China Gezhouba Group of Company (CGGC) Limited has objected to the government's decision to scrap the Memorandum of Understanding (MoU) signed with it for development of Budhi Gandaki Hydroelectric Project

According to a new report published in My Republica, it has termed the decision 'unilateral' and 'invalid'. In its letter sent to the Ministry of Energy dated November 17, the Chinese company has said that it would refuse the unilateral declaration to terminate the MoU.

“The government had scrapped the MoU on November 13, citing the decisions of the erstwhile Finance and Agriculture and Water Resources committees. The company, which was entrusted the 1200-megawatt reservoir plant as per the MoU signed in June by the former government led by UCPN Maoist (Center), has expressed reservation over the decision, saying that it was also not given prior information of the termination as per the Clause 9 of the MoU,” My Republica writes.

Clause 9 of the MoU states that other party should be notified about termination by giving a 30-day notice along with reasons to do so.

An excerpt of the letter addressed to senior divisional engineer of MoE, Raju Maharjan, reads: “The abrupt action on behalf of the Government of Nepal to terminate MoU specifies no ground nor we bound by any reasons to the decision of the termination, which in itself didn't entertain the basic rule of game as stipulated under Clause 9 of the MoU.”