Indian helping hands for Zimbabwe

 The Hwange Power Station, located in Zimbabwe was under severe trouble for being inefficient and breaking down a lot. Fed from the Zambezi river, and the vast 1200MW coal reserves below it, the Hwange is the biggest power supplier for Zimbabwe. But due to its ageing equipment to last 30 years, now completing 38, the efficiency of the powerhouse has lowered by a lot.



Causes: The power station has been experiencing constant breakdowns. And due to the deterioration, Hwange Power Station has only been able to generate less than 300MW daily from the expected 920MW.

Where did India come into the picture: According to the Zimbabwe Power Company (ZPC), a power generation unit of ZESA Holdings, requires about US$450m, the Government of Zimbabwe, last year applied for a US$310m credit line from the Government of India.  These helping hands belong to The Export-Import Bank (Exim Bank) of India which has approved a US$310m loan facility for financing the extension of the lifespan of the Hwange Power Station, to ensure efficient electricity generation capacity. 

Along with this, the EXIM bank has also submitted the tender for the repowering project at Bulawayo Power Station (87 M USD). The rehabilitation of the power plant will entail the installation of new technology including CFBC boilers and auxiliaries. Exim Bank is also financing Deka pumping and water intake systems in Zimbabwe (48.1 M USD).

Why did EXIM finance Zimbabwe's projects?: The job of the EXIM bank is to promote Indian trade all over the world. In order to complete this, the Indian products now have a direct market in Zimbabwe due to this agreement.

What is in it for you: A completely new market has opened up to the Indians for trade. Service and Product providers can now customize it according to the new market to enter into a "blue ocean" instead of competition in the already crowded Indian Markets.

Support Links:

Bloomberg coverage

In-Depth - coverage

Motives of EXIM bank - This link is old, but contains why EXIM gave out so much money in the earlier days too.

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