Nepal and Bangladesh on Friday agreed to jointly develop hydropower plants, transmission lines and build capacity for the two countries' energy sector.
Nepal's Energy Minister Barsha Man Pun and Bangladesh’s State Minister for Power, Energy and Mineral Resources, Nasrul Hamid, signed the agreement on Friday after a two-day meeting in Kathmandu.
Nepal and Bangladesh import power from their neighbor India, with whom the two countries have rocky relations. But Dhaka in recent years has reached out to Nepal, and is capable of potentially generating at least 40,000 megawatts (MW) of hydropower to meet its growing energy needs.
“This (the agreement) has opened up a new door for the development of the hydropower sector in Nepal,” Pun said after the signing of the deal.
“We discussed investments from both governments as well as the private sector in the area of hydropower in Nepal. We are also keen to collaborate on solar energy, a sector in which Bangladesh has made progress,” he said.
While the minister said Dhaka was interested in importing 500 MW of hydropower electricity from Nepal, he added that it was critical that India be involved in the construction of transmission lines between Nepal and Bangladesh.
Nepal signed a power trade agreement with India in 2014. The country also signed an agreement with China on energy cooperation last year. Friday’s energy cooperation agreement with Bangladesh is the third energy deal the country has struck with its neighbors.
Pun said the delegates from three countries would discuss energy cooperation on Aug. 30 in Kathmandu during the summit of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), a regional grouping of seven countries.
By Deepak Adhikari in Kathmandu, Nepal