Germany commits Rs 1.46 billion grant to Nepal for power distribution project
The Ministry of Finance (MoF), representing the Government of Nepal, and the Embassy of the Federal Republic of Germany, on behalf of the Government of Germany, have signed a grant agreement to implement the Power Distribution Strengthening Programme (PoDiSP) in Nepal.
Germany has committed €10 million (approximately NPR 1.46 billion) in grant assistance, as announced by the Ministry of Finance in a press release.
The agreement was signed and exchanged at the Ministry of Finance in Kathmandu by Dr. Thomas Prinz, German Ambassador to Nepal, and Dhani Ram Sharma, Joint Secretary of the International Economic Coordination Cooperation Division, on behalf of their respective governments.
The PoDiSP seeks to enhance Nepal’s electricity distribution infrastructure and incorporate climate-friendly technologies to deliver a more reliable and efficient power supply. Key focus areas include Bharatpur (Bagmati Province), Butwal and Bhairahawa (Lumbini Province), and Pokhara (Gandaki Province).
The programme will support the Nepal Electricity Authority (NEA) in conducting a detailed feasibility study and upgrading existing distribution systems with modern, climate-smart technologies. This initiative aims to improve energy efficiency, reliability, and sustainability, ensuring enhanced electricity access for the targeted regions.
PoDiSP will be executed as part of German Financial Cooperation (FC) through KfW, Germany’s development bank. It will be integrated into Nepal’s official budgetary framework and reflected in the “Red Book” for implementation, with operations slated to begin in 2025.
During the signing ceremony, Joint Secretary Sharma underscored the programme’s potential to significantly improve power supply reliability in the designated regions. He extended his heartfelt gratitude to the Government of Germany for its steadfast support in strengthening Nepal’s energy sector.
Ambassador Dr. Prinz expressed satisfaction in contributing to Nepal’s electricity distribution enhancement, emphasizing the deployment of modern and climate-resilient technologies to promote energy efficiency. He also highlighted the deepening of bilateral cooperation through this agreement, further strengthening the longstanding ties between the two nations.
The Government of Nepal conveyed its appreciation to Germany for its consistent support and pivotal role in advancing Nepal’s socio-economic development.
The signing ceremony was attended by senior officials from the Ministry of Finance, the Nepal Electricity Authority, the German Embassy in Kathmandu, and KfW Nepal.
