India, Nepal Energy Bank Proposed
28 May 2016
Nepal has forwarded a proposal to set up an India-Nepal energy bank that would help both countries address the problem of power shortage by increasing energy security at a meeting of the India-Nepal Joint Standing Committee, which concluded on 30 May 2016 in Kathmandu, Nepal.
The energy bank would enable Nepal to export electricity to India during summer and import electricity from India during winter, when generation capacity of its hydropower plants drops sharply, leading to crippling power shortages throughout the country.
India is agreeable to the concept, but has to work on several regulatory provisions, according to reports.
In 2014, India Prime Minister Narendra Modi signed a Power Trade Agreement with Nepal, paving the way for bilateral trade of electricity between the two countries.
The India-Nepal Joint Standing Committee is a bilateral mechanism on water resources, power, and irrigation projects.
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