Nepal Disaster and Hydropower: How Global Banks Downplayed the Risks they Knew – SANDRP

On the twenty eighth August 2026, Nepali officers roughly doubled their tally of lacking folks to over 1,900, saying hydropower producers had solely not too long ago shared a depend of unaccounted-for employees at tasks within the devastated river valleys. It is feared that over 900 people are missing from hydropower projects.

This may be a watershed second for the disaster-torn hydropower increase in South Asia, funded many occasions by Worldwide Monetary Firms and Multilateral Banks like ADB and World Financial institution, and likewise Chinese language Exim financial institution.

A whole lot of hydropower labourers, engineers and locals are at the moment trapped inside tunnels of tasks like Higher Trishuli 1 and Trishuli 3A, the latter funded by a mortgage from China’s Exim bank within the flood ravaged Nepal. More than 350 have been rescued by the valiant efforts of Nepal Military, however many extra are nonetheless trapped contained in the tunnel, together with Indians.

214 MW Higher Trishuli I is considered one of Nepal’s largest hydropower mission, near-complete, which now lies all but destroyed by the sheer power and fury of the Himalayan floods. The whole Trishuli Basin has dense hydropower growth with greater than 36 hydropower tasks.

As rescue work progresses and disturbing photographs come up, to some this may increasingly not appear to the time to boost the difficulty of Hydropower in Himalayas. However it’s. As a result of as we are going to see, reviews and reminders concerning the repeating floods in Trishuli River, like different Himalayan rivers, made no distinction to the builders, builders, or the funders. Local weather disasters related to infrastructure throughout Himalayas have been inflicting deaths and destruction with a despairing regularity. They’re repeatedly placing hundreds of labourers, native residents and vacationers in mortal hazard, with little or no recourse and accountability.

Multilateral Growth Banks together with the ADB and World Financial institution Group’s IFC, that financed and championed the Higher Trishuli-1 hydropower mission and carried out a Cumulative Influence Evaluation of Trishuli Basin had been aware of the acute hazard to which they had been exposing hundreds of laborers, officers, residents, rivers, infrastructure and panorama. Their very own reviews repeatedly highlighted it. However they didn’t take any preventive steps, didn’t demand stringent checks and balances, nor had been they ready for a calamity they knew might happen. Funding was sought and offered within the garb of “Local weather and Catastrophe Resilience”. Upstream impacts from Tibet weren’t studied, funding didn’t cease.

1000’s of labourers, engineers and contractors had been thus concentrated in a unstable valley which suffered had severe floods in 2024 and GLOF floods in 2025, other than the present deluge.

Worldwide Finance and Trishuli/ Bhote Koshi Catastrophe

The $647.4 million Higher Trishuli-1 (UT-1) hydropower mission the place a whole bunch are trapped, is without doubt one of the largest overseas direct investments in Nepal’s historical past, a characterization Worldwide Finance Company’s (IFC) own press release makes use of when describing the mission.

It is bankrolled and owned by a consortium of the world’s most powerful financial institutions. The IFC (the non-public sector arm of the World Financial institution) led the trouble to rearrange the mission’s $453 million debt bundle and it owns a 15% fairness stake within the mission firm, making it a co-owner. Asian Growth Financial institution (ADB) and Asian Infrastructure Funding Financial institution (AIIB) put a mixed $150 million in loans into the dam. The ADB drew half of its funds from Canadian Climate Fund particularly meant to “construct catastrophe resilience”, one thing that sounds particularly jarring in the present day. The rest of the debt bundle got here from an online of growth finance establishments spanning from the UK (CDC Group, now British Worldwide Funding) to South Korea (Korea Growth Financial institution, Export-Import Financial institution of Korea) to the Netherlands (FMO) and the OPEC Fund.

Asian Growth Financial institution: Warnings from its personal report ignored

ADB states that the Higher Trishuli 1 mission helps ADB’s methods: “tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability” [13]. Below ADB’s assist, the mission obtained a mortgage from the Canadian Local weather Fund for the Personal Sector in Asia II (CFPS II) for USD 30 million.

The ADB acknowledges: “Local weather change danger evaluation beforehand concluded that the dangers of local weather change impacts on the mission are low; nevertheless, excessive rainfall in earlier years and a glacial lake outburst flood occasion in 2025 resulted in injury to some mission services whereas beneath building and vital alteration of river morphology alongside the Trishuli river”.

