A high-capacity power transmission link between India and Sri Lanka will begin construction next year and will be completed by 2013.

The 285-kilometre power link, including submarine cables over a stretch of 50 km, will enable the two countries to trade their surplus power, thereby offering a cheaper option to bridge their power generation deficit and also manage their peak demand.

The transmission link will pave the way for future trading of electricity between the two countries.

Powergrid and the Ceylon Electricity Board will lay down cables under the Gulf of Mannar between Rameshwaram in Tamil Nadu and Talaimannar in Mannar.

On the Indian side, the cable will be connected to the southern grid in Madurai through an overhead transmission line. On the Sri Lankan side, the underwater cable will be linked to the country's power network in Anuradhapura through an overhead line.

"The work on the project should begin by February-March next year after the MoU is signed. It will take us two-and-a-half to three years to complete this project," quoting S K Chaturvedi, Chairman and Managing Director of Powergrid, Indian Media reported.

The subsea line would initially have a capacity of 500 Mw, according to Powergrid's feasibility report. Later, the power flow could be ramped up to 1,000 Mw by 2016 when the power generation capacities in the two countries improve, with surplus availability especially in India's southern grid.

Powergrid had carried out a feasibility study of the project last year and had found the installing of the transmission lines to be feasible. "We have already received an approval from the Ministry of External Affairs (MEA). Now a detailed project report will be prepared," said Chaturvedi.