BRI in Nepal remains non-starter


China’s Belt and Road Initiative (BRI) in Nepal remains a non-starter despite recent assertion by the Himalayan state’s deputy prime minister that the two countries will “very soon” sign a plan to implement the ambitious infrastructure programme.

Nepal and China signed a memorandum of understanding on BRI in 2017. Nearly seven years since, not a single project under the initiative has either been executed or negotiated as successive governments in Nepal have been averse to borrowing loans from Beijing unlike Sri Lanka and Pakistan, according to Nepal watchers.

The issue came into the limelight once again on Saturday when Nepal’s deputy prime minister and minister for home affairs Narayan Kaji Shrestha said, without giving any specific details or dates, that Nepal and China will sign the implementation plan of the BRI “very soon”. Last year, a controversy erupted when China claimed the Pokhara airport in Nepal was part of the BRI.

“Once we sign the implementation plan, we will move into the implementation phase,” Shrestha said while addressing the Silk Road Youth Forum and South Asian Cooperation Conference in Kathmandu.

“China’s support in building critical infrastructure, such as roads, bridges and energy projects, has been instrumental in propelling Nepal towards economic growth and stability,” Shrestha said. “The connectivity fostered through these projects not only strengthens bilateral ties but also contributes to the broader vision of regional cooperation and integration.”

“China’s BRI has emerged as a transformative force in shaping the economic landscape of South Asia,” said Shrestha. “The BRI with its emphasis on connectivity, infrastructure development and economic cooperation aligns seamlessly with the development aspirations of nations in the region,” claimed the deputy PM.

However, none of the other senior Nepalese ministers have so far expressed eagerness to sign up to BRI in the backdrop of Nepal’s financial condition. Kathmandu has been keen to accept grants rather than Chinese loans, which are extended at high interest rates, a source said, adding that the signing of the BRI implementation plan between Nepal and China has been one of the prime agenda since early 2020 but an agreement has been elusive due to differences between the two sides over the investment modality.

Nepal owes far less to China than many other countries in Asia as it has always been cautious about loans and has been seeking grant assistance. Unlike China, India has offered benevolent grant assistance to Nepal since the 1950s. Nepal is one of India’s largest and most prominent development partners. The India-Nepal cooperation for developing modern infrastructure in Nepal began in 1951.

Apart from taking up infrastructure development projects, India has also shared technical know-how with Nepal in various fields including education, health, archives, archaeology, irrigation, power, horticulture, development of industries, and trade promotion etc, contributing in its socio-economic development. The India-Nepal development partnership has continued and expanded for over seven decades. The projects under development partnership have been diverse in size and sector with geographical spread throughout Nepal.


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