In truth, the Impartial Panel of Consultants (IPoE) Report in June 2025 particularly said: “IPoE had recommended the preparation of a Climate Resilience Assessment for the Project. This assessment has yet to be done. Following the September 2024 occasion, which confirmed that combos of climatic and geological occasions can have extreme penalties, we advocate increasing the scope of such local weather resilience evaluation to catastrophe dangers” [14]. No such Local weather Resilience Evaluation is current on the dashboard.

The ADB was conscious not solely of the 2025 flood on the hydropower mission, however a September 2024 flood additionally. The IPoE Report states: “The September 2024 floodwater surge near Mission headquarters threatened the steadiness of the Powerhouse labor camp placing employees in danger and requiring momentary doubling-up of employees.”

It factors out:

“The gradual implementation of a dependable early flood warning system, as mentioned within the Environmental part of this report, stays a serious danger to these mission communities in proximity to the river, particularly Mailung and Gumchet, contemplating the injury inflicted within the Powerhouse space by an remoted floodwater surge in September 2024.”

The IPoE Report for December 2024 outlines the September 2024 flood occasion that “washed away the labours camp” and mentions “The Proprietor’s Engineer estimates the return interval of the September twenty eighth flood to 4 years, whereas the EPC’s major subcontractor estimates it to 10 000 years (!)”

This was adopted by a July 2025 flood event in the same ravaged Trishuli region. This flood made 10 tasks defunct. The ADB Dashboard doesn’t embrace any reviews of this flood. There aren’t any additional updates.

Nonetheless, the funding didn’t cease. The Worldwide Businesses concerned which have the monetary wherewithal and out there experience didn’t push for In-situ and different early warning system or a Local weather Threat Evaluation Plan even after repeated floods and dangers. Being a global physique themselves, they didn’t see the necessity to push for a trans-boundary danger evaluation for this mission, so near the Tibet border.

Worldwide Finance Company (IFC):

The IFC printed a Cumulative Impact Assessment of Trishuli Basin in 2020 to satisfy its personal lending circumstances. The report got here out 7 years after the Uttarakhand disaster where thousands of Himalayan pilgrims died in a devastating flood triggered by a GLOF and sophisticated by hydropower tasks. IFC CIA had the chance and house to deal with cumulative disasters, GLOFs, transboundary impacts, Compound disasters, rising footprint of a altering local weather. It did nothing. Whereas not discussing cumulative threats of GLOFs and flood disasters, it didn’t even try to take a look at the upstream and assess Tibetan impacts. It made no cumulative catastrophe plan for a basin suffering from hydropower tasks.

On the similar time, the Impartial Panel of Skilled Studies which reported to ADB had been additionally reporting to the IFC which suggests it was conscious of the recurrent floods, GLOFs and warning about Local weather Resilience Evaluation and Early warning methods. But, nothing modified.

China’s Exim Financial institution

China’s Export Import or Exim Bank provided $149 Million concessional loan for Trishuli 3 A Hydropower mission which is severely broken and in whose tunnels a whole bunch of employees are trapped. The Contractor for the mission was Chinese language ‘China Gezhouba Group Firm’. They haven’t any impartial, binding environmental safeguards and depend on Host Nation guidelines or voluntary motion at finest! That is even supposing China and Nepal share a few of the most fragile elements of this catastrophe inclined trans-boundary Himalayan basin.

Current Hydropower Disasters in Himalayas

In August 2026, 10 labourers died in flooding accident in India’s 444 MW Vishnugad Pipalkoti Project

In July 2026, 25 labourers died in Sikkim’s Teesta VI Hydropower Mission

In August 2025, thousands of people were affected by floods made worse by a Ranjit Sagar hydropower Mission in India

In October 2023, more than 55 people died in Teesta III collapse following a GLOF which was forecasted.

In Feb 2021, more than 50 people died, many of whom were labourers in Rishiganga HEP in India

It’s with this background that communities living in Sikkim Himalayas are asking for a moratorium on hydropower projects which have led to focus of individuals and impacts within the extremely weak Himalayas.

Multilateral Growth Banks, Worldwide Local weather Funds, Worldwide Finance Firms want to understand the “Worldwide” nature of trans-boundary disasters and rising local weather dangers. It’s excessive time worldwide finance our bodies like ADB, IFC, AIIB, Chinese language Exim Financial institution and so forth., settle for their position in placing folks and ecosystems in danger. The migrant labors engaged on hydropower tasks in Himalayas are a few of the most tragically weak sections of our society.

Himalayan rivers have been witnessing tragedy after tragedy. Allow us to hope that this a watershed second the place lasting change begins.

Parineeta Dandekar, Himanshu Thakkar, SANDRP

ANNEXURE: Hydropower Initiatives on Trishuli River, Nepal