YOG INFRA Q4 2024 insights
SOUTH ASIAN countries - Bangladesh, Nepal, Bhutan and Sri Lanka (BNSB) are taking notable proejct developments in infrastructure development. Bangladesh is aiming to attract international investments through tax exemptions for solar projects and ADB has already supported a 20MW project. Nepal aims to monetize carbon credits to mobilize financing for planned clean energy projects and has also finalized terms of OBOR agreement. Bhutan has entered into foreign collaboarations for development of hydropower proejcts, along with planned mindfullness city. Sri Lanka is focussing on e-mbility sector through use of electric buses in public transport system.
Read more about key developments in Infrastructure and PPPs in the four countries in our Q4 2024 insight.
BANGLADESH
BANGLADESH LIKELY TO RETAIN POWER PURCHASE PACT WITH GAUTAM ADANI
Bangladesh is likely to set aside pricing concerns and retain a power purchase pact with India's Adani Power, in the face of supply worries and gloomy prospects for a legal challenge. The new government has set up a panel to gauge whether its predecessor's contracts adequately protected the nation's interests, particularly projects faulted for lack of transparency that were initiated under a special expediting law. One contract being scrutinised over price concerns is a 2017 deal to buy electricity for 25 years from Adani's USD 2 Bn, 1,600-MW power plant in India's eastern state of Jharkhand that exclusively supplies Bangladesh.
Also, a legal challenge in an international court was likely to fail without strong evidence of wrongdoing. While an exit may not be possible, the only feasible option could be a mutual agreement to reduce the tariff.
The Adani power costs Bangladesh about 12 taka (USD 0.1008) a unit. That is 27% higher than the rate of India's other private producers and as much as 63% more than Indian state-owned plants. Under the deal, Bangladesh has been sourcing electricity since April 2023 from Adani, along with about 1,160 MW from other Indian plants. Dhaka is struggling to clear dues of USD 800 Mn to Adani Power, among more than USD 1 Bn owed to Indian power companies, because of difficulty in accessing dollars to make payment.
ADB APPROVES USD 100 MN TO BOOST INFRASTRUCTURE IN BANGLADESH
The Asian Development Bank (ADB) has approved a USD 100 Mn loan in additional financing to support critical infrastructure development through public–private partnerships (PPP) in Bangladesh. This project will enable Bangladesh to catalyse private sector financing, reduce pressure on public finance to address infrastructure development deficits, and create more employment. The loan will enhance the financial and institutional capacity of the Bangladesh Infrastructure Finance Fund Limited (BIFFL) to deliver its mandate of fostering an environment that supports sustainable private investments through the mobilisation of PPP, with a strong focus on gender and climate change.
Bangladesh is undergoing a transformative phase, driven by economic shifts and recent political transition. The country's infrastructure development, primarily driven by the public sector, faces challenges due to limited resources and implementation constraints. A key hurdle in infrastructure investment is the shortage of long-term debt funding in the local market. The ADB loan aims to address this gap by providing long-term financing to BIFFL, facilitating the completion of critical infrastructure projects that will foster economic growth.
The Strengthening the Bangladesh Infrastructure Finance Fund Limited Project – Additional Financing will strengthen BIFFL’s capacity to crowd in private sector financing and facilitate new technologies brought by international sponsors and foreign direct investors. With ADB’s support, BIFFL will establish gender screening of subprojects and develop a gender equality and social inclusion strategy.
CHATTOGRAM PORT EXECUTES FOUR PROJECTS UNDER PPP MODE
The Chattogram Port Authority (CPA) is implementing four projects under Public Private Partnership (PPP). The Projects include:
Laldia Container Terminal,
Bay Terminal (Terminals 1 and 2),
New Mooring Container Terminal (NCT), which includes the Overflow Container Yard (OCY), and
Patenga Container Terminal’s equipment, operation, and maintenance are among the projects.
A feasibility study is now being conducted on the operation of Chattogram Port’s Laldia Container Terminal using the PPP model. The feasibility study phase of the New Mooring Container Terminal (NCT) and Overflow Container Yard (OCY) operation and maintenance project is currently underway. It will be carried out in accordance with G2G guidelines with the UAE government (DP World is a state-owned firm situated in Dubai).
