New Delhi: The Cabinet Committee on Economic Affairs on Wednesday approved the investment of Rs 4,526.12 crore for the 540 MW Kwar Hydro-electric project located on Chenab River in Jammu & Kashmir's Kishtwar district.
This is part of the Indus basin and would be one of the at least four projects coming up in the district, including the 1,000 MWs Pakal Dul hydroelectric project and 624 MWs run-of-the-river Kiru hydroelectric project.
Under the 1960 vintage Indus Water Treaty (IWT) between India and Pakistan, the two countries share the waters of six rivers in the Indus basin that flow through India towards Pakistan. Of these, India has complete rights over three eastern rivers - Sutlej, Beas and Ravi, while Pakistan has rights over the western rivers - Chenab, Jhelum, and Indus.
India can, however, build run-of-the-river projects on the western rivers. Over the last five years, the government has been on approval and construction spree to fully tap the potential in the Indian side of the Indus basin.
The Kwar hydropower project will be implemented by Chenab Valley Power Projects Private Ltd (CVPPL), a joint venture company between NHPC Ltd and Jammu & Kashmir State Power Development Corporation (JKSPDC) with equity contribution of 51 per cent and 49 per cent respectively.
The project shall generate 1,975.54 million units in a 90 per cent dependable year.
"Government of India is extending a grant of Rs 69.80 crore towards the cost of enabling infrastructure and also supporting the Union Territory of Jammu & Kashmir by providing grant of Rs 655.08 crore for Equity contribution of JKSPDC (49 per cent) in VPPPL. NHPC shall invest its equity (51 per cent) of Rs 681.82 crore from its internal resources," it was announced after the Cabinet Committee on Economic Affairs (CCEA) meeting.
The Kwar Hydro Electric Project shall be commissioned within a span of 54 months, the government said, adding: "The power generated from the project will help in balancing the grid and will improve the power supply position."
In order to make the project viable, the government of UT of J&K will be extending 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 at 2 per cent per year in a decremental manner, i.e. the free power to the Union Territory of Jammu & Kashmir would be 2 per cent in the first year after commissioning of the project and thereafter shall increase by 2 per cent per year and shall be 12 per cent from the sixth year onwards.
The construction activities of the project will result in direct and indirect employment to around 2,500 persons and will contribute to overall socio-economic development of J&K.
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