1
Session-4 Theme Presentation on
Creating Conducive Environment-Regional Investment Framework for Mobilizing Investment in Regional Energy
Infrastructure projects in South Asia
Presented by
Rajiv Ratna Panda, Technical-Head, SARI/EI/IRADe
Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19th
February 2020, Hotel Imperial, New Delhi, India
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
South Asia Regional Initiative for Energy Integration
High Level Panel Discussion on Creating Conducive Environment for Investment in Regional Energy Infrastructures Projects in South Asia
2
Marco Economic Growth & Level of Economic Integration of South Asia
Success story of South Asia Energy/Power Sector
Challenges of South Asia Energy/Power Sector
Emerging Trends and Future Scenario
South Asia Energy/Power Sector: Investment Requirements
Opportunities and Challenges: Future Energy Investment
Regional Investment Framework
Points for Discussions
Contents
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
3
Macro Economic Growth
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
4South Asia : One of most Populous Region in the world
South Asian Growth Story : Dynamic and Vibrant
South Asia 1.8 Billion (23% world Population)
China 1.39 Billion
India 1.35 Billion
EU 0.51 Billion
US 0.32 Billion Data Source: World Bank Data base
USAUS$ 21.43
Trillion
China US$ 14 Trillion
India US $ 2.9 trillion
Japan US$ 5.15 Trillion
Germany US$ 3.8 Trillion
South AsiaUS$ 3.66 Trillion
UK US $ 2.7 trillion
World 7.5 Billion
Source: IMF- World Economic Outlook (October 2019
and 5th Largest Economy in the World
3.4
5.2
2.2
2.7
6.7
5.2
-6
-4
-2
0
2
4
6
8
10
12
Real GDP Growth Annual Percent ChangeSource: World Economic Outlook (October 2019)
Africa (Region) East Asia Europe
North America South Asia Southeast Asia
South Asia : Fastest growing region in the world and Expected to Remain So in future
Source: IMF- World Economic Outlook (October 2019, https://www.imf.org/external/datamapper/NGDP_RPCH@WEO/SAQ/EAQ/EUQ/SEQ/AFQ
5South Asia : Bangladesh, India–the fastest growing large economy among South Asian Countries
7.9
6.8
7.5
6.7
6.7
0
1
2
3
4
5
6
7
8
9
10
-20
-15
-10
-5
0
5
10
15
20
25
30 South Asian Country -Real GDP growth (Annual percent change) World Economic Outlook (October 2019)
Afghanistan Bangladesh Bhutan India Maldives Nepal Pakistan Sri Lanka South Asia
Source: IMF- World Economic Outlook (October 2019, https://www.imf.org/external/datamapper/NGDP_RPCH@WEO/AFG/BGD/BTN/IND/MDV/NPL/PAK/LKA
South Asia : Robust Growth
6
Economic Integration of South Asian Countries
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
7
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
South Asia : Yet ……………….. Least Integrated
7.6
57.5
35.5
6.3
16.0
63.8
23.1
15.5
13.7
46.5
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Intra-regional Trade Share (%) (Intra-regional trade to total trade of the region)
Central Asia Asia and the Pacific East Asia SAARCAfrica EU ASEAN Latin America and CaribbeanMiddle East ASEAN+3
Region
Intra-regional Trade Share
(%) 2018
EU 63.8Asia & Pacific 57.5
ASEAN+3 46.5
East Asia 35.5
ASEAN 23.1
Africa 16.0Latin
America & Caribbean 15.5
Middle East 13.7
Central Asia 7.6
SAARC 6.3
Source: The Integration Indicators Database https://aric.adb.org/database/integration ASEAN+3 consists of the 10 ASEAN member economies, the People’s Republic of China (including Hong Kong, China), Japan, and the Republic of Korea.