The Patenga Container Terminal project, which was carried out in accordance with G2G principles with the KSA government, is currently in the operation stage of equipping, operating, and maintaining the facility. The operation is run by RSGT Bangladesh Ltd., a private partner.
The government chose to designate foreign operators for the Patenga Container Terminal (PCT), New Mooring Container Terminal (NCT), and two Bay Terminal terminals during the last decision-making meeting. Additionally, the government made the decision to use the Public Private Partnership (PPP) method to select foreign operators for CPA terminals. In addition, APM Terminals of Denmark has suggested a public-private collaboration for the construction of the Laldia Container Terminal.
BANGLADESH INTRODUCES 10-YEAR TAX EXEMPTION FOR RENEWABLE ENERGY PROJECTS
Bangladesh is introducing a 10-year tax exemption package for renewable energy production — a move expected to help boost clean electricity generation, which is still hampered by high production costs. The 10-year tax exemption for renewable energy projects in Bangladesh will apply from July 1, 2025. The National Board of Revenue issued a notification for projects that will begin commercial operations by mid-2030.
The policy grants 100% tax exemption for renewable energy plants in the first five years, 50% in the next three years, and 25% in the following two years. Companies whose commercial production will start between July 1, 2025 and June 30, 2030, are exempted from the tax. The policy backtracks on the previous government’s 2023 decision to withdraw full tax exemptions for the renewable energy sector, discouraging local and foreign investors.
While Bangladesh aims to achieve its net-zero emissions goal by 2050, currently its clean electricity generation capacity is 1.38 GW or only about 5% of the total, which comes mostly from fossil fuels — mainly natural gas. The country has been struggling for years with energy crises as demand grows about 7% a year amid increasing household and industry use, increasing Bangladesh’s dependence on imports as local production is insufficient, with the renewable energy output being among the lowest in the world.
ADB, MSEL SIGN DEAL TO ESTABLISH 20-MW SOLAR POWER PLANT IN BANGLADESH
The Asian Development Bank (ADB) has signed a USD 24.3 Mn financing package with Muktagacha Solartech Energy Limited (MSEL) to establish a grid-connected solar photovoltaic power plant in Mymensingh, Bangladesh. As the sole mandated lead arranger, ADB arranged, structured, and syndicated the financing package for MSEL, which is owned by Bangladesh-based energy company Joules Power Limited (JPL). It comprises a USD 15.5 Mn loan from ADB and a USD 8.8 Mn loan from Leading Asia’s Private Infrastructure Fund 2 (LEAP 2), administered by ADB.
The project will build and operate a 20-megawatt (MW) grid-connected solar photovoltaic power plant—one of the initial private sector utility-scale solar facilities in the country to secure support from international financiers. The solar power plant will generate 37.9 gigawatt-hours of electricity annually and avoid 18,344 tons of carbon dioxide emissions annually.
BANGLADESH ANNOUNCES TENDERS FOR 353 MW SOLAR PROJECTS
The Bangladesh Power Development Board (BPDB) has issued 12 international tenders for 353 MW of grid-connected solar power projects. The bidding process will follow a one-stage, two-envelope format, with bids due by February 3, 2025, and opening on the same day.
Each tender requires a bid document fee of BDT 25,000 and a bid security fee of BDT 250,000. The projects, funded through BPDB’s revenue budget, will be developed across various regions:
Sudharam, Noakhali: 10 MW
Hathazari, Chattogram: 18 MW
Sabujpara, Nilphamari: 20 MW
Moulavibazar: 25 MW
Bajitpur, Kishoreganj: 25 MW
Kaptai, Rangamti: 25 MW
Teknaf, Cox’s Bazar: 30 MW
Lohagara, Chattogram: 30 MW
Nobabganj, Dhaka: 35 MW
Kurigram: 45 MW
Fatikchari, Chattogram: 45 MW
Bhaluka, Mymensingh: 45 MW
In recent years, Bangladesh has actively pursued solar energy expansion:
In 2024, the Bay of Bengal Power Company tendered a 160 MW solar project at Maheshkhali Peninsula, Cox’s Bazar.
