The Union Cabinet on Wednesday approved investments of ₹40,150 crore for two hydropower projects in Arunachal Pradesh and revised the cost of the HPCL Rajasthan Refinery project to ₹79,459 crore, according to an official statement.
The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, approved ₹26,069.50 crore for the 1,720 MW Kamala Hydro Electric Project and ₹14,105.83 crore for the 1,200 MW Kalai-II Hydro Electric Project.
“The Cabinet Committee on Economic Affairs… has approved investment of ₹26,069.50 crore for construction of Kamala Hydro Electric Project (HEP)… The estimated completion period for the project is 96 months,” the statement said.
The Kamala project will be developed in Kamle, Kra Daadi and Kurung Kumey districts through a joint venture between NHPC Ltd and the Arunachal Pradesh government. It is expected to generate about 6,870 million units annually.
The Kalai-II project will be built on the Lohit river in Anjaw district through a joint venture between THDC India Ltd and the state government. “The CCEA approved investment of ₹14,105.83 crore for construction of Kalai-II Hydro Electric Project (HEP)… The estimated completion period for the project is 78 months,” the statement said. It is expected to generate around 4,853 million units annually.
Both projects provide 12 per cent free power to host states and 1 per cent allocation for Local Area Development Funds. The Centre will provide support for infrastructure including roads, bridges and transmission systems.
Powering the Northeast
“There will be significant improvement in the infrastructure in Kamle, Kra Daadi & Kurung Kumey Districts… including the development of around 196 kms of roads and bridges,” the statement said. It added that similar infrastructure including “around 29 kilometres of roads and bridges” will be developed in Anjaw district.
The statement said project funds will support construction of hospitals, schools and marketplaces, and local population will benefit through compensation, employment and CSR activities.
Other hydropower projects under development in the region include Subansiri Lower (2,000 MW), Dibang Multipurpose (2,880 MW) and Etalin (3,097 MW).
Separately, the CCEA approved revision in the cost of HPCL Rajasthan Refinery Ltd (HRRL) to ₹79,459 crore from ₹43,129 crore.
“The Cabinet Committee on Economic Affairs… has approved the revision of HRRL project cost,” the statement said.
HPCL will invest an additional ₹8,962 crore, taking its total equity contribution to about ₹19,600 crore. The refinery-cum-petrochemical complex in Balotra has a capacity of 9 million tonnes per annum.
Boosting Energy Autonomy
The project is scheduled for inauguration on April 21 and is expected to begin commercial operations from July 1, 2026.
The refinery will produce petrol, diesel and petrochemicals including polypropylene, polyethylene variants, benzene and butadiene. These products are used in sectors including transport, packaging, pharmaceuticals and construction.
The project will process domestic crude including supplies from the Mangala fields in Rajasthan. It is expected to reduce import dependence on petrochemicals.
The statement said the cost revision reflects higher input costs and addition of petrochemical units.