December 03, 2008

JSPL goes to Nepalese Supreme Court over hydel project

IANS reported that Nepal’s hydro power sector, mired in allegations of corruption, is caught up in a legal tangle as Jindal Steel & Power Limited has filed a case in Nepal Supreme Court against an Indian public sector undertaking that outbid it. . It has asked for a stay on the awarding of the contract to Sutlej Jal Vidyut Nigam as well as an order to include it in the selection process.

Responding to the petition, the apex court has asked the government to appear before it on April 23rd 2008 and show cause why the contract was awarded to the Indian PSU Sutlej Jal Vidyut Nigam.

As per report, JSPL has gone to court over the 402 MW Arun III hydropower project that was recently awarded to the Sutlej Jal Vidyut Nigam, in which India’s Himachal Pradesh government has a stake along with the Indian government.

9 companies had bid for the project with Sutlej Jal Vidyut Nigam finally wrapping up the contract after almost three months of negotiations. In the beginning, Sutlej had offered to give Nepal 4.5% free energy but later hiked it up to nearly 22%. The report said that JSPL has questioned the award as its initial offer was at 21%.

This is the second petition in the Supreme Court involving Arun III. In March 2008, a group of Nepali filed public interest litigation against the award of the contract to Sutlej Jal Vidyut Nigam. The petitioners are urging the court to order the government to discuss the project in parliament first since it relates to Nepal’s natural resources.