The government has made it clear that the 300-MW Upper Karnali Hydro Electricity Project (UKHEP) was awarded to the Indian company GMR Consortium as per the decision made by the then-parliamentary committees comprising the representatives of all parties including the UCPN (Maoists).

Maoist cadre had protested against the construction of the project in Dailekh a month back stating that the decision to award the project to GMR was done without proper consultations with the local people who have their rights over the resources.

Speaking during a meeting of the Natural Resources and Means Committee held on Thursday, Minister for Energy Prakash Sharan Mahat said, “It is the government's duty to follow the decision made by the parliamentary bodies. The government acted upon the directives of the parliament committee and agreed to award the project to the Indian company earlier.”

Mahat also urged the concerned authorities and the protesting parties to stop the protest programmes and not to halt the construction of the hydro projects at a time when national and international investors are keen to invest in this sector. “Keep the projects far away from party politics and work for the welfare and prosperity of the local people and the country,” he said. 

A working finance committee formed to evaluate the financial and technical capabilities of the proposals for the projects and led by the former finance secretary Bhanu Prasad Acharya had recommended GMR's name as first choice to award both UKHEP and Arun III (600 MW) through an international bidding process. 

Similarly, the Committee on July 17, 2007, had issued a four-point directive to the government to award a single project to single investors unlike the recommendations of the committee led by Acharya.

During the meeting, Maoist lawmaker Satya Pahadi challenged Mahat to show the name of the then-Maoist leader who signed the agreement and also the details of the agreement signed for the project. Mahat said, “Both the finance committee and parliament committee formed to look at the project proposals had representatives of the Maoists.”

Meanwhile, various Maoist lawmakers, namely Shiv Raj Gautam, Lokendra Bista, Bharat Kumari Regmi and Mohan Bahadur Khatri among others, urged the government to scrap the decision, which, according to them, must be passed by a two-third majority of the Parliament.

However, minister Mahat said that the government has 27 percent shares in the project and there is no need to ratify the decision by the Parliament again.

The project will provide Nepal 108 MW of free energy, Rs. 360 million for the next 15 years, and Rs. 1 billion annually afterwards as royalty.