Himachal govt to get 18 percent royalty from Karcham-Wangtoo project

The Himachal Pradesh government has achieved a major victory in the Supreme Court, securing a landmark judgment in its favour in the long-standing royalty dispute over the Karcham-Wangtoo Hydroelectric Project.

The apex court has ruled that JSW Energy must now pay 18 percent royalty to the state, up from the 12 percent it had been paying, for the 1045 MW project, a government spokesperson said here on Wednesday.

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He said that this verdict is expected to boost the state’s annual income by approximately Rs 150 crore.

Furthermore, the judgment is likely to set a precedent for other hydroelectric projects that have completed 12 years of operation, potentially adding over Rs 250 crore per year to the state exchequer, he added.

Chief Minister Thakur Sukhvinder Singh Sukhu played a pivotal role in pushing this issue, personally prioritising the matter and ensuring that the state’s rights over its natural resources were strongly defended, he claimed.

The government has hailed the verdict as a victory not just for the state treasury, but for the people of Himachal Pradesh, who will now benefit more directly from their own resources, the spokesperson said.

The Supreme Court’s ruling effectively overturns a May 2024 decision by the Himachal Pradesh High Court, which had allowed the company to continue paying only 12 percent royalty, he said, adding that as per the 1999 agreement between the state government and the company, the royalty was fixed at 12 percent for the first 12 years of operations, and 18 percent thereafter for the next 28 years.

While the project began operations in September 2011, JSW Energy paid the agreed 12 percent royalty for the initial term, but from September 2023, it refused to comply with the increased rate, he stated.

The dispute reached the High Court, and the decision was given in favour of the company. However, the state government subsequently challenged the verdict in the Supreme Court.