Chapter

The Nepal–India Water Relationship: Challenges

pp 153-196

Power Trading

  • Santa Bahadur PunAffiliated withNepal Electricity Authority, Government of NepalMinistry of Water Resources, Government of Nepal

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The concept of Indo-Nepal Power Exchange was first broached in BS2006 (AD1950) by the newly arrived ambassador of independent India, Chandreshwar Prasad Narain Singh (CPN Singh), during discussions with Mohun Shumshere, the last autocratic Rana Prime Minister of Nepal. Mohun Shumshere confided (Pande 1982) in CPN Singh of his Rs1.8 crore plan to generate electricity at 6 paisa per unit from the 22 MW1 Gaidakot hydropower-cum-irrigation project in Nawalpur/Nawalparasi by diverting the Kali Gandaki waters through a tunnel. The shrewd Indian ambassador advised Mohun Shumshere that he was making a big mistake as the Indian government was soon executing the large Kosi High Dam Project at Barahchhetra (incidentally inside Nepal) that would avail electricity at 2 paisa per unit for Nepal, North Bihar and Bengal. Mohun Shumshere swallowed this bait and roundly chided the 22 MW project initiators2 for ‘nearly wasting his Rs 2 crores on a useless project!’ Many Nepalese now believe that if this Gaidakot hydropower project of 1950 had been implemented, then this would have done what the 20 MW Chilime has done to the nation 50 years later—mobilise scarce local skills and resources.