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India, Nepal sign major deal in power sector

Virender Mohan and Deepak Goel in Kathmandu

India and Nepal on Thursday turned a new leaf in their bilateral relations when they signed an agreement to promote private sector participation in the Himalayan kingdom's hydro power projects.

They also signed a memorandum of understanding increasing by 50 per cent the seat capacity in each other's airlines.

The two sides exchanged instruments of ratification on the Mahakali treaty for the joint exploitation of Nepal's abundant water resources.

These landmark agreements were signed shortly after Prime Minister Inder Kumar Gujral's arrival in Kathmandu on a three-day official visit, his first after assuming office.

The power trade agreement was signed by Minister of State for Power S Venugopalachari and Nepali Minister of State for Water Resources Rajiv Parajuli in the presence of Gujral and Nepal Prime Minister Lokendra Bahadur Chand.

The agreement, initialled earlier at Bombay at the secretaries level in February 1996, will facilitate the entry of the private sectors of both countries in the sale and purchase of power.

UNI