Nepal and China have proposed to ink a memorandum of understanding to have a power trade agreement during the next high-level political meeting between the two countries.

Nepal has already signed a power trade pact with India which has facilitated the purchase of power between the two countries.

According to a news report of The Himalayan Times, Nepal has also proposed a similar PTA with Bangladesh. “The purpose of PTA with China and Bangladesh is to facilitate exchange of power among the three countries as is happening between Nepal and India” Spokesperson for the Ministry of Energy, Water Resources and Irrigation Dinesh Ghimire told THT.

According to the ministry, the aim of the proposal is to sell Nepal’s surplus power to its neighbours. Nepal expects to have surplus power in a few years. Nepal has been buying more energy from India during winter but selling less amount of energy to India in the summer when it has surplus power.

As per the energy assessment of MoEWRI, Nepal will have surplus energy within a few years. “We have already finalised MoU between Nepal and Bangladesh. It will be signed at an appropriate time,” Ghimire said. “We can sell surplus power to three countries and buy from them when we need it.”

China had agreed to provide technical assistance to Nepal on feasibility study of Rasuwagadhi-Kerung 400 KV cross border transmission line when Prime Minister KP Sharma Oli visited China during his first tenure as PM.

Nepal’s private sector has been pressing the government to sign a PTA with China on the lines of its agreement with India.

According to Ghimire, the cross border transmission line could be built from Rasuwagadhi in Rasuwa, Kimathanka in Sankhuwasabha, Tatopani in Sindhupalchowk and Korala in Mustang on the Nepali side.

The MoEWRI has already finalised the MoU after consulting the Chinese government and it has sent it to the Ministry of Foreign Affairs, said Ghimire. “It will be signed during a high-level visit from China or Nepal,” Ghimire said. “The draft MoU was exchanged between authorities of both countries before finalising it.”

Nepal and China have agreed to form a joint steering committee led by MoEWRI secretary and his Chinese counterpart. Both sides have also drafted MoU to form a Joint Working Group led by joint secretaries of both countries. “Working group will provide technical support to the steering committee,” Ghimire said.

According to Ghimire, both committees will work to expedite hydropower development and trade in both countries after an MoU is signed with China. According to the draft MoU, Nepali civil servants can visit China to observe its hydropower development and Chinese authorities can also visit Nepal.

China has shown interest in building Rasuwagadhi-Galchhi transmission line. It will help build the 12MW Budhigandaki Hydropower Project on time and get surplus energy.