The Asian Development Bank is considering joining a consortium of investors on the 750MW West Seti project that hopes to sell power to India. The Manila-based bank has been in consultation with the other investors, Australia's SMEC, China's CMEC and Nepali financial institutions. ADB could have a direct equity participation and guarantee the project's debt financing. Officials are in Kathmandu and will tour the site in Doti district as well as India.

"ADB's participation would help bolster confidence among investors and in India, China, and Nepal," said Himalaya Pande, the project's Nepali promoter. West Seti has negotiated a plant design contract with China's CMEC which will also have an equity share in the project. China's Export Import Bank, Industrial and Commercial Bank of China and China Development Bank could lend up to a billion dollars.

Project sources say the big hurdle now is political risk assessment and insurance. "Despite recent political changes and the ceasefire, Nepal is still viewed as very high risk for foreign investors," said Pande. The China Export and Credit Insurance Corporation (Sinosure) will likely provide $400 million of insurance, and West Seti is doing an insurance roadshow in North America in September for the rest.