The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved investment of Rs 5,281.94 crore for 850 MW Ratle Hydro Electric (HE) Project located on river Chenab in Kishtwar district of the Union Territory of Jammu and Kashmir, by a new joint venture company (JVC) to be incorporated between the National Hydroelectric Power Corporation (NHPC) and the Jammu & Kashmir State Power Development Corporation (JKSPDC) with equity contribution of 51 percent and 49 percent respectively.
The Centre is also supporting the Union Territory by providing grant of Rs 776.44 crore for equity contribution of JKSPDC in the JVC to be set up for construction of hydro-electric project. NHPC will invest its equity Rs 808.14 crore from its internal resources.
The hydro-electric project will be commissioned within a span of 60 months. The power generated from the project will help in providing balancing of grid and improve the power supply position.
The government of Union Territory of Jammu and Kashmir, to make the project viable, will extend exemption from levy of water usage charges for 10 years after commissioning the project, reimbursement of the state's share of GST (i.e. SGST) and waiver of free power to the Jammu and Kashmir in a decremental manner, i.e., the free power to the Union Territory will be one percent in the first year after commissioning of the project and rising at the rate of one percent per year to 12 percent in the 12th year.
The construction activities of the project will create direct and indirect employment to around 4,000 people and contribute in overall socio-economic development of the Union Territory.
Further, the Union Territory will be benefitted by getting free power worth Rs 5,289 crore and through levy of water usage charges worth Rs 9,581 crore from the hydro-electric project during project lifecycle of 40 years.