The agreement was signed here yesterday by the State Power Development Corporation managing director J A Shahmeri and chairman of Jaiprakash Industries Ltd, Jaiprakash Gaur, in the presence of chief minister Farooq Abdullah.

Abdullah said tapping of the potential and commencement of other projects, like URI-II, Kishenganga, Sewa-II and Sawalkote, would place the state in a position to meet the requirements of the power-starved northern region. Expected to be completed in five years, the pre-commencement work of the Rs 3495 crore project would start from next month, the spokesman said. The project will have an installed capacity of 450 mw.