In 2023, BPDB floated tenders for over 127.6 MW of solar projects, including a 50 MW project at Rangunia, Chattogram.
Amara Raja Infra, alongside Premier Solar Powertech, secured a 100 MW solar project from the Rural Power Company in 2023.
Solar contributed 459 MW to Bangladesh’s power generation in 2022-2023. The government, with World Bank support, signed a USD 515 Mn agreement in 2022 to modernize electricity distribution, enhancing the infrastructure of 25 rural cooperatives. The new tenders signal Bangladesh’s ongoing commitment to clean energy and its transition to sustainable power solutions.
NEPAL
NEPAL SECURES NPR 4.75 BN (USD 34.5 MN) FROM CARBON TRADING, AIMING FOR 28,500 MW RENEWABLE ENERGY BY 2035
Nepal has earned NPR 4.75 Bn (USD 34.5 Mn) from Carbon Trading. Nepal had earned USD 2.87 Mn from carbon trading in the last fiscal year. The Alternative Energy Promotion Centre has earned income from 8 carbon trading projects since 2011. The government would provide possible support for promoting the renewable energy sector.
The Nepal government has set an ambitious target to generate 28,500 MW of hydroelectricity by 2035, to export electricity to neighboring countries to boost foreign currency earnings. An agreement has been reached to sell 10,000 MW of electricity to India and the government has also recently inked an agreement with Bangladesh to export 40 MW of electricity. Domestic consumption is also increasing and within a decade, domestic power demand will reach more than 13,000 MW.
WORLD BANK APPROVES USD 100 MN TO SUPPORT NEPAL’S POLICY FRAMEWORK FOR GREENER, MORE RESILIENT, AND INCLUSIVE DEVELOPMENT AND GROWTH
The World Bank has approved a USD 100 Mn development policy operation (DPO) to help Nepal strengthen its ongoing efforts to implement green, resilient, and inclusive development. This is the second in a programmatic series of three DPOs that aims to improve the enabling environment for Nepal's sustainability pathway.
This programmatic DPO series is a catalyst for Nepal to build greater resilience and sustainability and drive and protect the basis for long-term growth for all Nepalis. This operation supports Nepal’s policy program in a variety of sectors including green fiscal instruments, water security, irrigation, land use and management, sustainable forest management, and climate and disaster information systems.
The World Bank DPO series anchors Nepal’s ongoing shift to a more sustainable development path. Nepal’s policies supported by the DPO series arose from stakeholder dialogues and Nepal’s development priority programs and plans. These policies aim to improve air quality, expand hydro-meteorological services to better disaster risk reduction, improve water security by boosting year-round irrigation and safe water supply, strengthen community forest management, and enhance land use planning.
NEPAL, CHINA SIGN AGREEMENT TO ADVANCE BELT AND ROAD INITIATIVE- KEY DETAILS OF THE TRANS-HIMALAYAN PROJECT
Nepal and China signed the much-anticipated Belt and Road Initiative (BRI) Cooperation Framework, a significant agreement expected to pave the way for the execution of BRI projects. The BRI aims to create a vast network of infrastructure projects linking China to Southeast Asia, Central Asia, Russia, and Europe. Despite Nepal and China having signed the BRI agreement in 2017, no projects have yet been implemented under the initiative. The new framework agreement is seen as a crucial step towards realizing these projects.
Both countries expressed their readiness to sign an MoU on building the Trans-Himalayan Multi-Dimensional Connectivity Network (THMDCN), focusing on enhancing connectivity in areas such as ports, roads, railways, aviation, power grids, and telecommunications. This initiative is expected to help Nepal transition from a landlocked to a land-linked country. While specific timelines for the projects were not provided, the agreement sets the stage for greater cooperation.
