Zambia, which needs to increase its power generation capacity, has secured a USD 50 million from India to develop the 120 MW Ithezi Thezi hydro power project. It is part of an initiative led by the Indian government under what is known as the Africa India partnership forum.

The loan has been secured through TATA Africa Holdings which wants to partner Zambia’s electricity utility ZESCO in the construction of the project. national demand has increased in recent years, chiefly from the country’s mining activities.

The financing is for the rehabilitation of the hydro plant through a 50:50% JV funding between Zambia’s Electricity Supply Corporation and TATA Africa. It is part of the USD 240 million needed to upgrade Ithezi Thezi power plant.

The increasing mining sector is estimated to consume about 50% of Zambia’s generated power. Under the agreement, Zambia’s state power utility and TATA Africa are expected to ensure the plant is rehabilitated and commissioned before the end of 2011.