World Bank Approves Long-Term Financing For 1,125 MW Dorjilung Hydropower Project In Bhutan, Jointly Owned By DGPC (60%) and Tata Power (40%)

The Board of Executive Directors of the World Bank has approved long-term financing for the 1,125 MW Dorjilung Hydropower Project (DHPL). DHPL is a Special Purpose Vehicle jointly owned by Bhutan’s Druk Green Power Corporation (60 percent) and Tata Power (40 percent), India’s largest private integrated power company. The project is expected to enhance clean energy cooperation between India and Bhutan while strengthening regional energy security.

Dorjilung will be Bhutan’s largest hydropower project developed under a public-private partnership (PPP) model. It is projected to generate over 4,500 GWh of clean electricity annually, increasing Bhutan’s installed energy capacity by nearly 40 percent and reinforcing the country’s position as a reliable exporter of clean energy to India. Approximately 80 percent of the electricity generated from the project will be supplied to India, with Tata Power Trading Company Limited, a wholly owned subsidiary of Tata Power, responsible for importing and managing its distribution.

The World Bank financing package comprises a $150 million grant and a $150 million credit from the International Development Association (IDA), a $15 million enclave loan from the International Bank for Reconstruction and Development (IBRD) to the Government of Bhutan’s DGPC, a $200 million IBRD enclave loan, and a $300 million loan from the International Finance Corporation (IFC) to DHPL. The remaining project funding will be arranged through participation from various market players. The approval by the World Bank underscores confidence in the project’s technical and financial foundations.

It provides long-term stability, enabling Tata Power and DGPC to advance the project in a measured and disciplined manner while delivering sustainable value for all stakeholders. The Dorjilung project highlights the long-standing energy partnership between Bhutan and India and demonstrates how regional collaboration can yield shared economic and environmental benefits. The project is expected to generate significant employment during both construction and operations, support local entrepreneurship, and enhance livelihoods in the Mongar and Lhuentse districts of Bhutan.

Dorjilung represents the next chapter in this enduring partnership focused on sustainable development. It exemplifies how collaboration among governments, multilateral institutions, and the private sector can turn policy ambitions into bankable, high-impact outcomes that strengthen South Asia’s clean energy landscape.