"As there are grievances from federal, provincial and local level representatives that the compensation fixation has not been fair, the stakeholders will move ahead by incorporating the provisions of revision of compensation fixation," said the Energy Ministry.

This has come a week after the Budhi Gandaki Environment, Compensation Distribution, Resettlement and Rehabilitation Unit announced compensation rates ranging from Rs50,000-Rs700,000 per aana, leading to a complete shutdown of Arughat market, a project affected area in Gorkha district.

Following the Unit’s decision, irate project-affected locals who have been demanding compensation of Rs2.5 million per aana took to the streets, burnt tyres and shut down local markets expressing discontent over the proposed rates.

The committee had decided to payout Rs50000-Rs700,000 per anna depending upon the location and condition of the 17,770 ropanies of land which the government froze for acquisition four years ago but is yet to distribute the compensation amount.

Apart from revising the compensation, the Energy Ministry has also decided to devise a work plan on resettlement and rehabilitation of settlements facing inundation and forward it to the Cabinet to ensure immediate implementation of the much-hyped reservoir project.

“In matters related to discounting depreciation and gains tax to property owners in the affected region, the Ministry of Energy, Water Resources and Irrigation will table a proposal in the Cabinet within two weeks,” the decision paper reads.

Denizens of Arughat and Arkhet in Gorkha and Khahare in Dhading have organised multiple protest programmes over the year, demanding quick settlement of the issues on rehabilitation and fair value for their land.

The government has allocated around Rs 15 billion in the current fiscal’s budget for compensation payouts. So far, it has spent around Rs20 billion to acquire land in 27 settlements in Gorkha and Dhading districts.

According to the Unit, payments totalling Rs26.84 billion have been issued to acquire 44,658 ropanis of land till date.

Budhi Gandaki is one of the most talked-about projects, and the first feasibility study was conducted in 1984 as it was viewed as a mutual benefit project with India.

The project never came out of the drawing board until the second feasibility study was completed in 2014.

The government has estimated that around Rs60 billion will be required to complete land acquisition in the project-affected areas, and the Energy Ministry has targeted completing the property acquisition process within the current fiscal year.

The government has collected Rs37 billion from the public through Nepal Oil Corporation as an infrastructure tax to pay land compensation. It has accorded top priority to the project's development, but it remains undecided over the development modality.

In September last year, the cabinet had directed the Energy Ministry to initiate the process to prepare a proposal, hold talks and strike a deal with Chinese contractor Gezhouba Group Corporation for the execution of the national pride project. But the plan fell apart.

The project landed in controversy after the then Pushpa Kamal Dahal led-government awarded the contract to the Chinese firm under an engineering, procurement, construction and financing model without competitive bidding.

In November 2017, the decision to award the contract to the Chinese firm was reversed by the subsequent Deuba-led government citing procedural flaws.

The Finance Ministry has also advised the Energy Ministry to go for competitive bidding by reducing the cost of the project.