Power Finance Corporation Ltd. (PFC) along with REC Ltd signed a Memorandum of Understanding (MoU) with Kholongchhu Hydro Energy Ltd (KHEL) for extending a term loan of Rs.4,058 crore for the 600-mw hydropower project at Trashi Yangtse, Bhutan.
The MoU was signed in the presence of R. S. Dhillon CMD, PFC; Sanjay Malhotra, CMD REC; N. L. Sharma, CMD, SJVNL and Dasho Yeshi Wangdi, Chairman, KHEL.
Indo-Bhutan JV
KHEL, a joint venture company of Central PSU SJVN Ltd and Druk Green Power Corporation Ltd (DGPC) (a Royal Government of Bhutan undertaking) is executing the project.
Project financing
The project is proposed to be funded in a debt-equity ratio of 70:30. The term loan of Rs.4,058 crore will be equally shared by PFC and REC. Apart from PFC and REC, Rs.400 crore is proposed to be arranged from Bank of Bhutan (Rs.200 crore) and NPPF, Bhutan (Rs.200 crore).
First JV in Bhutan
This is the first project being executed under joint venture (JV) model in Bhutan. Expected to be commissioned during FY26, the Trashi Yangtse hydropower project will generate about 2,569 million kwh of electricity per year. This will be shared between India and Bhutan.
Bilateral cooperation
The hydropower sector is the flagship area of India-Bhutan bilateral cooperation and funding of this upcoming hydroelectric project by PFC will be beneficial in strengthening the relationship between India and Bhutan.
