We will create conducive mechanisms for more foreign investment – Minister Gyawali  

KATHMANDU (29 June 2018) – With our neighbours, we work together to take our relations to newer heights on the basis of equality, mutual trust, respect and benefit. Creating win-win situation would guide us in our pursuit for harnessing of Nepal’s water resources.

Read the full text of his address  at the Seminar on Development Strategy for the Water Resources Management in Nepal, organized by the Association of Former Career Ambassadors of Nepal


  1. I would like to thank, at the outset, the Association of Former Career Ambassadors of Nepal for inviting me to attend this seminar on “Development Strategy for the Water Resources Management in Nepal”. I appreciate AFCAN for taking this noble initiative. I found the theme of the seminar highly relevant as it covers an important aspect of Nepal’s national priority area. I am sure that the deliberations made during the seminar would be helpful in generating insights into the subject matter and providing policy inputs.


Ladies and Gentlemen,


  1. Nepal is rich in water resources. With more than 6,000 rivers, we have abundant opportunity to harness this precious resource for the benefit of our people in all provinces of the country in an equitable manner.


  1. We have been attaching high importance to water resources as a major contributor for the socioeconomic development of Nepal. Our plans and policies have always prioritized this sector and we have also utilized external assistance to a greater extent. However, we have not been able to achieve the desired results. If we compare the vast potential with the current use, a large gap becomes apparent.


  1. With the increasing population and effects of climate change, water resources sector is likely to encounter more challenges in coming days. Himalayan mountains and glacial lakes are melting. Rivers are getting polluted. The ecosystem has been adversely affected. Our objective of achieving SDGs by 2030 largely depends on the prudent utilization of our water resources. In this context, I am happy to share that in order to conserve our water resources for us as well as our posterity; the government has initiated the programmes of climate change mitigation and adaption. Protection of Himalayan mountains and glacial lakes that are the source of fresh water as well as river basin protection remains our top priority.


  1. We can do a lot to tap the full potential of water resources with timely measure. There is a need to have a focused strategy and a comprehensive national water policy. The sustainable development of water resources can substantially contribute to improve the livelihood of our people as well as enhance the economic growth of the country. As agriculture traditionally remains a major source of livelihood and employment with 27.6 percent contribution to the GDP, utmost utilization water resources holds much significance for the advancement of this sector.


  1. In the context of our federal set up, proper utilization of water resources would enhance the efficiency of the provinces and local levels. Judicious use and distribution of benefits of this resource would be a priority of the federal and local governments in the days ahead. The Constitution is clear about the responsibility of federal, provincial and local governments in the utilization and management of water resources. Institutional arrangements need to be made in federal and provincial levels for the management of water resources related issues. Legal framework would also be essential to regulate these aspects. The Government of Nepal is contemplating a water resources policy to guide our future course of action in this sector.


Ladies and Gentlemen,


  1. The Government has identified energy as a driver of economic growth. We have vast hydropower potential with about 43000 MW considered to be economically viable to harness. This definitely provides us opportunity to fulfill our needs as well as that of our neighbours. Major investments of the public, private and cooperative sectors will be concentrated in the generation of hydropower. Foreign investment and resources from the development partners will also be mobilized in this sector. Non-resident Nepalis will be encouraged to utilize their capital. With the promotion of electricity-intensive industrial activities, we can create congenial atmosphere for further hydropower generation. This will also help achieve balanced regional development. We will create conducive mechanisms for more foreign investment.


  1. Given the vast energy potential of Nepal, the Government envisages to generate 5 thousand megawatts of electricity within 5 years and 15 thousand megawatts within 10 years from small, medium and large hydroelectricity projects through the investments of public and private sectors.


  1. Trade of hydroelectricity with neighbouring countries equally remains our priority. The Power Trade Agreement signed between Nepal and India in 2014 holds promise in facilitating cooperation in the power sector, including developing transmission interconnections, grid connectivity, power exchange and trading. This has provided a solid ground for the free export of power from Nepal to India. The Indian side has issued guidelines on cross border trade of electricity. We consider that certain provisions of the guidelines contradict with the PTA. During the recent high level visits, the Indian side informed that it is reviewing the guidelines in line with the PTA and our suggestions. An MoU on Energy Cooperation has also been signed with China during the recent visit of the Rt. Hon. Prime Minister to China.


