The aim is to eventually sign a memorandum of understanding between state-owned Power Grid Corporation of India and Sri Lanka’s Ceylon Electricity Board, said people familiar with the matter. “Discussion is still going on with the Sri Lankan government on the grid connectivity project,” an Indian government official said. The grid connectivity project is being planned through both overhead and under-sea cables, a second official added.
Power Grid didn’t respond to ET’s queries.
The cross-border interconnection plan has been under discussion for nearly two decades, but high project cost has made it unviable. Discussions got a fresh thrust last year amid India’s plans to have grid interconnectivity with countries such as Saudi Arabia and UAE. After getting a new direction in the talks last fiscal, the Ceylon Electricity Board assigned a financial analysis study to PwC India for assessing the likely economic benefits of the project to Sri Lanka. PwC’s draft report had suggested the link to be financially beneficial, as reported earlier by ET.
The study had suggested a mix of long-term, medium-term, and short-term tie ups for securing power from various available sources. Sri Lanka’s power and energy minister Kanchana Wijesekera told ET in February that technical feasibility studies have been done and a joint consultant for investment decisions would be appointed for the grid connectivity project. The renewed focus on power interconnectivity with Sri Lanka gains importance in the backdrop of India’s push to forge closer ties with its neighbours.
A joint statement during Sri Lankan President Ranil Wickremesinghe’s visit to India in July last year had talked about an MoU on cooperation in developing renewable energy, including its potential in offshore wind and solar. The statement also spoke about setting up a high-capacity power grid link to enable bidirectional electricity trade between Sri Lanka and other regional countries, including Bangladesh, Bhutan, Nepal.
