Kathmandu. The Independent Power Producers’ Association, Nepal (IPPAN) has urged hydropower companies to offer their shares to the locals at face value and not at the premium price.

The IPPAN has drawn serious attention to the fact that some of the promoter companies are discussing the option of issuing shares at a premium price to the affected locals after the IPO process of some hydropower projects was affected for a long time due to regulatory reasons.

In this regard, it is of the view that the shares to be provided to the locals directly affected by the IPPAN hydropower project should be made available at face value i.e. Rs 100 per unit. IPPAN has requested all its members to comply with the provisions of Rule 9 (4) of the Securities Registration and Issue Regulations, 2073 BS for providing 10 percent shares for the benefit of the locals.

According to IPPAN, the hydropower project is not only a means of investment but also a development campaign based on trust, collaboration and partnership with the local communities.

It reminded that the share allocation was made with the objective of providing land in course of the construction of the project, bearing environmental and social impacts, inconveniences during the construction period and involving the local community who would directly assist in the successful implementation of the project.

IPPAN Chairman Mohan Kumar Dangi said that if the shares are issued at a premium price, the access of the local community will be limited, their sense of ownership will be weakened and the trust built between the project and the community will be negatively affected.

According to IPPAN, the distribution of the shares to the locals at face value will help them become real partners of the projects, increase the sense of ownership and ownership towards the projects, reduce social disputes and obstacles seen in the construction and operation of the projects, strengthen cooperation and cooperation at the local level and create an environment conducive for the timely completion of hydropower projects.

It will also ensure an opportunity for local communities to reap long-term benefits from the project. It is said that it will also support economic empowerment, local development and social harmony.

IPPAN has urged the government, regulatory agencies and all promoter companies to continue with the policy of allotting shares at face value to the locals, keeping the interest of the affected locals, long-term sustainability of hydropower projects and good relations between the private sector and the local community.

The meeting also drew the attention of the bodies concerned to further strengthen the investment climate in the hydropower sector by making the regulatory process related to the issue of ordinary shares simple, transparent and time-bound.