are already being taken to renew the Nepal-India Commerce Treaty which is expiring in March next year, and assured that the 10-year agreement for cooperation in agriculture signed by the two countries in 1991 would be renewed.

India is positive on waiving of additional customs duty on additional 123 Nepali items exported to India. Similarly, with regard to Nepal's request to rethink the policy of 85 percent soft credit line coming in the form of material and service, India assured that projects undertaken with the credit would have participation from both Indian and Nepali sides.

During his visit, Oli met with Indian Prime Minister Manmohan Singh, Foreign Minister Pranab Mukherjee, leader of the opposition party Lal Krishna Advani, CPI (M) General Secretary Prakash Karat, and CPI General Secretary A B Bardhan, among others. During his meeting with Mukherjee, Oli discussed the implementation of the agreements, especially on financial assistance, reached during Prime Minister Girija Prasad Koirala's India visit. He asked Mukherjee to encourage the Indian private sector to invest in Nepal's hydropower, health, tourism, information technology and industrial sectors.

Source: The Kathmandu Post, 9 November 2006