One key negotiation point in the agreement was the language surrounding financial support for the BRI projects. Initially, the Nepali side suggested the term “grant,” but the Chinese side proposed replacing it with “investment.” After discussions, both sides agreed on a compromise, including the term “aid and technical assistance” for project execution. This wording reflects a shift from a clear definition of grants, with some projects potentially being funded through lines of credit, which could involve loans.
BHUTAN
MAJOR SOLAR AND HYDROPOWER PROJECTS IN BHUTAN: A COLLABORATION BETWEEN RELIANCE GROUP AND DHI
Reliance Group has established a new company, Reliance Enterprises, specifically focused on promoting investment in Bhutan’s renewable and green energy sector. The company is jointly promoted by Reliance Infrastructure and Reliance Power. One of the key projects is a 500 MW solar plant, which will be executed over the next two years in two phases of 250 MW each.
Additionally, Reliance Power and Druk Holding are collaborating on developing the 770 MW Chamkharchhu-1 hydro project. In this joint venture, Reliance Power will hold a 49% stake, while Druk Holding will be the majority partner with 51% ownership. The Chamkharchhu-1 project is classified as a run-of-the-river hydro project and will be executed under a concession model in accordance with the policies of the Royal Government of Bhutan (RGOB).
TATA POWER, BHUTAN'S DRUK GREEN POWER CORP TO DEVELOP 5,000 MW CLEAN ENERGY PROJECTS
Tata Power has entered into a strategic partnership with Bhutan's Druk Green Power Corporation Ltd (DGPC) for the development of 5,000 MW of clean energy capacity in the Himalayan nation. DGPC, is a subsidiary of Druk Holding and Investments Ltd, the sole generation utility of Bhutan. The collaboration marks the largest partnership between two of the leading power companies of the two nations in Asia's clean energy sector, Tata Power. Through the collaboration, at least 5,000 MW of renewable energy projects; 4,500 MW of hydropower comprising the 1,125 MW Dorjilung HEP (hydro-electric project); 740 MW Gongri Reservoir; 1,800 MW Jeri Pumped Storage; and 364 MW Chamkharchhu IV will be developed in phases.
This strategic partnership with Tata Power is in keeping with Bhutan's aspirations to maximize benefits to the people of Bhutan through fast-tracking and harnessing its huge renewable energy resources for its economic development and long-term energy security. Tata Power has had a long-standing relationship with DGPC since 2008, when the two companies joined forces to successfully develop the 126 MW Dagachhu Hydropower Plant as the first Public-Private Partnership in Bhutan's hydropower sector. Tata Power also has a transmission project of a 1,200-km-long Tala transmission line that evacuates clean power from Bhutan to India. As a precursor to this collaboration, Tata Power recently acquired a 40 % stake in the 600 MW Khorlochhu Hydroelectric Project.
PM MODI, BHUTAN KING DISCUSS COOPERATION FOR GELEPHU SPECIAL ADMINISTRATIVE REGION
India and Bhutan discussed cooperation for the Gelephu special administrative region. The “Gelephu Mindfulness City” or economic hub located close to the Indian border, and India’s support for Bhutan’s 13th Five Year Plan (2024-29) and Economic Stimulus Programme were among the major issues that figured in the discussions between the two countries.
As part of efforts to counter China’s growing presence in the region, India this year doubled its financial support for Bhutan’s five-year plan from INR 5,000 Cr (USD 587 Mn) to INR 10,000 Cr (USD 1.1 Bn). Bhutanese side thanked the Indian government for stepping up development support under the 13th Five Year Plan (2024-29) and for backing Bhutan’s Economic Stimulus Programme.
With clean energy cooperation forming an important pillar of the bilateral partnership, the leaders reviewed progress in the energy sector, including in non-hydro renewable energy, through access to Indian financing and energy markets. The 1020-megawatt Punatshangchhu-II hydropower project is currently nearing completion and the leaders agreed on the need for early conclusion of the Punatsangchhu-I hydropower project. The two sides agreed to enhance cooperation in hydropower through “finalising modalities urgently for new projects, including reservoir hydro projects”.
