Hydropower debt increases three-fold
However, the PM reassured that this would be liquidated through the commissioning of ongoing hydropower projects
The country’s hydropower project debt has increased to Nu 132.9bn in the 12th Plan. In the 10th Plan, the hydropower debt was just Nu 54mn.
However, Lyonchhen Dasho Tshering Tobgay, talking to the public of Chhukha Dzongkhag, said the debt which has tripled is worrisome but not a great concern since it will be liquidated once all the ongoing hydropower projects are commissioned.
He said that non-hydropower debt need to be repaid through other means, while hydropower debt can be self-liquidated once all the ongoing hydropower projects are complete and commissioned.
Already, Dagachhu hydropower plant has been commissioned which means that the project has started repaying the loans. The 126MW Dagachhu hydropower plant was commissioned
in 2015. Likewise, Punatshangchhu II and I are expected to be complete by 2021 and 2023 respectively.
Among the five ongoing hydropower projects, three are in the advanced stages of development. Mangdechhu hydroelectric project is expected to be complete by 2018. Punatshangchhu-I and II are in the advanced stages of completion and Kholongchhu project and Nikachhu hydropower project were started a few years back. These multi-billion projects are expected to repay the loans.
More than 70% of the power generated through a total of 1,614 MW projects is exported to India earning almost INR 13 to 14bn as revenue.
Ongoing mega projects which have taken up most of the hydropower loans are expected to earn Nu 40bn annually once commissioned.
Also, Lyonchhen said that all the projects which are implemented through loans are faring well with no waste of resources. Hydropower projects like Chhukha hydropower plant and Kurichhu hydropower plant constructed with loans have completed paying their debts. The debt for Tala hydropower plant will be liquidated this year. “We have set a trend in repaying the debts and we will be doing so with the rest of the power supply. There is no reason to panic,” he said, adding that non-hydropower debt has fallen in the 11th Plan which is good news.
The country availed Nu 38.2bn non-hydropower loan in the 11th Plan.
Meanwhile, the PM said that the government’s annual revenue has increased from the 10th to 11th Plan by more than Nu 1bn. By the end of the 10th Plan the annual government revenue stood at Nu 5.15bn, which increased to Nu 6.5bn by the end of the 11th Plan.
The government also succeeded in increasing the power tariff of the Chukhha power plant to India from Nu 2 per unit to Nu 2.25 in 2014. Now, the tariff is increased to Nu 2.55 per unit.
Additionally, the hydropower projects have contributed to employment generation in the country. Currently, the hydropower sector employs around 12,700 Bhutanese.
The PM said that the government has put in place a public debt policy disallowing the government more than 35% non-hydro debts and loan repayment of hydro debts should not be more than 40% of hydro revenue.
Moreover, the government has paid off most Rupee loans taken for short term consumption. “We are in a good situation but our hydro debts had gone up because we are in the midst of building five hydro power projects,” he said.
Lyonchhen graced the 11th Five Year Plan (FYP) Final Report and 12th FYP sensitization for Chhukha Dzongkhag this week at Gedu College of Business Studies.
At the meeting, Chhukha Dzongda Minjur Dorji reported that of the total 54 Key Performance Indicators (KPIs), Chukhha has achieved 45 KPIs; seven KPIs are on track and two at risk.
Lyonchhen congratulated Chhukha for its remarkable achievements in the 11th Plan. In the sphere of farm roads, Chhukha has 89 new farmlands with length stretching to 503 km. Road maintenance was also part of the 11th Plan for Chhukha and 358.74 km of road stretch were clipped to maintenance works.
Apart from speaking on the state of country in terms of finance, education and health, Lyonchhen spoke on the five jewels in the country; namely hydropower, tourism, cottage and small industries, mining and agriculture. He explained that these spheres have depicted tremendous growth in the 11th Plan.
Lyonchhen added that the institution of Annual Performance Agreement at different levels of ministries and Dzongkhag could measure the achievement annually and report to the government objectively.