The Bhutan Government has turned down proposals of Indian private power companies wanting to set up projects in the country.
It is learnt that Bhutan first wants to complete 10,000 MW projects with Indian Government-nominated agencies before allowing any private companies to set their roots in Bhutan.
“In Bhutan things are difficult. There is first a commitment of 10,000 MW to Indian Government. Unless that is resolved, they cannot really give it to anybody,” said a Chief Executive of private power company, who was recently in talks with the Bhutan Government.
Meanwhile, it is also learnt that Bhutan wants that projects taken up into the country, be backed by the Indian Government, irrespective of the type of project; project by a State-owned entity or private sector entity.
Four Bhutanese rivers – Torsa, Wangchu, Sankosh and Manas – are estimated to have more than 23,760 MW hydro-power generation potential.
Companies such as Tata Power were planning to expand in Bhutan. Currently, the Tata Group firm has a joint venture with Druk Power, an entity of the Royal Government of Bhutan, under which it is implementing the 126-MW Dagachhu Hydro Project.
Analysts say that the private participation in Bhutan’s joint venture projects would assist in fast commissioning of the hydro plants. However, the Government has so far not taken any steps to rope in private companies for implementing projects in Bhutan.
The bilateral projects set up with Bhutan are funded through grants and long-term loans from India. Also, the electricity generated is purchased by an agency nominated by India.