Energy and geopolitics in the Himalayas

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China also wants to connect Nepal to its “new silk road” and meets a lot of positive feedback, but Nepal does not want to rely solely on China, as the example of hydropower shows.

President Xi Jinpings on global reach-scale prestige project, the so-called “Belt and Road”Initiative (BRI), has recently experienced some resistance. The alleged “Win-win”Situation for China and the partner country concerned is questioned according to recent government change in Asia more and more often. Some countries put the question of whether they don’t get in too big of a dependence on Chinese loans, and if not all, Chinese companies and state interests in the foreground.

As expressed by the new government in Pakistan’s reservations, the Land, where the planning and investments for BRI to date on the most progressed and the new government of Malaysia that year, several billion in projects with China; Thailand and Myanmar went on distance to Chinese, Offered, railway lines and ports; and even the small island state of Maldives wants to make following the recent change of power there, the previous agreement with China within the framework of the BRI to the test.

Nepal’s Prime K. P. Sharma Oli and his Chinese counterpart Li Keqiang to seal the deal on Nepal’s cooperation in the “Belt and Road”Initiative

Nepal as a “solid Partner” of China’s BRI

Against this Background, the updated success message to the Chinese news Agency Xinhua, a read pipe of the party leadership, spoke about the cooperation with Nepal. Accordingly, China has become the largest foreign direct investor is still ahead of India. Both sides would now go to the implementation of the understanding Memorandum in June. With Nepal’s participation in the BRI-it is nothing Less than a “these are the Himalayas an overarching, multi – dimensional network of connectivity” caused by a transnational road and rail network, power lines and Internet connections.

For all of these projects in a sufficient and secure supply of electricity is, however, a prerequisite, and is the weak spot in Nepal, despite its huge potential in hydropower. Therefore, China wants to invest in the Expansion of hydropower in Nepal, but because of the many changes of government in recent years in Nepal, and on the other because of the opposition of local civil society stakeholders, such as the question of compensation, not smooth.

According to Chinese information, the railway connection, – Kathmandu 2022 is set to be completed

Unsafe Mega-Power Plant Projects

This is especially true for large-scale projects such as the 1200-MW power plant Budhi-Gandaki, bringing the available power in Nepal nearly would double. After several Back-and-Forth in the year 2017 on whether to lift the power plant as a “project of national pride” rather be on their own, or it should be in the hands of the Chinese, has decided the new government under Prime Minister K. P. Sharma Oli (in office since February of 2018) at the end of September to award the project to the state-run China Gezhouba Group Corporation. The claimed at least Nepalese government representative, an official confirmation from China.

A Xinhua report on a Nepal meet Korean-Chinese work for the joint development of the power sector by the end of September did not mention the project Budhi-Gandaki. May the Chinese to act according to your experience with “domestic political game” (the formulation of the Nepal-expert on Julia street, home to the DW) in Nepal, now a little more cautious. From a similar-sized project in the West of the country, the planned 750-MW power station of the West-Seti, have you pulled back after several years of negotiations already.

Nepal-expert’s Julia street home of the Chancellor of Germany, Helmut Schmidt-Stiftung in Hamburg: “Nepal wants its trade and economic relations diversify”

In Nepal according to China

Despite these delays and setbacks, there’s Julia street home, according to “generally speaking, a very great optimism in Nepal compared to the neighbors of China.” The fears and the distrust of the rise of China, which exist in the West and now in Asia, would not be shared in Nepal in the same dimensions. On the contrary, such as beaches, home, explained: “The cooperation with China in the framework of the BRI is very important for the government to Oli. He’s made the promise a Central campaign: ‘I create political stability and economic development.’ Oli white, of course, that Nepal, as one of the poorest countries in the world can not afford this alone and, therefore, expected to benefit from the investment and the infrastructure.”

China type to be used by Nepal for its security strategy and policy in Tibet, is the other side of the coin, as Julia street home makes it clear: “China has built in the last years, also as part of the BRI, for the Nepalese Armed Police Force (APF), a police Academy. The APF is for border control in charge, there were common border controls. Behind it is quite clear that you want to restrict the flow of refugees from Tibet to Nepal or Nepal to India.”

Blockades on the border to India in 2015, let Nepal relations with the southern neighbor to reconsider

Readjustment of the relations to India

Another Central motive of the government in Kathmandu was the dependence of India to reduce, explains Julia street home: “Just two years ago, after the earthquake, there was an economic blockade by India and it has noticed, to was as the border and nothing more came into the country, no fuel, no medicines, that one was perfect from the Indian Partner. The repetition of such a Situation would be avoided, and the promises, especially of the connection to China.”

Connection to China is not an abandonment of India, the largest trading partner of Nepal. Especially in the field of power supply, India has in recent times an important role. Nepal, with its large current account deficit, wants to expand its hydropower for electricity export, particularly to energy-hungry neighbours to the South of the country. “Nepal and India, therefore, in small steps, the infrastructure for the Transmission, so power substation at the border and the corresponding connecting cables, in order to allow the Export in the long term,” explains Jürgen Welschof, team leader for energy South Asia at the German Kreditanstalt für Wiederaufbau (KfW) in an interview with DW.

So far, however, Nepal via this infrastructure, electricity from India, which has led to the expansion of further hydro power plants in the last two years to a noticeable improvement in the supply situation, as Welschof notes imported. In Kathmandu for example, there is now much less power shutdowns.

Earthquake undamaged a view in the turbine room of the German power plant Middle Marsyangdi survived:

Small, but fine: Germany’s contribution

To improve the power supply and helped by the KfW and the Federal government-funded power plant Middle Marsyangdi, which went into operation in 2009 and 70 MW of power is much more modest, therefore, comes as the China-and India-planned Mega-projects. “As in all Asian countries, Nepal’s rapid urbanization, which contributes to the fact that the power consumption increases. You do not need to cover but with 1000-MW power plants. You could manage with smaller power plants, it is only a few hundred megawatts,” said Welschof, compared to the DW.

After all, you’ve contributed to the peak load capable power plant on the middle reaches of the Central Nepal’s Marsyangdi river, ten per cent to the installed capacity of the power plants in Nepal. And not only that, The power plant survived the severe earthquake of 2015, whose epicenter was in the vicinity, completely unscathed. Some of the other power plants that were partially under construction, had been very badly damaged. “The power plant Middle Marsyangdi was not even notabgeschaltet on what to make from a professional point of view actually would. What has helped, for example, that the mobile phone networks in Nepal after the earthquake, were still working”, what “we are a bit proud of,” says the KfW-energy expert for South Asia.

Jürgen Welschof of the KfW: “Germany is only one of several partners, which will help improve Nepal’s power supply. We do this in many areas, in the context of the limited resources of Germany.”

Partnership and sustainability

On the question of how the approach and philosophy of the KfW is different in such a project, for example, of a large Chinese power plant project, says Welschof: “Our cooperation is partnership and at eye level. With the exception of the interest may differ in location in the case of projects financed by other countries. We are not, therefore, from our point of view, with such projects in the competition.”

Even after almost ten years of electricity production and the process for the care of KfW and the Federal government were still active, in order to support a long-term operation of the power plant, one of the largest development projects of the KfW in Asia. In the sustainability problem, namely, among other things, due to the low budget of the Nepal electricity provider NEA for maintenance and operation – not only this project, but also of many other power plants and power lines.