8South Asia : Intra-regional trade (Asia) increased but is still low in comparison to other sub-regions of Asia
19.2
28.1
33.3
52.5
55.1
55.5
29.3
35.4
40
61.6
68.1
69.3
56.8
68.9
71.7
80.8
71.9
66.7
47.5
44.9
44.5
70.7
64.6
60
38.4
31.9
30.7
43.2
31.1
28.3
0 10 20 30 40 50 60 70 80 90 100
2000
2010
2018
2000
2010
2018
2000
2010
2018
2000
2010
2018
2000
2010
2018
Ce
ntr
al A
sia
East
Asi
aSo
uth
Asi
aSo
uth
east
Asi
a
The
Pac
ific
and
Oce
ania
Intraregional Rest of the World
South Asia : Intraregional Trade Shares by Asian Sub-regions
Intraregional Trade Shares (Asia) Rest of the World
Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, IndiaSource: Asian Economic Integration Report
9
Key Investment Scenario in South Asia
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
10
2018-Asia -512 B US $, North America -291 B US $ , South Asia-50 B US $
512
291 280
31
51
0
100
200
300
400
500
600
700
800
2010 2011 2012 2013 2014 2015 2016 2017 2018
Major Regions in the world FDI inflow(B US$ )South Asia is one of the Lowest
Asia North AmericaEast Asia EuropeSouth-East Asia Latin America and the CaribbeanSouth America South AsiaAfrica
3.6
42.2
2.3
-5
0
5
10
15
20
25
30
35
40
45
50
2010 2011 2012 2013 2014 2015 2016 2017 2018
FDI inflows, in Billion USDSouth Asia
Afghanistan Bangladesh Bhutan India
Maldives Nepal Pakistan Sri Lanka
South Asia : FDI Inflows
2018-India: 83% (42 B US $) , Bangladesh 7% (3.6 B US $), Pakistan 4% ( 2.3 B US $)
Source : UNCTAD Database, accessed on 9-02-2020
Source : UNCTAD Database, accessed on 9-02-2020
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
11
South Asia : Share of FDI in Asia , 9.1 % , East Asia & South-east Asia Dominates
7.8% 9.0%6.4% 7.3% 7.6% 9.3% 9.8% 9.0% 9.1%
-
100
200
300
400
500
600
2010 2011 2012 2013 2014 2015 2016 2017 2018
FDI I
nw
ard
(U
SD B
illio
n)
Global Inward FDI to Asia by Destination Sub-region
Southeast Asia East Asia South Asia
Central Asia The Pacific & Oceania % Share - SA
3.3% 4.0% 2.9% 3.4% 5.0%8.0% 7.8% 7.0% 8.6%
-
50.0
100.0
150.0
200.0
250.0
300.0
2010 2011 2012 2013 2014 2015 2016 2017 2018
FDI I
ntr
areg
ion
al (
USD
Bill
ion
)
Intraregional FDI Inflows—Asia
Southeast Asia East Asia South Asia
Central Asia The Pacific & Oceania % Share - SA
South Asia : FDI
South Asia : Share of Intraregional FDI in Asia , 8.6 % , East Asia & South-east Asia Dominates
Source: Asian Economic Integration Report Source: Asian Economic Integration ReportRegional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
12
Energy/Power Sector Scenario : Success story of South Asia
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
13
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
5.27
22.79
158.20
368.28
20.92
39.15
2.82
4.05
- 50.00 100.00 150.00 200.00 250.00 300.00 350.00 400.00 450.00 500.00
FY10
FY11
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
Rapid Capacity Addition : Power Installed Capacity (GW)
Afghanistan Bangladesh Bhutan India
Maldives Nepal Pakistan Sri Lanka
Energy/Power Sector Scenario : Success story of South Asia
Bangladesh : 5.2 GW in 2010 to22. 8 GW by 2020, India : 158 GW in 2010 to 368 GW by 2020, Pakistan : 20.9 GW in 2010 to 39 GW by 2020
2012
2015
2018
2020
~1350 MW
~2076 MW
~2986 MW
~3560 MW
Across the Region - : India-Myanmar ~ 3-5 MW of CBET , Pakistan-Iran ~ 104 MW CBET, Afghanistan- Imports around 1000 MW collectively from Uzbekistan (326 MW) , Iran (164 MW) , Tajikistan (433 MW) ,Turkmenistan (77 MW) , Source: Compiled from Various Sources , PM Modi inaugurated Mangdechhu hydroelectric plant, Bhutan, Aug 17, 2019
Expansion in Cross Border Power Trade (MW)
Source: Compiled from various sources - IEA, World Energy Outlook-2019,https://data.worldbank.org/indicator/EG.ELC.ACCS.ZS?locations=BT-MV-IN-LK-AF-PK-NP-BD
14
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
5.27
22.79
158.20
368.28
20.92
39.15
2.82
4.05
- 50.00 100.00 150.00 200.00 250.00 300.00 350.00 400.00 450.00 500.00
FY10
FY11
