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New Delhi, Sept. 17 India has managed a breakthrough in its hydropower diplomacy in the South Asian region, with State-owned hydropower major NHPC Ltd inking a pact with the Myanmar Government for development of two hydel power projects on the Chindwin river basin.

Under the memorandum of understanding, NHPC would play a lead role in developing the 1,200-MW Tamanthi project and the 600-MW Shwzaye project in Myanmar, marking India’s debut in harnessing hydel resources in Myanmar.

The MoU was signed by Mr S.K. Garg, NHPC’s Chairman and Managing Director, and Mr U. Win Kyi, Director General, Ministry of Hydropower, at Nay Pyi Taw in Myanmar on Tuesday.

“This marks an entry for Indian utilities into Myanmar. Tapping the hydropower resources along the river Chindwin on the Indo-Myanmar border is of strategic importance, besides the obvious economic benefits,” the Minister of State for Power and Commerce, Mr Jairam Ramesh, said.

Under the pact, once a final decision on proceeding with construction is taken, a joint venture agreement is set to be concluded between the two sides, when the project cost estimates would also be firmed up.

Besides this initiative, in a step towards ramping-up its play in the South Asia rim, India had earlier extended a $64-million line of credit for three important transmission projects to be undertaken in Myanmar. The credit is being extended by the Exim Bank, which signed the line of credit agreements with Myanmar Foreign Trade Bank.

Mr Ramesh said that Power Grid Corporation of India Ltd would take up the construction of all the three transmission projects. He said another $60 million credit was being extended by the Indian Government for setting up a 120-MW Thatay Chaung power project on the river Thatay Chaung.

India has also agreed to rebuild the Sitwe port in Myanmar at a cost of $120 million.

It will be a ‘Build, Transfer, and Use’ project, the first of its kind, and will be financed by a grant by the Indian Government. The project involved three major components — rebuilding the port, making the Kaladhan River navigable up to Mizoram, and developing highway connectivity from the border in Mizoram.

Mr Ramesh said that the Sitwe project assumed significance in the Centre’s plan to develop the North-Eastern States, which lacked connectivity in trade. The Myanmar port would provide an alternative route for the region to connect with South-East Asia, he said.

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