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Don’t Make Funding To India-Nepal Raxaul-Amlekhganj Oil Pipeline
By KTM Metro Reporter
May 2, 2013: the Ministry of External Affairs (MEA) has written a letter to the Ministry of Petroleum and Natural Gas, and the Indian Oil Corporation (IOC) asking them to be cautious envisaging funding for the India-Nepal Raxaul-Amlekhganj oil pipeline project, according to the news posted on thehindu.com today.
Nepal imports all petroleum products from India that also primarily from the Raxaul-Birgunj entry point. IOC had proposed the pipeline project in 1997. The length of pipeline is 41 Km of which two kilometers will be in India and the rest will be in Nepal. The pipeline will reduce the cost of transportation of petroleum products by 40%. The estimated cost is one billion rupees. The project will be completed in two years, and the cost recovery will be in six years, according to the news report.
The MEA in its letter said, “Given the complex political reality in Nepal, it would be advisable for IOC to handle the pipeline issue with utmost caution and avoid making any commitments for its execution unless there is absolute clarity on land availability on both sides, and a mutually accepted framework for security, construction, operation and management issues has been evolved.”
The MEA also said, “It is all vague right now. What we are asking is that the Nepali side must think through the project, what it involves, and how will they manage the obstacles. This can then be taken forward.”
The Hindu quoted Commerce Secretary of Nepal Lal Mani Joshi as saying from Kathmandu, “The project has been on the table for a long time, and we are very keen to see it happen. IOC can construct the pipeline in two years. It can recover its investment in six years, and make profits in two more years. At the end of 10 years, the pipeline can be transferred to Nepal.”