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
Rapid Capacity Addition : Power Installed Capacity (GW)
Afghanistan Bangladesh Bhutan India
Maldives Nepal Pakistan Sri Lanka
Energy/Power Sector Scenario : Success story of South Asia
Bangladesh : 5.2 GW in 2010 to22. 8 GW by 2020, India : 158 GW in 2010 to 368 GW by 2020, Pakistan : 20.9 GW in 2010 to 39 GW by 2020
2012
2015
2018
2020
~1350 MW
~2076 MW
~2986 MW
~3560 MW
Across the Region - : India-Myanmar ~ 3-5 MW of CBET , Pakistan-Iran ~ 104 MW CBET, Afghanistan- Imports around 1000 MW collectively from Uzbekistan (326 MW) , Iran (164 MW) , Tajikistan (433 MW) ,Turkmenistan (77 MW) , Source: Compiled from Various Sources , PM Modi inaugurated Mangdechhu hydroelectric plant, Bhutan, Aug 17, 2019
Expansion in Cross Border Power Trade (MW)
0%
20%
40%
60%
80%
100%
120%
2000 2005 2010 2015 2018 2019
Significant Achievement in Access to Electricity
Proportion of the population (%) with access to electricity
India Bangladesh Nepal Pakistan Sri Lanka Bhutan Afghanistan
Source: Compiled from various sources - IEA, World Energy Outlook-2019,https://data.worldbank.org/indicator/EG.ELC.ACCS.ZS?locations=BT-MV-IN-LK-AF-PK-NP-BD
15
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Energy/Power Sector Scenario : Success story of South Asia
23%
5% 5%
59%
99.20%
12%
95%
29%44%
0%
20%
40%
60%
80%
100%
120%
Renewable Gas Oil Coal Hydro
Green Has been Growing in SA countries,India: 13 GW in 2009 to 86 GW in 2020
Power Mix of South Asian Countries (2019)
Green Energy (RE+ Hydro) in most of the Countries
37 37 38 39 39 41 41 43 44 45 45 45
94 102 113132
152168
189211 218 223 226 230
1316
18
25
28
35
39
4657
6978
86
0
50
100
150
200
250
300
350
400
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
India Electricity Installed capacity Growth (GW)
Large Green Energy Capacity Addition
Hydro Thermal* Nuclear RES
148159
174
200
223
249
275
305
327344
356368
42%
47% 48%
57.07
0
10
20
30
40
50
60
70
Bangladesh(2018-19)
India (2020) Nepal (2019) Pakistan(2018)
Significant Private Sector Participation in Generation
% Power Capacity by Public Sector (MW)
% Power Capacity by Private Sector (MW)
Bangladesh -42%, India , 47%, Nepal-48%, Pakistan-57%
16
Energy/Power Sector Scenario : Challenges
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
17
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
2976
1149 969 725 658 548 375 190 100
3132
3927 4197
5908
7819
9401
10496
12993
0
2000
4000
6000
8000
10000
12000
14000
Electric power consumption (kWh per capita)
Despite High Economic Growth, Rapid Capacity Addition, Per Capita Electricity Consumption is low
Source: Compiled and Calculated from various sources I Bhutan , India, Sri Lanka, Pakistan, Bangladesh**, Nepal, Afghanistan * Maldivies I Afghanistan, Bhutan and Nepal are calculated values I USA , South Korea , Saudi Arabia, JAPAN, EU, South Africa, CHINA –data is 2014 world Bank database.
18
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Economy
% of firms experiencing
electrical outages
No. of electrical
outages in a typical month
If there were outages, average duration of a
typical electrical outage (hours)
If there were outages, average
losses due to electrical outages (%
of annual sales)
Percent of firms owning or sharing a
generator
If a generator is used, average proportion of
electricity from a generator (%)
Days to obtain an electrical connection
(upon application)
% of firms identifying
electricity as a major constraint
All Countries 58.4 6 4.5 4.3 35 18.4 34.8 32.8
East Asia & Pacific 56.8 4.2 3.4 3 35 16.2 18 18.2
Europe & Central Asia 31.4 0.8 3 1.2 18.7 8.3 35.6 21.9
Latin America & Caribbean 64.8 2.1 2.7 1.7 26 14.5 32.1 36.6
Middle East & North Africa 50.2 13.8 8.7 5.1 41.3 26.8 53.1 37.8
South Asia 66.2 25.4 5.3 10.9 45.4 24.4 55.1 46.1
Sub-Saharan Africa 76.2 8.3 6.4 7.8 51 26.9 35.4 41.2
Source: https://www.enterprisesurveys.org/en/data/exploretopics/infrastructure , This is computed using data from manufacturing firms only.
