Non-Resident Nepali Association 3 rd NRN APAC Regional Meet 2013, Manila Hydropower Investment in Development of Nepal Rameshwar Shah Vice President Non-Resident Nepali Association, International Coordination Council

“for NEPALI by NEPALI" Background: 10 years of Diaspora 10 years of Diaspora 3.2mn NRN’s in over 100 countries, over 90% in Foreign Employment 3.2mn NRN’s in over 100 countries, over 90% in Foreign Employment $5bn Remittance, >92% used in domestic cause $5bn Remittance, >92% used in domestic cause Emerging Need for overall economic development. Emerging Need for overall economic development. NRN’s voice for Collective Investment NRN’s voice for Collective Investment NRB Governor formed High level TF in January 2011 to identify the GAP in law and recommend amendment in legal provisions to allow NRN’s to bring investment collectively. NRB Governor formed High level TF in January 2011 to identify the GAP in law and recommend amendment in legal provisions to allow NRN’s to bring investment collectively.

“for NEPALI by NEPALI" Background: High Level TF recommendation to the NRB and SEBON. High Level TF recommendation to the NRB and SEBON. 5 TH NRN Global Conference confer investment in 100MW hydropower project in Nepal by NRN’s. 5 TH NRN Global Conference confer investment in 100MW hydropower project in Nepal by NRN’s. ICC decision to pursue Collective Investment ICC decision to pursue Collective Investment NRNA Executive started Collective Investment campaign in various countries and regions using their global network NRNA Executive started Collective Investment campaign in various countries and regions using their global network

“for NEPALI by NEPALI" The Investment Company: NRN’s formed an Investment Company in Nepal in September 2013 NRN’s formed an Investment Company in Nepal in September 2013 Some 785 investors, including 3 FDI and 4 local company subscribed for nearly Rs. 1bn investment Some 785 investors, including 3 FDI and 4 local company subscribed for nearly Rs. 1bn investment 25% of the commitment amount was called and received ending Feb % of the commitment amount was called and received ending Feb Some 18 hydropower project was identified and analyzed Some 18 hydropower project was identified and analyzed NRNIL acquired 51% stake in 27MW Dordi Khola Hydropower Project in Lamjung. NRNIL acquired 51% stake in 27MW Dordi Khola Hydropower Project in Lamjung.

“for NEPALI by NEPALI" Dordi Khola Project: 27MW 4 years Project period, GWh Energy, 4.3bn project cost, IRR 13.1%, RoE 16.9%, Simple Pay back <6yrs. 4 years Project period, GWh Energy, 4.3bn project cost, IRR 13.1%, RoE 16.9%, Simple Pay back <6yrs. Project work is continuing, DPR is expected end May. Project work is continuing, DPR is expected end May. Land acquisition work is going on. Land acquisition work is going on. Banks are engaged, financial closure is expected mid July. Banks are engaged, financial closure is expected mid July. Interaction Program and project site visit are organized. Interaction Program and project site visit are organized. Nepali media are keenly covering project progress update situated under Dordi Khola corridor. Nepali media are keenly covering project progress update situated under Dordi Khola corridor. Our web site can be visited for the. The site link is: Our web site can be visited for the. The site link is:

“for NEPALI by NEPALI" NRNIL work update: Necessary appointments such as: BOD, MD, Auditor, CS, office staff are done. Office is working smoothly. Necessary appointments such as: BOD, MD, Auditor, CS, office staff are done. Office is working smoothly. Engineering and Consulting Team selection in process Engineering and Consulting Team selection in process Team is working on to get share lagat certified from ROC Team is working on to get share lagat certified from ROC Issuance of Share Certificate to the investors in process. Issuance of Share Certificate to the investors in process. NRNIL team is continuously working with government authorities and hydro engineering consulting team to secure other projects which will aggregate to 100MW. NRNIL team is continuously working with government authorities and hydro engineering consulting team to secure other projects which will aggregate to 100MW. All un-invested money has been kept under call account. This now earns some 9% interest annually, the return. All un-invested money has been kept under call account. This now earns some 9% interest annually, the return.

“for NEPALI by NEPALI" The Strategy: Government has cancelled some 672 hydropower project licenses recently. Government has cancelled some 672 hydropower project licenses recently. Many more license cancellation is on the way… Many more license cancellation is on the way… This is to invite and facilitate real investors in Hydropower sector instead, This is to invite and facilitate real investors in Hydropower sector instead, “Jhola ma Khola ko satta khola bat bidhyut” We have taken strategy to go for fresh licenses. We have taken strategy to go for fresh licenses. This is to avoid possibility of unsupported expense and/or premium payment. This is to avoid possibility of unsupported expense and/or premium payment.

“for NEPALI by NEPALI" my Perspective: In my perspective, Hydropower is the best sector for all type of investors. It’s a risk free investment!-HOW?? In my perspective, Hydropower is the best sector for all type of investors. It’s a risk free investment!-HOW?? संसारको सबभन्दा अप्ठेरो काम भनेको उत्पादन बिक्रिनैहो, तर नेपालको जलविधुत एकमात्र एउटा यस्तो क्षेत्रहो जसको उत्पाद बिक्रिको निश्चितता उत्पादन हुनु अगाबैनै तय हुनेगरेकोछ, अर्थात् Guaranteed Revenue Guaranteed Revenue Government subsidy: Tax and Custom Rebate Government subsidy: Tax and Custom Rebate Long term return-30 years Long term return-30 years Easy financing- prioritized sector, must finance senario, low interest rate. Easy financing- prioritized sector, must finance senario, low interest rate.

æg]kfnLsf nflu g]kfnLÆ “for NEPALI by NEPALI" Thank you…