The Union Cabinet has given its approval for the investment in the 850-mw Ratle hydropower project in the Union territory of Jammu & Kashmir.
An investment of Rs.5281.94 crore has been approved for the project that will be implemented by a new joint venture to be formed between Central PSU NHPC Ltd (equity: 51 per cent) and Jammu & Kashmir State Power Development Corporation Ltd (equity: 49 per cent). The project is coming up on River Chenab in Kishtwar district.
The Centre is also supporting the Union Territory of Jammu & Kashmir by providing grant of Rs.776.44 crore for equity contribution of JKSPDC in the proposed joint venture.
NHPC shall invest its equity Rs.808.14 crore from its internal resources. Power generated from the Ratle project, to be commissioned within 60 months, will help in providing balancing of grid and will improve the power supply position.
Measures for project viability
The UT of J&K, in order to make the project viable, will extend exemption from levy of water usage charges for 10 years after commissioning of the project, reimbursement of state’s share of GST (i.e. SGST) and waiver of free power to UT of J&K. Free power to the UT will be 1 per cent of the total generation from Ratle hydropower project in the first year of commissioning, rising progressively to 12 per cent in the twelfth year.
Benefits to UT of J&K
Project construction activities will result in direct and indirect employment to around 4,000 persons and will contribute in overall socio-economic development of the UT of J&K, a government release said. The Union territory is expected to gain Rs.5289 crore by way of free electricity over the 40-year project lifecycle, and water usage charges worth Rs.9,581 crore during the same period.
It may be mentioned that in early January 2021, a revised agreement was signed stipulating that NHPC’s equity stake in the proposed joint venture with JKSPDC will never fall below 51 per cent. (Read more).
Featured photograph (source: Wikipedia) shows view of River Chenab taken at Ramban, UT of J&K
