To cure Kathmandu Valley´s self-induced drought, planners have often looked to fresh-water sources beyond the Valley rim. A "pre-feasibiliry study" of out-of-Valley water projects was completed by Binnie and Partners, a British consultancy firm, in 1988. The study recommended the Melamchi Khola of Helambu, north-east of Kathmandu, as the best source from among 20 possible alternatives. In 1989, the recommended project options were ranked in terms of their environmental impact The Melamchi scheme was considered to have the least impact among the selected alternatives.
The proposal is to divert the flow of the Melamchi to the Valley through a 27 km long tunnel of 2.5 m diameter. Upon entering the Valley, Melamchi water would fall into a 5 mi Hi on cubic meter-capacity storage reservoir at Sundarijal. A later "Modified Melamchi" proposal would enlarge the reservoir at Sundarija] to store the Bagmati´s flow as well.
The search is on for financing the project Confesses an editorial in the newsletter brought out by the Nepal Water Supply Corporation, "We at NWSC are still on the lookout for donors with 400 million dollars for this very ambitious, sure-to-co me-one-day mega-project!"
According to preliminary estimates, the Project would cost about NRs 10,000 per resident of Greater Kathmandu (Kathmandu and Paten), The calculation is projected to 2021 AD, when the project is expected to be completed, if implemented, and when the targeted urban population of the Valley will be a little over 1.6 million. Most other water projects in Nepal have far lower investment costs—in the inaccessible villages of the far west hills, the average investment cost is about NRs 1,600 per capita at the 1990 price level. The national average for "mechanised urban water supply systems" is a about NRs 4,500.