KIGALI - Government has signed an agreement with Exim Bank of India which will see the Indian bank extend a line of credit of $60 million to finance the construction of Nyabarongo Hydro Power project.
The agreement signed last week between the Ministry of Finance and Exim Bank is an addition to an earlier agreement in which the Indian bank extended a loan of $20 million in the first tranche to finance construction of the hydro power project.
According to the State Minister for Energy, Collette Uwineza Ruhamya, the money will be released in different phases as construction work on $97.7m goes on for 45 months from May 2009.
“The remaining part of Rwf4bn will be financed by the Government. The Government will also take care of the supervision company at a cost of $4.5m. The initial $20m have been already released to procure material and prepare the site,” Uwineza told The New Times.
The project is being executed by Bharat Heavy Electricals Ltd and Angelique International.
According to Exim Bank, it will reimburse 100 per cent of contract value to the Indian exporters, upfront upon the shipment of goods.
The loan will be used for financing at least 85 per cent of the total contract value through sourcing of goods and services from India.
According to Uwineza, works on what is slated to be the country’s biggest hydro-electric power plant along River Nyabarongo are making good progress.
She noted that the access road to the site is nearing competition and ground works are expected to begin soon. She however, said that there were delays caused by the bureaucracy involved in shipping in equipment from India and clearing with MAGERWA.
When completed, the plant will generate 27.5 Mega Watts of electricity which will be a major boost to the national power grid. The project is expected to be completed in 2013.