Sri Lanka gets more Indian aid for coal power plant

Directory launched in the presence of Jagath Perera, CA Sri Lanka President, Manil Jayesinghe, CA Sri Lanka Vice President, Harsha Basnayake, Ernst & Young Asia Pacific Transaction Advisory Managing Partner, Aruni Rajakarier, Chairperson of the CA Sri Lanka Women Empowerment Committee, Anoji De Silva, Alternate Chair of the Women Empowerment Committee and Dulani Fernando, CA Sri Lanka CEO

Nov 26, 2010 (LBO) – India is giving Sri Lanka a 200 million US dollar soft loan to help its cash-strapped power utility proceed with a joint venture 500 MegaWatt power plant on island’s east coast, a statement said. India is also offering financial support for the equity contribution of the Ceylon Electricity Board (CEB) to set up the joint venture with India’s National Thermal Power Corporation (NTPC) for the coal power plant at Sampur, near the Trincomalee port.

The state-run power utility has been running up large losses, by delaying coal plants and selling power below its cost of production.

The 200 million dollar loan is to build a jetty at Sampur to unload coal and a transmission line from Sampur to north-central Habarana, said the statement issued Friday, at the end of the sessions of the Indo-Lanka joint commission, a forum to sort out trade links.

The talks were co-chaired by visiting Indian foreign minister S M Krishna and Gamini Peiris, Sri Lanka’s foreign minister.

The Joint Venture agreement for the power plant, the Power Purchase Agreement, the agreement with the Board of Investment of Sri Lanka, the implementation agreement and other relevant arrangements had also been agreed upon.