In a strategic move to bolster their energy sectors, Nepal and Bhutan are actively seeking investments from Indian companies to develop hydropower projects. Both nations aim to enhance electricity generation and export surplus power to India, aligning with India’s goal of achieving net-zero emissions by 2070. Currently, Nepal exports approximately 2,070 megawatts (MW) of electricity to India, while Bhutan contributes around 700 MW. Bhutan has set an ambitious target to reach an annual power generation capacity of 25 gigawatts (GW) by 2040, comprising 20 GW from hydropower and 5 GW from solar energy. To facilitate this expansion, Bhutan is considering increasing the cap on private investment in hydropower projects, which is presently limited to 49%.
Nepal, with an annual power production of about 3,000 MW—95% of which is derived from hydropower—plans to scale up its generation capacity to 28 GW within the next 10 to 12 years. The country imposes no restrictions on private investment in the hydropower sector, presenting lucrative opportunities for Indian investors. Indian energy conglomerates, including Tata Power, Adani Group, and Reliance Power, are already engaged in various stages of project development in both Nepal and Bhutan. These collaborations are expected to strengthen regional energy security and contribute to sustainable economic growth. The pursuit of Indian investment underscores the interconnected nature of South Asia’s energy landscape and the mutual benefits of cross-border cooperation in renewable energy initiatives.