  1. Nepal has been importing power from India to meet our energy deficit. Soon we will be in a position to export power to India. With the construction of New Butwal Gorkhapur cross border transmission line, the trade of electricity will be firmly institutionalized. The concept of power banking is also being examined between the two countries to explore the opportunity created by the seasonal complementarities.


  1. Besides bilateral arrangements, we can also benefit from trilateral initiatives. Bangladesh has expressed interest in investing in the hydropower projects in Nepal as well as buying the electricity from us. We are exploring the possibility of having a trilateral arrangement to materialize it.




Ladies and Gentlemen,


  1. Equally important is the utilization of water resources for irrigation. Ensuring irrigation facility for all irrigable land within 5 years is our target. Nonetheless, use of rivers in Nepal is not limited to hydropower generation and irrigation. We can also use them for cultural and recreational purposes. This can also become a major attraction for foreign tourists given the fact that we are celebrating the year 2020 as the Visit Nepal Year.


  1. It appears that in the past there was an approach on developing isolated projects of hydropower, irrigation, drinking water and flood control focused only on supply side without much attention to environmental and social impact. This resulted in unsustainable pattern of development. Our approach should be on the basin wide development of water resources. The lives and livelihoods of vast population depend on the optimum utilization of water resources. Economic development, food security, and upliftment of living standards of people are inextricably linked to this.


  1. While utilizing water resources, the government will develop multipurpose projects including electricity, irrigation, drinking water, river training and environmental protection. Collaboration with provinces and local levels including the participation of the community will be the modality of operation. Projects will be implemented along with celebrating the period of 2018-2028 as the Energy Decade.


Ladies and Gentlemen,


  1. Developing inland waterways is an important aspect of our vast water resources capacity. This should be an integral part of our water resources plan. Given our landlocked status, it is important not only for movement of people but also for expansion of trade and utilization of transit of goods. All rivers of Nepal drain into the Ganges system. As India has been developing waterways in Ganga River from Haldia to Allahabad, our connection with this would be important for us. During the visit of the Rt. Hon. Prime Minister to India in April 2018, it was agreed by the two sides to develop the inland waterway for the movement of cargo, within the framework of Trade and Transit arrangement, providing additional access to sea for Nepal. Our officials are engaged at technical level to advance this connectivity.


  1. We are working with India for the implementation of all the agreements and understanding reached in the past. The bilateral mechanisms in water and energy sectors would now meet regularly. Outstanding matters would be addressed by September 2018. Advancing cooperation in areas such as river training works, inundation and flood management, and irrigation have been prioritized. In order to address the problem of inundation in the southern areas of Nepal, a joint team of experts is currently carrying out studies in the affected areas. It would suggest appropriate measures for sustainable solution to the problem.


  1. Early finalization of the DPR of the Pancheshwar Multipurpose Project is essential to gain mutual benefits in the areas of energy, irrigation and flood control. In this context, a joint Team of Experts/Officials is working to finalize the DPR.


  1. Two mega projects – Arun III and Upper Karnali are being developed with Indian investment. To ensure completion of these 900 MW projects within specific timeframe, implementing agencies of both the countries are working in close cooperation and coordination.


  1. Our teams are also engaged for the early start of construction works of head regulator with the agreed sill level and link canal from Tanakpur Barrage to the Nepali side. With this, Nepal will receive water for irrigation as per the Mahakali Treaty.


  1. With our neighbours, we work together to take our relations to newer heights on the basis of equality, mutual trust, respect and benefit. Creating win-win situation would guide us in our pursuit for harnessing of Nepal’s water resources.


Mr. Chairperson,


  1. In the end, I believe that the thoughts and ideas that this seminar generate will make significant contribution to enrich the discourse on water resource management and development in Nepal and thereby help the government and all stakeholders to take timely measures and initiatives to tap the maximum benefit from this sector for Nepal and Nepalis from economic, social and environmental perspectives. Importantly, proper and sustainable utilization of water resources would significantly contribute towards fulfilling our long-term vision of creating “Prosperous Nepal, Happy Nepalis”. I wish this seminar a great success.


Thank you.

Note – Keynote Address by The Hon’ble Pradeep Kumar Gyawali, Minister for Foreign Affairs, at the Seminar on Development Strategy for the Water Resources Management in Nepal, organized by the Association of Former Career Ambassadors of Nepal

Kathmandu, 29 June 2018


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