by Hari Prasad Shrestha 28 December 2023
During the 1980s, Ethiopia was considered to be a country, full of poverty and underdevelopment and ranked as the poorest countries in Asia and Africa. By the time, it was portrayed as a country of famine and hunger, while Nepal was economically performing better. However, after the 2000s, the situation completely reversed and Ethiopia developed as fast growing economies, catching up to countries representing middle-level economies. Nepal remained where it was àt the bottom of least developed country; only one example would be more than enough to clarify this statement.
The Ethiopian Government surveyed the Grand Ethiopian Renaissance Dam (GERD) site in October 2009 and in November 2010, a design for the dam was submitted by James Kelston. The dam’s foundation stone was laid on 2 April 2011 by the Prime Minister Meles Zenawi. In November 2012, Ethiopia began construction of the dam, a 6000-megawatt hydroelectric project on the Blue Nile river and electricity generation began in February 2022.
For the construction of a similar capacity of hydro electricity project, the Government of Nepal and the Government of India signed a treaty in 1996 on the Integrated Development of the Mahakali Barrage Including Sarada Barrage, Tanakpur Barrage, and Pancheshwar Project to produce 6480 MW (3240 MW in Nepal side and 3240 MW in India side) of electricity in border Mahakali river including irrigation and flood control purposes. If we compare this project with the Ethiopian dam project, which started to produce electricity after 12 years of its survey, the Pancheshwar project is lingering in DPR for three decades, which was supposed to be completed within six months of the treaty signed.
According to power experts in Nepal, the motto of this treaty appears to reconfirm and give legal status to Tanakpur barrage for irrigation purpose of India, which it had constructed earlier occupying some part of Nepal, without permission of Nepal. To calm down the opposition in Nepal regarding the construction of Tanakpur Barrage, India initiated a new huge multipurpose project including old Tanakpur Barrage under the new integrated development of Mahakali barrage treaty with the objective to hold the project for indefinite period on Mahakali River until it feels necessary to initiate it’s construction.
Some experts on regional geopolitics say that India executed hydro projects in Nepal including the Pancheshwar project are of high significance for it in view of China’s growing influence in Nepal. In fact, the Indian government has already been using large-scale transboundary hydropower projects as an efficient tool for diplomacy in South Asia by restricting entrance of other countries in the region, especially China.
However, the implementation of the project seems to be full of controversies and roads ahead are not so easy even if both the countries are finalized to start construction of the Pancheshwar project. For example, both Uttarakhand of India and Sudur Paschim of Nepal regularly witness extreme weather events and it is also home to the fragile part of the Himalayas. The project site is also an earthquake-prone area. It is risky, unviable, unsustainable and a highly disaster-prone area – over the years has faced many extreme weather events. These areas experienced a number of earthquakes of magnitude more than six on the Richter scale. Moreover, landslides, forest fires, cloudbursts and high-intensity rainfall leading to floods are among the other problems faced by the state. In June 2013, severe floods in Uttarakhand resulted in deaths of over 5,000 people and damaged property worth billions of rupees.
India has had a history of public protests against such huge projects. For instance, when India’s current tallest dam, Tehri, was being constructed, there was a people’s movement against it in the 1980s and 1990s. In another example, the protest against another large-scale project in the country, the Sardar Sarovar dam on the River Narmada, still continues.
It would be relevant to note here that Ethiopia completed the project in time even Sudan and Egypt, voiced their concerns over a potential reduction in water available. The Blue Nile, where the dam project has been constructed is vital to the livelihood of Egypt: as the most significant tributary of the Nile, it contributes over 85% of the Nile’s streamflow.Though shorter than the White Nile, 59% of the water that reaches Egypt originates from the Ethiopian highlands via the Blue Nile.
Another significant aspect of the GERD is that Ethiopia completed this with a major share of domestic funding with a small portion outside investment, which can’t be imagined in Nepalese perspective. The dam was estimated to cost close to 5 billion US dollars, about 7% of the 2016 Ethiopian gross national product. The lack of international financing for projects has persistently been attributed to Egypt’s campaign to keep control of Nile water sharing. Ethiopia has been forced to finance the GERD with crowdsourcing through internal fundraising in the form of selling bonds and persuading employees to contribute a portion of their incomes. Contributions were made in the official website confirmed by the verified account of the Office of the Prime Minister of Ethiopia. Of the total cost, 1 billion US dollars for turbines and electrical equipment was funded by the Exim Bank of China. As far as cost of the Pancheshwar project is concerned as DPR for the project is under negotiations between India and Nepal, and without finalization of DPR, it would be difficult to ascertain the project cost. However, even if we estimate the cost for the Pancheshwar project, more or less US$ 5 billion, equivalent to the GERD project, Nepal should bear the half of electricity generation cost and proportional cost based on use of irrigation and flood control.
Even after a century’s effort to produce under 5% of its hydro power potential is not an encouraging signal from a national development perspective in Nepàl. Nepal’s hydropower trade is bound to be dependent solely on the interest of India. As this engine of growth for the economy of Nepal is moving at snail’s pace with limited power production due to difficulties in trading with countries other than India in South Asia and India lately realized to import electricity from Nepal. The real problem is the lack of political consensus and trust inside the nation and between nations and the reluctance to deal with energy as a shared opportunity has been a great setback for early enough growth of Nepal’s hydropower sector. For long term trust building measures, as India is facing acute shortage of renewable energy, lack of water for irrigation, and suffering from floods, it must show generosity to fast track the implementation of large power projects in Nepal by learning lessons from the example of early completion of the Ethiopian dam project.