Kathmandu. Finance Minister Rameshwor Prasad Khanal has said that it would be appropriate to grant IPO permission to hydropower companies only after the lights are on.
During a meeting with a delegation of the Independent Power Producers’ Association of Nepal (IPPAN) on Monday, Minister Khanal said that the IPO of hydropower companies that had already applied for the IPO would not be acceptable until further laws were formulated. Speaking at the meeting, IPPAN Chairman Ganesh Karki said that the Securities Board of Nepal (SEBON) has stopped the IPO of hydropower companies for the past 28 months.
Chairman Karki said that the public issue of more than Rs 23 billion of 4 dozen companies in the pipeline should be done at the earliest, the hydropower companies should not have a net worth to get permission for IPO, and the power projects should be issued shares to the locals and general public while they are under construction. He demanded that the rule of granting IPO permission after the completion of 65 percent of the construction should be implemented and the CDSC has not listed the shares of hydropower companies that have already been issued publicly saying that they will give separate IGN numbers to the general public and promoters.
Karki also urged Khanal to be serious about resolving the problem as the bank has started pressuring the companies that have taken loans against the IPO to repay the loans and the government has stopped giving loans to the projects that have not been lit and the way to get money from the IPO is uncertain.
The then Prime Minister KP Sharma Oli had addressed the House of Representatives stating that the provision was withdrawn in the power purchase agreement (PPA) of river-flow-based (RoR) projects in the budget for the current fiscal year, but it has not been removed from the budget so far. IPPAN has also urged Finance Minister Khanal to remove the provision of Take and Pay PPA from the budget and facilitate the opening of PPA.
Likewise, the government has been allowing the import of spare parts from hydropower projects by imposing 28 percent customs duty for the last two years as the government has been allowing the import of spare parts from hydropower projects by imposing 28 percent customs duty. g.
After listening to the IPPAN delegation, Finance Minister Khanal said that although he had suggested that it would be appropriate to give IPO permission to hydropower companies only after the lights are on, necessary laws have not been formulated for the implementation of the suggestion and now that the House of Representatives has been dissolved, there is no situation to formulate new laws or amend them immediately. Responding to a query from the Securities Board of Nepal (SEBON), Khanal said, “There is no law to implement the suggestion of issuing IPO after the lights are on.
Finance Minister Khanal said that the House of Representatives is needed to formulate new laws or amend the laws, but now that the House of Representatives has been dissolved, the hydropower companies should get IPO permission as per the existing law. He also pledged to work to boost the morale of the energy producers as per the mandate of the government by relying on the existing laws.
