FOUR CHILDREN WASHED AWAY BY FLOOD WATER Kathmandu, 20 Sept.: Four children were washed away Chaudha khola Wednesday, Gorkhapatra reports from Sindhuli. They had gone to play football. Flood water entered Sakhamadi. A search and resume mission has been launched. Nnnn a$633M LOAN SOUGHT FROM CHINA Kathmandu, 20 Sept.: The government has requested the Chinese government to provide a soft loan of US$ 633 million to develop two projects, 335 MW Upper Arun and 87 MW Tamakoshi. The Finance Ministry has written to the Chinese government asking for the money as per the recommendation of the Nepal Electricity Authority (NEA), Ashok Thapa writes in The KathmanduPost.. The request for the soft loan was made as per the interest shown by the Chinese government to invest in one of the two hydropower projects in Nepal. Finance Ministry officials said that the Chinese government had asked the ministry to identify one of the two appropriate projects for the credit. The Foreign Aid Division of the ministry had asked the NEA to propose two projects mentioning that the Chinese government was willing to provide a soft loan through China Exim Bank. Ministry officials, however, said that though the request for the soft loan had been made, its interest rate has not been determined. “Once the Chinese side approves our request for the soft loan, negotiations will be held to fix the interest rate,” said a source at the Finance Ministry. “As per the Finance Ministry’s request, we have recommended the Upper Arun and Tamakoshi V projects which will be significant in reducing the growing hours of load-shedding,” said Ram Chandra Pandey, general manager of the Generation Construction Division at the NEA. He also said that these two projects had been recommended for the soft loan as their feasibility studies have been completed. “After the Finance Ministry sent the names of these two projects, the Chinese government has been learned to be positive to finance their construction. Previously, the NEA had requested the Ministry of Energy (MoE) to finance these two projects in September 2012. NEA officials said that if the Chinese government approves the loan request, the transmission line for the projects could also be developed from it. The NEA has been planning to develop the projects on its own after the loan request is approved. As per the proposal of the Finance Ministry, the Chinese Exim Bank will provide 85 percent of the requested amount while the government of China will provide the rest. The NEA had carried out a feasibility study for both these run-of-the-river (ROR) projects in 1999. “We have already asked the MoE for permission to develop the projects on our own,” added Pandey. The Upper Arun Hydropower Project lies in Sankhuwasabha district in the Eastern Development Region. It has a firm capacity of 250 MW which is about 75 percent of the installed capacity. The total cost of the project is estimated to be US$ 500.79 million. “This project will add 2,050 GWh of energy annually to the national power grid which will be a milestone to fulfil the power demand of the load centres of the Eastern Region minimizing transmission loss, according to a report of the feasibility study. The construction duration of the project will be four and a half years. Meanwhile, the total project cost of Tamakoshi V is estimated to be US$ 131.99 million, and it will take four years to be completed. This cascade project is located in Dolakha district of Janakpur Zone in the Central Development Region. The total power generation of this project will be 428.26 GWh per year. Nnnn WEEKLONG TUSSLE BETWEEN IS AND EVEREST INSURANCE CO. ENDS Kathmandu, 20Seot.: A week-long tussle between Insurance Board (IB) and Everest Insurance Company ended on Wednesday following the latter’s apology over its move to ‘stop issuing new policy’, limiting its operation to settlement of claims. The two were involved in a bitter dispute after the IB barred Everest from issuing fire policies and the insurance company decided to halt the issuance of new policy in retaliation, Bibek Subedi writes in The Kathmandu Post. IB, infuriated with the Everest’s decision, summoned the entire board member of the insurance company at IB office by 11:30 on Wednesday. During a meeting, the members claimed that they were ‘unaware’ of the fact that an insurance company cannot stop issuing new policy, according to a senior IB official. “The entire board members admitted their mistake,” said the IB source. “They also committed to start issuing new policy from Thursday and strictly adhere to the corporate governance regulation recently issued by the IB.” The insurance company clarified that it was not its intention to get into confrontation with the IB and that it stopped issuing new policy because it was preoccupied with the settlement of large volume of outstanding claims. “Even in Insurance Act and regulation, it is not mentioned that an insurance company cannot stop issuing new policy,” said Kewal Krishna Shrestha, company secretary of Everest Insurance Company, during a press meet on Wednesday. The latest development means that Everest will be issuing new insurance policy after halting it for eight days. The company will be following the IB’s recent corporate governance regulation which among others, bars company from selling insurance policy to an entity promoted by the same person or group that is in the board or management of the insurance company. Imposing restriction on coverage of fire insurance, the IB has taken action against Everest over 18 different cases of irregularities. The regulator’s action includes a Rs 10,000 fine on CEO Shrestha for making payment “illegally” to claims of Himalayan Snax, the manufacturer of Mayos noodles. The conflict between the IB and insurance company may have resolved, but according to IB sources, the regulator is not in a mood to lift the ban on Everest from issuing fire insurance policy at time soon. “Unless the insurance company completes all the legal procedure, the IB will not lift the ban,” said the source. “It should first settle “illegally” paid claims of Himalayan Snax with the reinsurance and also resolve those 18 cases of irregularities.” Meanwhile, Rajendra Khetan has stepped down from the post of chairman at Everest Insurance Company effective from Wednesday, with Vice-chairman Ratan Lal Sanghai replacing him. The insurance company did not disclose the reason behind his resignation, saying it was Khetan’s personal decision unrelated to the recent issues. The company has nominated Madhu Sudhan Agrawal, Birendra K Shah, Niranjan Tibrewala, Om Prakash Sikaria, Prasad Gyawali and Rabi K Tibrewala on its board but is yet to choose a new vice-chairman. nnnn