SRI LANKA
INDIA HANDS OVER ROOFTOP SOLAR SYSTEMS AT RELIGIOUS SITES IN SRI LANKA
India has handed over rooftop solar systems to multiple religious locations in Sri Lanka in continuation of its energy partnership with the island nation. This initiative is part of a USD 17 Mn Indian project which aims to install 25 MW solar rooftop systems across 5,000 religious institutions throughout the island nation. Designed to reduce energy expenses and support Sri Lanka's shift toward renewable energy, the project spans all nine provinces and 25 districts.
The project will supply about 37 million units annually and contribute to Sri Lanka's "people-centric energy transition". The project is designed to reduce energy costs for these institutions. This effort aligns with India's "Neighbourhood First" policy emphasizing cooperation on Sri Lankan priorities. Other renewable projects include solar electrification of around 9000 Buddhist Temples and Pirivenas with grant assistance of USD 10 Mn, and hybrid renewable energy projects in the three islands off Jaffna. LNG supply, infrastructure development, and the solar power plant at Sampur are among the largest projects.
ELECTRIC BUSES ACCELERATE RENEWABLE TRANSITION IN SRI LANKA
With the support of the UNDP, the government of Sri Lanka developed pilot projects for both electric tuk-tuks and public buses. The CCAC has joined the UNDP in supporting the pilot project on a modern public transport system with e-buses, which would provide a platform for scaling up with funding from the GCF. Preparations for the pilot will include developing a comprehensive Sustainable Low-Carbon Transport Plan, a comprehensive regulatory framework for electric bus mobility, a feasibility study for the impact on the electricity grid, and a technical, operational financial and regulatory viability assessment of EV charging technology standards and suitability.
The pilot project will gather data and prove the business case for further green investment funding for expansion of electric bus services. It will do so through the piloting of a tailored financial product for local governments and interested private investors in Sri Lanka, which takes into account electricity capacity and fare considerations in a financially viable model. This financial product will help private sector stakeholders such as large textile manufacturers who provide bus transport for workers to electrify their fleets as a part of their commitments to Sri Lankas renewable energy transition. Total investment needs for electric buses are not yet known, however the UNDP’s experience with the Tuk-Tuk fleet showed that to electrify the 1.2 mn-strong fleet would cost USD 5 Bn.
ADB LOAN TO ADVANCE POWER SYSTEM EXPANSION AND RENEWABLE ENERGY INTEGRATION IN SRI LANKA
The Asian Development Bank (ADB) has approved a USD 200 Mn loan to upgrade Sri Lanka's power sector infrastructure, enhancing the reliability of transmission and distribution networks and facilitating greater integration of renewable energy.
Driving power sector reforms, combined with targeted infrastructure interventions, is essential to facilitate competitive renewable energy development and reduce power generation costs. Sri Lanka achieved 100% household electrification in 2016. Peak demand reached around 2,800 megawatts (MW) in 2023, including contributions from distributed renewable energy, and is projected to grow significantly by 2030. While Sri Lanka’s total installed power generation capacity reached 5,191 MW in 2023, about 50% of the country’s electricity generation in 2023 came from thermal power plants, underscoring the challenges in transitioning to a more sustainable energy mix. In its updated nationally determined contribution, the government has set an ambitious target of 70% electricity generation from renewables by 2030 and carbon neutrality in electricity generation by 2050.
The Power System Strengthening and Renewable Energy Integration Project will enhance climate resilience and expand the capacity of transmission and distribution networks, enabling greater integration of renewable energy. The project will expand the 220-kilovolt and 132-kilovolt transmission infrastructure with new transmission lines and substations, modernize the medium voltage distribution network, and upgrade grid protection systems. The project will introduce Sri Lanka’s first grid-scale battery energy storage system at the transmission level, establish a renewable energy center to forecast and monitor renewable energy generation, and implement network automation systems with SCADA and remote terminal units, providing operators with real-time data and alerts to ensure efficient power delivery.
List of key transactions - Bangladesh ,Nepal, Bhutan and Sri Lanka Q4 2024

Source: YOG INFRA analysis
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