Quality is a Concern, reliability and availability of Electricity infrastructure
South Asia : reliability & availability of Electricity infrastructure is concern. Need to focus on Quality
19
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Source: https://www.enterprisesurveys.org/en/data/exploretopics/infrastructure
Economy
Percent of firms
experiencing electrical
outages
Number of electrical
outages in a typical month
If there were outages, average
duration of a typical electrical outage (hours)
If there were outages,
average losses due to electrical
outages (% of annual sales)
% of firms owning or sharing a generator
If a generator is used, average proportion of
electricity from a generator (%)
Days to obtain an electrical
connection (upon
application)
% of firms identifying
electricity as a major
constraint
South Asia 66.2 25.4 5.3 10.9 45.4 24.4 55.1 46.1
Afghanistan 70.4 11.5 3.8 9.6 48 38.3 111.3 65.8
Bangladesh 73.4 64.5 1.2 5.5 62.8 26.1 84.7 52
Bhutan 44.2 0.4 8.1 3.7 9.5 10.2 21.3 14.1
India 55.4 13.8 2 3.7 46.5 8.8 21.9 21.3
Nepal 62.8 8.7 3.6 17 50.5 41.3 21.3 68.8
Pakistan 81.1 75.2 16.9 33.8 65.4 41.4 82.8 75.3
Varies among South Asian Countries
Quality is a Concern, reliability and availability of Electricity infrastructure
20
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Cost of power sector distortions in South Asia: Bangladesh-11.1 Billion US$ , India-86.1 Billion US$, Pakistan-17.7 Billion US$
Cost of power sector distortions in South Asia
11.2billion US$
86.1billion US$
17.7billion US$
Bangladesh5% GDP
India4.13 % GDP
Pakistan6.5% GDP
0
1
2
3
4
5
6
7
0
10
20
30
40
50
60
70
80
90
100
Bangladesh (2016) India (2016) Pakistan (2015)
Cost of power sector distortions in South Asia
total economic cost In billion USD
Cost of power sector distortions in India at a glancepercent of GDP
0 1 2 3 4 5 6 7
Fiscal (% GDP)
Institutional (% GDP)
Regulatory (% GDP)
Social (% GDP)
Cost of power sector distortions in South Asian Countries (% of GDP)
Pakistan (2015) India (2016) Bangladesh (2016)
Source : World Bank Report on “ In the Dark How Much Do Power Sector Distortions Cost South Asia? FAN ZHANG
21
South Asia Energy/Power Sector: Emerging Trends and
Future Scenario
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
22
1.3 (0%)
2.2(1%)
22 (5%)
364 (84%)
1.2 (0%)
4 (1%)
36 (9%)
.5 (0%)
Current South Asia-Power Installed Capacity (GW)
Afghanistan (2017) Bhutan(2019) Bangladesh(2019) India (Nov-2019)
Nepal (2019) Sri Lanka (2018) Pakistan (2018) Maldivies (2017)
7(1%)
14.8(2%)
67.8(6%)
783(73%)
9.3 (1%)
11.7 (1%)
173(16%)
1(0%)
South Asia Power Installed Capacity (GW)-2040*
Afghanistan Bhutan Bangladesh India Nepal Sri Lanka Pakistan Maldivies
* Projection as per the World Bank Report on “How Much Could South Asia Benefit from Regional Electricity Cooperation and Trade? “ For Maldives 1000 MW of capacity is Assumed by 2040.
432 GW 1068 GW
Source: Compiled from Various Sources
South Asia Power Sector: 1068 GW by 2040
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
23
SAARC -Significant Environment/Climate Change Challenge
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Afghanistan Bangladesh Bhutan India Maldivies Nepal Pakistan Sri Lanka
3.439.8
0.3
1212.9
0.3
0.0
44.4
8.2
0.9
13.6
0.0
194.8
0.1
2.0
20.2
1.3
5.1 11.9
0.1
289.3
0.5
4.137.6
9.9
0.7
17.2
0.3
671.9
0.1
3.165.3
1.7
0.310.4
0.9
253.10.0
1.2 28.7 2.6
SAARC Countries-fossil_CO2_by_sector_ in Mt CO2/yr (2018)
Power Industry Buildings Transport Other industrial combustion Other sectors
source: Climate Emergency CoP 25: India is the only major economy to be ‘2 degree compatible’ , Fossil CO2 and GHG emissions of all world countries 2019 Report-JRC SCIENCE FOR POLICY REPORT https://edgar.jrc.ec.europa.eu/booklet2019/Fossil_CO2andGHG_emissions_of_all_world_countries_booklet_2019report.pdf
Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
24
SAARC -Significant Environment/Climate Change Challenge
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Afghanistan Bangladesh Bhutan India Maldivies Nepal Pakistan Sri Lanka
3.439.8
0.3
1212.9
0.3
0.0
44.4
8.2
0.9
13.6
0.0
194.8
0.1
2.0
20.2
1.3
5.1 11.9
0.1
289.3
0.5
4.137.6
9.9
0.7
17.2
0.3
671.9
0.1
3.165.3
1.7
0.310.4
0.9
253.10.0
1.2 28.7 2.6
SAARC Countries-fossil_CO2_by_sector_ in Mt CO2/yr (2018)
Power Industry Buildings Transport Other industrial combustion Other sectors
0.9
1.9
2.9
8.021.0 16.1
8.5
6.8
4.2
5.0
0.0
5.0
10.0
15.0
20.0
25.0
0
500
1000
1500
2000
2500
3000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Fossil CO2 Emission by Sector-India (Mt CO2/yr ) & Per Capita (t CO2/cap/yr)
Power Industry Buildings TransportOther industrial combustion Other sectors India t CO2/cap/yrChina t CO2/cap/yr United States t CO2/cap/yr EU28 t CO2/cap/yrGLOBAL-t CO2/cap/yr
China 11256 (30%)
India-2622 (7%)
US-5275 (14%)
EU-3457 (9%)
Rest of World 15277 (40%)
Fossil CO2 Emission in Mt CO2/yr (% Share)4 Nations -60% Global Emission
China India
United States EU28
Rest of the Worldsource: Climate Emergency CoP 25: India is the only major economy to be ‘2 degree compatible’ , Fossil CO2 and GHG emissions of all world countries 2019 Report-JRC SCIENCE FOR POLICY REPORT https://edgar.jrc.ec.europa.eu/booklet2019/Fossil_CO2andGHG_emissions_of_all_world_countries_booklet_2019report.pdf
Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
25
14%
56%
7%2%
8%
10% 3%
INDIA POWER INSTALLED CAPACITY (MW) IN OCT. 2019
Hydro * Coal + Lignite Gas NuclearSolar Wind Biomass
9%
32%
3%2%
36%
17%1%
INDIA POWER INSTALLED CAPACITY (MW) IN 2030 **
Hydro * Coal + Lignite Gas NuclearSolar Wind Biomass
364 GW 831 GW
* including small hydro
* including small hydro of 5000 MW and hydro imports of 4356 MW
** As per CEA-DRAFT REPORT ON OPTIMAL GENERATION CAPACITY MIX -2029-30, FEB 2019
RES (Hydro+ Solar+ Wind)= 118 GW(32%) RES (Solar+ Wind)=68 GW (18%) RES (Hydro+ Solar+ Wind)= 513 GW (62%) RES (Solar+ Wind)=440 GW (53%)
26
Expansion in Cross Border Power Trade (MW) & Future Transmission Capacity- 2036/2040
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
South
WestSouth Asia
Current Power Installed
Capacity 432 GW
North
East
North East
Bangladesh
Bhutan
All Fig are in MW
Nepal
Sri Lanka
Complied from CEA-Perspective Transmission Master Plan, Bangladesh- PSMP-2016, Other Sources 1Bangladesh-India Bheramara –Baharampur-Existing 500 MW
2 From Nepal 1,000 by 2030 Power import by using Case 3 T/L (upgrade to 765kV AC)and From Nepal (Purnea -Barapukuria), 1,000 by 2025, Power import by using Case 3 T/L(initially 400kV AC) 3 Bhutan-Bangladesh via-_India 1000 MW-Bongaigaon/Rangia -Jamarpur1,000 by 2030-Power import from Bhutan4 400 MW by 2020 ( 100 MW existing) Construction of HVDC (500MW) in Comilla Construction of HVDC (500MW) in Comilla S/S. Some load (100 MW) in Comolia (N) S/S will bedisconnected from Indian System 5 1000 MW by2023 and 1000 MW by 2025 ( Power Import Using Case 2 T/L (± 800KV HVDC) 6 1000 MW by 2030 Bibiyana-Meghalaya (PSPP)
Additional 43.8 GW Cross Border Grid Interconnection by 2036
by 2036 MW
1 Nepal-India 15800
2 Bhutan-India 17100
3 India-Sri Lanka 1000
4India-Bangladesh 4900
5
Nepal to Bangladesh via India 2000
6
Bhutan to Bangladesh via India 1000
7 India-Pakistan 1000
8Afghanistan-Pakistan 1000
9 Total 43800
10 By 2036 MW
11India -Myanmar 1500
12Bangladesh -Myanmar 500
Total MW 45800
Source: CEA-Perspective Transmission Master Plan,
Bangladesh- PSMP-2016, Other Sources
Rapid Expansion is envisaged.
