The World Bank extended a loan of USD 20 million to Nepal for the Power Sector Reform and Sustainable Hydropower Development Project.

Issuing a press statement from its Washington DC-based headquarters, the Bank said the credit is offered in order to “help strengthen the capacity of power sector agencies in Nepal to plan and prepare hydropower generation and transmission line projects along international standards and best practice.”

It hoped that the project would also help improve the readiness of power sector agencies to undertake regulatory as well as institutional reforms.

“Reforms initiated under this project will underpin the agenda of transformational hydropower development that the World Bank Group intends to support in Nepal over the coming years,” the statement quoted Julia Bucknall, Practice Manager for Energy and Extractives at the World Bank, as saying. “This project will help identify and address key challenges that stand in the way of Nepal achieving its full potential in the power sector.”

Likewise, the Bank’s Nepal Country Manage Takuya Kamata said “This project benefits from the inputs of a wide range of knowledgeable stakeholders which we hope can help define a broadly owned vision for hydropower development in Nepal.”

According to the bank, the first component of the project will support preparations of the Upper Arun Hydroelectric Project and the Ikhuwa Khola Hydroelectric Project.

It will also support the preparation of transmission line projects to be identified by the ongoing Transmission System Master Planning, the statement added.

Likewise, the second component will finance studies and propose policy recommendations critical for power sector reforms.

Similarly, the third component will support capacity building for safeguards management and sustainable hydropower development.