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Post at: Aug 17 2021

Lower Arun Hydro Electric Project

Why in News

  • Recently in July 2021, Nepal has signed a USD 1.3 billion deal with India's hydropower major Satluj Jal Vidyut Nigam (SJVN) to develop a 679-megawatt hydropower project in eastern Nepal.


  • This will be the second mega venture in Nepal undertaken by India.
  • It is based on 2017 cost entimates. 
  • This hydropower project will be developed under Boot model (Build Own, Operate and Transfer model).
  • It is the single largest foreign investment project.
  • It is located between Sankhuwasabha and Bhojpur districts in eastern Nepal.
  • A memorandum of undertanding for this project was signed by the Investment Board of Nepal Chief Executive Officer Sushil Bhatt and SJVN Chairman and Managing Director Nand Lal Sharma.

About Lower Arun Hydro Electric Project

  • This project has the capacity of 679MW of electricity
  • The lower Arun Hydro Electric Power is located in Sankhuwasabha, and Bhojpur Districts of Nepal.
  • The Project will not have any reservoir or dam
  • It will be a tail race development of 900 MW Arun 3 HEP.
  • The project will have four francis type turbind.
  • It will generate 2970 million units of electricity per annum after completion.


  • The foundation stone of the Arun 3 project was jointly laid by Prime Minister of India, Shri Narendra Modi and Prime Minister of Nepal Shri K.P. Sharma Oli at Kathmandu on May 11th 2018.
  • Arun 3 HEP is the largest project in Nepal and also the largest investment of around INR 7000 crores by India in Nepal

Aim of this Project

  • SJVN'S present installed capacity is 2016.51 NW and aims to be 5000 MW company by 2023, 12000 MW company by 2030 and 25000 MW Company by 2040.

A Path Forward

  • The commissioning of this project will go a long way in fostering friendship between the two neighbours. It will also lead to accelerated development and economic revival of Nepal. Therefore it will strengthen so called Roti-Beti relationship in our Indo-Nepal relationship.

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