Today, challenges like climate change, pandemics, energy shortages, economic crises, and many more are besetting us. No nation can overcome these obstacles without the assistance and collaboration of other nations. Most importantly, many of these problems have international repercussions. South Asia is struggling with these challenges much more as compared to other regions, but its regional organisations like SAARC are ineffective in dealing with these crises. 

The time has come to revive sub-regional organizations such as the Bangladesh, Bhutan, India, and Nepal (BBIN), which has gathered some momentum in recent years.  All four nations of this sub-region are facing an energy crisis due to the Russia-Ukraine war. There cannot be a better way than sub-regional energy trade involving Nepal, India, Bangladesh, and Bhutan, which would be a win-win for all countries concerned. 

BBIN sub-regional energy integration

The rapid growth of electricity demand in developing nations and the emergence of digital technologies has created increased opportunities for international electricity trade. BBIN sub-regional energy integration, by having new transmission lines, can facilitate energy trade among these countries. Following this, India-Bangladesh-Nepal could consider trilateral trade of electricity where Nepal could export its surplus electricity to Bangladesh to meet its deficit in electricity via Indian territory.

In early 2022, Dhaka proposed power trade between Nepal and Bangladesh in a way that suits the interest of both countries. No doubt that the proposal made perfect sense. The remarks by Bangladesh come at a time when India, which lies between the two countries, has expressed its eagerness to promote sub-regional cooperation on energy with Nepal, Bangladesh, and Bhutan. The proposal indicates a good example of regional energy cooperation between Bangladesh and Nepal in partnership with India where the latter's transmission system needs to be used.

In August 2022, Nepal and Bangladesh have jointly requested India to use its land for inter-country electricity transportation using the Indian infrastructure. Initially, 50 megawatts of electricity will be transported via India. Officials and experts say if India gives access to its transmission infrastructure, bilateral power trade between Nepal and Bangladesh is compatible with the needs of both countries. However, the proposal needs further scrutiny to better understand the nature of energy cooperation between Bangladesh and Nepal and the level of partnership with India in this regard.

Seasonal demand influences energy trade

Bangladesh's connectivity with the regional countries, especially with Nepal, Bhutan, and India is developing. Prospects of energy trade among these countries are also growing. Any energy generated by Nepal that is not consumed there can be consumed by Bangladesh or others.

The seasonal demand for electrical energy among countries in the BBIN region influences the amount of energy that can be traded. Because the electricity trade will predominantly involve the export of hydroelectric energy, the seasonal demand for electricity in Bhutan and Nepal plays a critical role in determining the feasibility of trade. 

In the monsoon season, there is ample energy available from hydroelectric resources in Bhutan and Nepal which can be sold to India and Bangladesh. This seasonal variation in the need for electricity in Bangladesh offers an opportunity for Bhutan and Nepal, where electricity generation peaks during the monsoon season, because of water availability.

The fact is that in Bangladesh the demand during the daytime in summer is high due to cooling needs. These demand patterns throughout the day suggest opportunities for Nepal to flatten the pattern of energy production throughout the day relative to the pattern of their internal demand by selling electricity to Bangladesh, particularly during the summer months when the demand in Nepal is low and the demand in Bangladesh is high. Importing this surplus electricity would boost Nepal's economic fortunes as well as Bangladesh’s summer demand.

India's key role in quadrilateral energy interdependency

India is considering Nepalese and Bangladesh proposals to allow Kathmandu to sell electricity to Dhaka via Indian territory and Indian infrastructure which would deepen sub-regional cooperation in a big way. Officials say a meeting between Nepali and Indian officials led by energy secretaries of the countries will finalize the matter. The meeting is scheduled to be held in the third week of February in New Delhi.

India offers the opportunity to interconnect the Bangladesh, Bhutan, and Nepal electricity supply industries. The possibility of using Indian power infrastructure for electricity trade between Nepal and Bangladesh is another facet of India's neighborhood engagement. These bonds of support, trade and economic opportunities should bind the countries, with India as a critical player. Acting in unison would be in the enlightened self-interest of each country in South Asia. This approach makes India a reliable partner. The power trade between Nepal and Bangladesh also reflects the active role of a silent organization like BBIN. Nepal will gain from the sale, and Bangladesh will benefit from access to electricity.

Besides opening the opportunity for bilateral trade between Nepal and Bangladesh, a new opportunity for sub-regional energy trade among BBIN countries is also emerging, with India itself pushing for it. For this, transmission line connectivity alone will not be enough. There is a need for harmonized rules and regulations among the participating countries and there should be a multilateral agreement on details including the wheeling charge of electricity among the participating countries. It is hoped that Nepal and Bangladesh will widen collaboration in the power sector and include partner nations in the energy interdependency in South Asia.

(The author is an independent researcher and freelance columnist based in Dhaka, Bangladesh. Views are personal).