Kerala delegation, Chinese company ink MoU
09 September 2002
The Kerala delegation currently touring China has
signed two memorandums of understanding (MoUs) with a
Chinese company, the International Network Small Hydro
Power (INSHP), for the manufacture of equipment for small
The MoUs have cleared the way for the first foreign direct investment (FDI) into the state from China, says Kerala Industries Minister P K Kunhalikutty, who is leading the delegation to China. The preliminary investment in the projects by the Chinese side is estimated at $2.9 million.
The FDI will be for implementing a joint venture (JV) with the Steel Industries Kerala Ltd (SILK) for manufacturing turbines for small hydel schemes. It will also be associating with Keltron for setting up a manufacturing facility for control and instrumentation equipment needed for small hydel schemes.
Kunhalikutty says the move to strike this tie-up was initiated by the former industries minister, late Suseela Gopalan, when she visited China in 2001. The matter was followed up and got moving during the visit of Electricity Minister Kadavoor Sivadasan to China last month.
INSHP is a world leader in small hydel schemes. The United Nations International Development Organisation, the Chinese government and other key organisations in the sector established it jointly. The company has so far associated itself in setting up more than 48,000 such schemes worldwide. The two JVs are targeting the small hydel market in Kerala and other states, besides Sri Lanka, Bangladesh, Bhutan and Nepal.
INSHP director-general Tong Jiangdong says China is having nearly 50,000 small hydel stations, generating more than 28,000mw of electricity. These schemes considerably ease the pressure for thermal power generation in China.
The Chinese experience is particularly significant in the context of the problems being faced in Kerala due to the compulsion to purchase thermal power at a high cost.
Jiangdong told the visiting delegation that a stabilised technology is available with INSHP for setting up small hydel stations even in places where the gradient is just three metres. Kerala, which has more than double the rainfall in China and possessing a natural sloping terrain, has excellent potential for power generation through this technology.
The Kerala delegation visited a rubber dam site and a power-generating station in Tong Lu County, near Hangshou, and had discussions with INSHP authorities and other experts to gather information on the scope of small hydel schemes. The delegation was fully convinced that this technology has immense potential in Kerala.
Kerala deputy leader of the opposition Kodiyeri Balakrishnan, Kerala Pradesh Congress Committee president K Muraleedharan, MLA Aryadam Mohammed, Keltron managing director Ajay Kumar and IT secretary Aruna Sundararajan are among the delegation.