43.8 GW of cross border Grid Interconnection by 2036.
7 At the Proposal Stage , detailed planning to be done.
27
South Asia Energy/Power Sector: Investment
Requirements
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
28
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
India : National Infrastructure Pipeline, Released on Dec,2019
India to Invest 1.4 Trillion USD (FY20-25)
29
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
India : National Infrastructure Pipeline : Energy Sector Vision 2025
24x7 clean &low cost power (households,
industry, commercial businesses, agriculture)
Per-Capita electricity
consumption 1,616 kWh
Total capacity: 619 GW
Thermal: 50%, renewable: 39%,
hydro: 9%, nuclear: 2%
Renewable energy’s share in consumption to
increase to ~19%
Low AT&C losses through
increased PPP in Discoms - open
access in distribution, regular tariff
revisions, extensive metering
Smart metering to be
implemented for all categories of
customers All related services
on digital platform
351
281
196
14 21
233
110 111
46
9
51 44
0
50
100
150
200
250
300
350
400 India -National Infrastructure Pipeline FY20-25 in Billion USD (1 USD=70 INR)
4
2221
24
31 31
0
5
10
15
20
25
30
35
FY20 FY21 FY22 FY23 FY24 FY25
India -National infrastructure Pipeline -Energy Sector in Billion USD (1 USD=70 INR)
Power Renewable energy Atomic energy Petroleum and natural gas
Renewable energy share in consumption stands at ~9% , High AT&C losses of discoms currently at 8-41% (except J&K), Smart metering: <5% of meters installed as on June 30, 2018 Source: http://164.100.117.97/WriteReadData/userfiles/DEA%20IPF%20NIP%20Report%20Vol%201.pdf
30
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
South Asian Power Sector- Investment Requirement (2015‐2040 Period)
Investment Requirement for the 2015‐2040 Period (Billion
US$)Projected to require 1,390 billionUS$ for expanding electricitygeneration (to add 750 GW ofgeneration capacity).
Already committed and plannedinter‐grid connection, especiallywithin India would requirearound 29 billion US$.
Source : https://openknowledge.worldbank.org/handle/10986/22224
Country Investment (Generation)
Investment (Interconnectio
n)
Afghanistan 16.36 0.18Bangladesh 105.12 0.63
Bhutan 32.08 0.54India 929.67 27.93Nepal 10.75 0.00
Pakistan 276.96 0.00Sri Lanka 18.67 0.00
Total 1,390 29Source: Projection as per the World Bank Report on “How Much Could South Asia Benefit from Regional Electricity Cooperation and Trade? “
31
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
De-carbonising Power Generation
Cleaner and Efficient Public Transport
Renewable Energy Electric Vehicle & Charging Infrastructure
Natural gas, LNG and Region Gas Grid
Modernising power grid , smart grid, smart utility
Cross Border Hydro Power Projects and Cross Border Power Transmission
South Asia: Future Energy Investment Opportunities
32
Regional Investment Framework and Guidelines for promoting investment in South Asian Power Sector & in Cross
Border Electricity Trade Projects in South Asian Region
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
33
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Regional Guidelines for investment framework
+ Liberal FDI Policies in all South Asian countries
+ Well defined PPP framework for infrastructure in most SA countries like Bangladesh, India and Pakistan
+ Independent electricity regulators in all SA, except Maldives
- Time consuming process for dispute settlement and judicial processes
- Legal and dispute resolution mechanism is not very strong in most countries
- Issues, processes for land acquisition, environmental clearances and rehabilitation, leading to project delays
- Financial Viability of Infrastructure
- Lack of Deep energy markets
Op
po
rtu
nit
ies
Ch
allen
ges
34
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
South Asia : Ease of Doing Business
South Asia : India Ranks 63 (Highest),Afghanistan 173 (Lowest)India, Bhutan (89), Nepal (94) & Sri Lanka (99) are below 100 I Pakistan (108), Maldives(147), Bangladesh (168)
Note/Source -The ease of doing business ranking ranges from 1 to 190. Values are Regional Average Rank- https://www.doingbusiness.org/en/rankings
South Asia & Arab : Ranks (Regional Average) 7th among regions (10) of World
30
39
54
96
107
116
118
118
140
154
0 50 100 150 200
OECD High Income
European Union (EU)
Europe and Central Asia
East Asia and the Pacific
Middle East and North Africa
Latin America and Caribbean
Arab World
South Asia
Sub-Saharan Africa
Organization for the…
Ranks of Subregions : Ease of doing business rank (DB20)
Best Rank Poor Rank
Note/Source -Values are Regional Average Rank- https://www.doingbusiness.org/en/reports/regional-reports
118
98
62.6
142
97
132
109
145
104
0 50 100 150 200
Ease of doing business rank (DB20)
Dealing with construction permits
Getting electricity
Registering property
Getting credit
Paying taxes
Trading across borders
Enforcing contracts
Resolving insolvency
South Asia-Ease of Doing Business Ranking -2020
35
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Regional Guidelines for investment framework
Regional institutional coordination mechanism
Tariff rationalization for the
hydropower projects
Guarantees against Political and country risks
Access to innovative and
cheaper sources of funding
Policy and Regulatory harmonization
Develop region specific
financing instruments
Streamline project approval and clearance process
Support private participation
through innovative models
Standardize contractual
framework
Regional dispute resolution
and settlement mechanism
Regional Investment Framework
1
2
3
4
5
6
7
8
9
10
36
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Points for Discussions
Focusing on De-risking the Regional Energy Infrastructure Projects : Instruments and modalities.
