The board of Power Grid Corporation of India Ltd (PGCIL) has approved a proposal to purchase around 77.30 lakh equity shares currently held by IL&FS Energy Development Company Ltd (IEDCL) in Cross Border Power Transmission Company Ltd.
In a recent stock exchange filing, PGCIL said that its board of directors, in its meeting held on May 1, 2022, approved the purchase of 77,30,225 equity shares (of Rs.10 each) currently held by IEDCL in the multi-party joint venture Cross Border Power Transmission Company Ltd (CBPTCL).
PGCIL to become largest shareholder
According to an analysis done by T&D India, if the proposal of PGCIL is implemented, PGCIL will become the largest shareholder in CBPTCL.
CBPTCL, as of March 31, 2021, had an equity share capital of Rs.48.51 crore represented by 485,09,412 equity shares of Rs.10 each. The single largest shareholder in CBTPCL (see table) currently is IEDCL (38 per cent), followed by PGCIL and SJVN Ltd (each with 26 per cent). Nepal Electricity Authority (NEA) is a minority shareholder with 10 per cent stake.
Assuming that there is no fresh infusion of equity shares in CBPTCL, the shareholding of PGCIL will rise to 42 per cent and that of IEDCL will drop to 22 per cent. The stakes of SJVN and NEA will remain unaffected.
Following higher equity stake, PGCIL will be entitled to have more representation on the board of CBPTCL.
Power links with neighbours
The main business objective of CBPTCL is building, maintaining and operating transmission systems between India and neighbouring countries like Nepal, Bhutan, Bangladesh, Myanmar, Sri Lanka and Pakistan for the purpose of export and import of electricity, transmission of data, etc.
Also read: No Cost Overrun In PGCIL’s TBCB Projects
Current operations
Currently, CBPTCL owns and manages a 400kV double-circuit transmission line, running 85.55 km, from Muzaffarpur (Bihar) to Sursand (Nepal Border) and extension of two 200kV bays at 400/220kV Muzaffapur substation for termination of 400kV double-circuit Muzaffarpur–Dhalkebar (Nepal) transmission line. The transmission line includes OPGW for communication purposes. Nepal Electricity Authority (NEA) is beneficiary of the project.
The project, operational since February 2016, establishes synchronous interconnection between Indian and Nepalese electrical grids. Currently, Nepal is importing power from India through this transmission system but once ongoing hydropower projects in Nepal are commissioned, India could also import electricity from Nepal through this link.