Opportunities
Nepal's hydropower and infrastructure sectors offer immense growth potential, with continuous investment opportunities arising from the need for large hydropower projects to meet rising domestic and regional energy demands. Urbanization will drive demand for infrastructure such as roads, bridges, and transportation systems delivering consistent, long-term returns through scaled-up investment.
Our PPP model leverages partnerships with the Nepalese government and local businesses to accelerate infrastructure development. Nepal's stable, experienced, and committed workforce further positions us to capitalize on these opportunities, paving the way for sustainable growth, increased profitability, and positive social and environmental impact.
With forward-looking policies, innovative financing, and a collaborative development approach, Infra Nepal is uniquely positioned to harness these opportunities. This strategic pathway not only drives economic progress but also creates long-lasting social benefits for communities throughout the region.
Hydropower: Nepal's Natural Advantage
Nepal has an estimated hydropower potential of 84,000 MW, yet only about 3,500 MW has been harnessed so far—80% of which comes from the private sector. Since the early 1990s, the Government of Nepal has maintained a consistent policy that encourages private-sector participation through long-term licenses (35 years) to build, operate, and sell electricity. The Nepal Electricity Authority (NEA), a government-owned utility, guarantees the purchase of electricity at a pre-determined rate for 30 years, minimizing investor risk.
Nepal is already exporting surplus power during the monsoon season, marking the beginning of a new era in energy trade.
Key Drivers
Strong Internal Capacity
Nepal has built considerable expertise over the last three decades in all phases of hydropower development — including project identification, feasibility studies, engineering design, construction, and operation. Local engineering firms, consultants, and contractors possess the technical know-how to execute complex projects with increasing self-reliance, reducing dependency on foreign expertise and accelerating project timelines.
Banking Sector Appetite and Experience
Nepal's financial institutions have steadily increased their exposure to hydropower projects and now play a critical role in financing the sector. Banks and financial organizations are familiar with hydropower's project risks and long-term revenue models, often collaborating with developers and international lenders to arrange structured financing. The presence of government guarantees (via NEA's Power Purchase Agreement) further strengthens lender confidence. This growing experience and willingness to invest have improved access to capital for private hydropower developers.
Tax Incentives
Hydropower companies benefit from a 10-year corporate tax holiday and VAT reimbursements on construction materials, making investments financially attractive.
Growing Domestic Demand
Nepal's internal electricity consumption is expected to surge, requiring over 10,000 MW in the coming decade due to urbanization, industrialization, and improved living standards.
Regional Export Agreements
Signed agreements to export 10,000 MW to India, and ongoing negotiations with Bangladesh for another 10,000 MW, position Nepal as a future regional clean energy supplier.
Power Purchase Guarantee
The Nepal Electricity Authority guarantees purchase of electricity at fixed tariffs for 30 years, providing stable and predictable revenue streams for investors.
Socioeconomic Impact
Hydropower projects create thousands of jobs in remote areas, invest 0.75% of infrastructure costs in local social and environmental programs, and bring essential infrastructure like roads, bridges, and fiber-optic internet to underserved communities.
Environmental Benefits
Hydropower offers clean, renewable energy that helps Nepal reduce its carbon footprint, cut fossil fuel imports, and improve its trade balance.