Strategy for Financing Cross Border Transmission Infrastructure: Business/Financing Models ?
What are the innovative market instruments/ financing mechanisms for financing future energy system ?
Role of Government for fast tracking development ?
Concerns of Lender, private power project developers ?
Role of Private sector, Public private partnerships, Joint Ventures etc. ?
Modernising power grid and decarbonising power sector.
Need of South Asia Regional Investment Facilitation Forum ?
How to accelerate the development of hydro power and mobilisation of investment?
37
Thank You
Regional Investment Framework and Policy Guidelines for promoting investment in South Asian Power Sector and in Cross-Border Electricity Trade in South Asia/Rajiv Panda/SARI/EI/IRADE –Confidential-©2017 Confidential©2017
Contact
[email protected]@gmail.com+91-9650598697
Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
38
Confidential©2017Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Investment Guidelines
1
2
3
4
Guarantees against Political and country risks
Streamline project approval and clearance process
Policy and Regulatory harmonization
• Member countries to have guidelines for mitigating political risks such as nationalization, expropriation etc. for domestic and CBET power projects
• Regional guidelines for leveraging available Instruments for political risks like MIGA
• Prepare inventory of processes to be followed in member countries for CBET project approvals, etc• Member countries’ government to provide single window clearance for necessary approvals and
licenses• Issues related to land, environment and R&R to be dealt with on priority basis
• Establish a Regional Regulatory body, Regional Electricity Regulatory Association to promote regional regulatory cooperation. This body will merely be an association of national regulatory institutions with no powers to intervene in regulatory matters in the region
• Develop guidelines for CBET projects for resolving disputes• Evolve regional consensus on conflict management and dispute resolution framework amongst
member countries - Dispute resolution procedures, alternate Dispute resolution practices, arbitration in neutral third-country, Inter - Government’s agreements
Regional dispute
resolution and
settlement
mechanism
39
Confidential©2017Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Investment Guidelines
Tariff rationalization
for the hydropower
projects
• Propose regulatory interventions for rationalization of tariffs for the hydropower projects to make them competitive in cross border transactions
• Long tenure loans with flexibility in repayments needs to be developed for the region
8
• Attract concessional financing, low cost financing from MFIs, etc.• Develop coordination mechanism for the domestic capital markets in the South Asian countries to
promote liquidity and easy access to equity by private players • Increased role of multi-lateral funding agencies in CBET projects
Access to innovative
and cheaper sources
of funding
Develop region
specific financing
instruments
• Allows broad mass of institutional investors to gain access to green growth projects • Establish a South Asian Regional Market Fund to offers long and medium term loans with fixed or
variable rates to projects in the region• Green Bonds to raise capital specifically for climate change and green growth related projects.
