Weekly Business Roundup (September 19, 2008)

By WILLIAM BOOT

India to Receive All Electricity from Two Hydropower Projects

All 1,800 megawatts of electricity capacity from two new hydropower dam projects to be built on the Chindwin River in northwest Burma will go to India—despite chronic power shortages in Burma.

The Indian state-owned company NHPC said this week it was due to sign a US $3.2 billion deal with the Burmese Department of Hydropower Implementation.

The chairman of NHPC, S.K. Garg, was in Naypyidaw to finalize the deal, The Times of India reported.

The projects are described as a joint venture, but India will finance both projects—a very large 1,200-megawatt hydropower dam at Tamanthy, and a smaller, 600-megawatt capacity dam on the Chindwin River at Shwesayay.

It's not yet known how many people are likely to be displaced by the dam-related schemes, which will also affect the river's flow downstream.

"The planned generating power of these two hydro systems is greater than Myanmar's entire national electricity capacity at present," energy industries consultant Sar Watana in Bangkok told The Irrawaddy. "But of course it would in any case be of very little use to Burma without a major upgrade and expansion in the country's grid transmission infrastructure, which is very poor."

A dedicated transmission line will be built to carry the electricity from the two hydro systems to India's neighboring Manipur State, which is also suffering from a shortage of electricity.

Burma Prepares UN Submission on Bay of Bengal Territorial Claims

Burma is to have more negotiations with neighbor Bangladesh on disputed sea territory.
The talks, which are spurred by the discovery of large quantities of gas and oil in the Bay of Bengal, have added urgency because of a boundary submission deadline facing Burma.

The Burmese government is slated to submit claims to the United Nations on May 21 next year under the UN Convention on the Law of the Sea.

Burma backed Indian protests earlier this year to Bangladesh when the Dhaka government announced plans to issue exploration licenses in disputed waters.

Bangladesh is desperately short of electricity to fuel its economic development and rapidly growing population.

In 2006, Bangladesh complained to its two neighbors when they started to open up offshore areas to exploration.

Both Burma and Bangladesh have discovered large tranches of undersea gas.

On September 15, Bangladesh resumed offshore territorial talks with India for the first time in 28 years.

But India's Economic Times newspaper noted: "Bangladesh is yet to make any progress in preparing its paper with proper boundary surveys due to lack of experience, skilled manpower and equipment. The [Dhaka] government is planning to take help from the US, Britain and Australia."

The next round of talks between Burma and Bangladesh is expected in November.

US Puts Pressure on Burma Insurers

The United States says it is seeking to pressure international insurance companies still doing business with Burma to reconsider their positions in the junta-run country.

That news follows the public criticism of several major insurers working in Burma by the British human rights campaigners UK Burma Campaign.

The US was already attempting to tighten sanctions against Iran by pressuring insurance companies to pull out of the country.

The US, however, evaded a specific question on insurers and the US Burma sanctions campaign at a media conference at the United Nations, says the New York-based financial propriety campaigner Inner City Press (ICP).

Deputy Assistant Treasury Secretary Daniel Glaser said: "We and our partners have started a dialogue with the international insurance community to make sure that they are taking the steps that they need to take."

"It's going to be important for insurance companies to be as vigilant as possible, particularly on maritime insurance and re-insurance," said Glaser, according to ICP.