Bangladesh and India are negotiating two memorandums of understanding (MoUs) and two power purchase agreements (PPAs) for signing during Prime Minister Sheikh Hasina’s upcoming visit to India scheduled for April 7-10.
India wants to sign two tripartite MoUs on power sector cooperation—- one with Bangladesh and Bhutan and another with Bangladesh and Nepal during the premier’s visit.
As per the primary negotiations, Bhutan, Bangladesh and India will set up an 1125MW joint-venture plant ‘the Kuri-1 hydropower plant’ in Bhutan as proposed by the Bhutanese government.
Bhutan has already sent a draft of the MoU on the proposed trilateral cooperation to Bangladesh and India. Bangladesh has confirmed its concurrence to the draft.
The trilateral deal might be signed during the PM’s visit to India if the Indian government would agree to allow establishing a dedicated transmission line for supplying power to Bangladesh from the proposed power plant.
India, however, is interested in signing the MoU before carrying out discussion on dedicated transmission line issue, officials said.
Prime Minister Sheikh has already shown her government’s interest to invest $1 billion for implementing the joint-venture project with Bhutan and India.
Besides, another MoU is likely to be signed for setting up a hydroelectric power project having the capacity to generate 500MW of electricity in Nepal with support from Indian firm GMR. Bangladesh also sought dedicated transmission line for implementing the project.
Besides, Bangladesh also discussed the issue of signing a power purchase agreement (PPA) for importing 340MW of electricity from Assam. India wants to sign the deal before fixing the tariff.
Bangladesh had already faced additional tariff burden for importing 100MW of electricity from a power plant at Palatana in Tripura.
India showed interest to sign another power purchase agreement with Bangladesh for supplying another 60MW of electricity at the tariff same as Palatana.
Dhaka earlier agreed to import 100 megawatts of electricity from Tripura at Tk 6.45 per unit under no-electricity no-pay method. Bangladesh is now importing 250 MW of electricity from Indian public-sector plants at Tk 3.56 per unit, and another 250MW from Indian private power plants at Tk 4.36 per unit.
During premier’s visit to India, the government is likely to seek tax exemption facilities for importing electricity from India. Import of another 500MW power is under process and Dhaka is interested in importing more electricity from India.
Bangladesh is one of the signatories of SAARC Framework Agreement for Energy Cooperation (Electricity) and the MoU for the establishment of the BIMSTEC grid interconnection. These two agreements promise free exchange of electricity in this region.