Allow such bonds to be issued as structured notes mechanisms or other underlying derivatives
5Standardize
contractual
framework for CBET
• Standardized contractual documents (PPAs, TSAs, etc) based on commonly agreed regulatory guidelines for the region
• Evolve consensus on providing appropriate payment security mechanisms for cross border projects• Member countries to have guidelines for foreign currency denominated PPAs to protect against
currency risks, allow back to back currency swaps etc
6
7
40
Confidential©2017Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
10
Regional institutional coordination mechanism
9
Support private
participation through
innovative models
• Establish a clear, predictable and legitimate institutional framework supported by competent and well-resourced authorities
• Use the budgetary process transparently to minimize fiscal risks and ensure the integrity of the procurement process
• Ground the selection of Public-Private Partnerships in Value for Money
• Setting up of coordinating mechanism for the investment promotion in the region under existing SA institutions
• Develop and Implement guidelines for investments, project identification and prioritization, coordinating investments in CBET
Investment Guidelines
41
Confidential©2017Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Project Risk assessment matrix
• Financial Condition
• Payment security mechanism
• Credit Rating
• Licenses and clearances
• Land acquisition
• Financial closure
• Currency fluctuation
• Political risk –expropriation, war
• Change in Law, taxation
• Currency devaluation, inconvertibility, or restrictions
• Breach of contract
• Transparency in policies of award, incentives & benefits
• Independent regulatory framework
• Conflict management
Policy and Regulatory
Risk
Political Risk
Utility/ Off-taker
Risk
Developer’s Risk
Allocation of risk and return
42
Confidential©2017Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Evaluation framework to mobilize investments
Foreign Direct Investment (FDI)
framework
Investment models for CBET
Taxation Policies and Incentives
Domestic Capital Markets
Financing Instruments
Institutional Framework
Policy and regulatory
frameworks
Legal and Dispute
resolution
Project Development
Support - Land, Environment,
R&R
Risk Evaluation Matrix
1
4
7
2
5
8
3
6
9
Policy and Regulatory
RiskPolitical Risk
Utility/ Off-taker Risk
Developer’s Risk
Investment Promotion
Investment Protection
Investment Facilitation
43
Confidential©2017Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Regional investment framework for CBET is still evolving
Foreign Direct Investment (FDI) framework
Investment models for CBET Taxation Policies and Incentives
Policy and regulatory frameworks Legal and Dispute resolutionProject Development Support -
Land, Environment, R&R
Investment Promotion
Investment Protection
Investment Facilitation
• FDI Policies are quite liberal across all countries
• Lacks regional framework for CBET
• PPP framework implemented in India, Bangladesh, Bhutan
• Regional investment model yet to evolve for cross border projects
• Regional initiatives under SAARC framework
• Domestic policies still to be harmonized
• Domestic regulatory frameworks at various levels of evolution (Nepal-Min, India-Max)
• Lacks harmonization at regional level
• Bilateral mechanism and contractual arrangements relied upon
• Lacks regional forum for resolving disputes
• Most project implementation delays caused due to local issues
• Regulatory frameworks are not very strong in many countries
Domestic Capital Markets Financing Instruments Institutional Framework
• Domestic capital markets in most countries except India lack depth for large investments
• ECB comes with stringent conditions
• Low cost financing instruments (Green bonds) have not been utilized
• Lacking in innovative debt instruments for cross border hydro projects
• Lack of harmonization of technical and commercial frameworks increases risk
• Power trading framework still to be institutionalized in most SAC
4444
183186
178 177176
189
53
1530 29
168
2722 25
52
144
0
20
40
60
80
100
120
140
160
180
200
Dealing withconstruction permits
Getting electricity Registering property Getting credit Paying taxes Trading across borders Enforcing contracts Resolving insolvency
Chart Title
Afghanistan Bangladesh Bhutan India Maldives Nepal Pakistan Sri Lanka
Confidential©2020Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
Note/Source -The ease of doing business ranking ranges from 1 to 190. Values are Regional Average Rank- https://www.doingbusiness.org/en/rankings
South Asia : Country wise ranks varies among countries
Best R
an
k
Po
or
Ra
nk
Best Rank Poor Rank
South Asia : Ease of Doing Business Ranking 2020 (1-190 )
45
Regional Investment Framework for Mobilizing Investment in Energy Infrastructure projects in South Asia “: by Rajiv Ratna Panda, Technical-Head /SARI/EI/IRADE::Conference on “Regional Energy Integration and Cross Border Energy Trade: A New Renaissance for Growth and Development of South Asia Region”19thFebruary 2020, Hotel Imperial, New Delhi, India
• Key Issues and Mitigations
Project Risk Mitigation
Political and country Policy and Regulatory Project Development Off-taker
• Political insurances
• International investment agreements (BIT, FTA)
• BOO, and BOOT business models under PPP
• Guarantee against expropriation
• Standardize contract documents
• Alternative dispute resolution mechanisms
• Regional institution
• Capacity building
• Standard technology specific project development guidelines
• Single window clearance
• Regional skill development center
• Currency hedging (Currency swaps, options, forward contract)
• USD denominated PPA
• Stable tax regime
• Corporate governance
Issues
Mitig
ation
• Political instability• High transaction cost• Transparency &
predictability• Non-discrimination• Change of law• Public governance
• Contract enforcement • Alternate dispute
settlement• Administrative process• Legal stability and
predictability
• Site identification and resource assessment
• Land acquisition, environment, R&R
• Off-taker risk• Skilled manpower
• Currency risk (exchange rate, convertibility)
• Tax policies• Corporate governance• Liquidity issues, debt
financing
Confidential©2020