Article Republished : Aviation & Defence Universe
Image Courtesy: The Hindu
The 72 years old Chairman of the Communist Party of Nepal, Khadga Prasad Sharma Oli popularly known as K.P.Sharma Oli returned from China on 5th December, after a four day official visit. Oli went to China with an 87 members delegation. On conclusion of his China visit he told the media at Tribhuvan International Airport that “Nepal–China relations have further deepened after my visit. This will certainly benefit Nepal”. He also said that during his visit, agreements were signed under the Belt and Road Initiative (BRI) which will benefit Nepal. He also mentioned that separate agreements would be signed for each project. BRI is a global infrastructure development strategy of Chinese government, which started in 2013 to invest in more than 150 countries and international organisations.
Nepal and China signed the BRI agreement in 2017, and 35 projects were identified however these projects were reduced to 9 in 2019 and that too were not started. Not only this, the details of the BRI cooperation agreement were not made public. It is the common strategy of China that the details of its agreements with other countries are never made public.
Oli during his China visit met President Xi Jinping, Premier Li Qiang and several other senior leaders. A total of ten agreements were signed including BRI cooperation agreement and MoU on Economic and Technical Cooperation, MoU on the Development Plan 2025-2029 and the MoU on Nepal–China Trade Promotion. Oli also addressed a programme in the Peking University. Oli requested Chinese businessmen to invest in China and Chinese people to visit Nepal as tourists. China also promised financial grant of USD 20 million and RMB 500 million. Oli also discussed with his counterpart about industrial and infrastructural development, increasing of connectivity, development of tourism and trade, medical cooperation, agricultural development, science and technology, disaster management and poverty alleviation.
Letters were also exchanged about the construction of Tokha-Chhahari tunnel road near Kathmandu. MOUs were signed on the export of thermally processed buffalo meat to China, Chinese language education in Nepal and cooperation between Nepal Television and China media group, certification for the completion of the reconstruction of the Basantapur-based Nine-Storey Palace in Kathmandu was also handed over by Chinese government to the visiting delegation. Oli also emphasised that no anti-China activity would be allowed in Nepal.
Oli’s Chinese visit had broken the tradition, so far followed by all the Prime Ministers, of visiting India as their first foreign visit. By breaking the tradition Oli demonstrated that he gives priority to China over India. The anti-India lobby in Nepal claimed that the relations between Nepal and China are growing as Beijing supports Nepal maintaining its independence, territorial integrity and also respects Kathmandu’s choice of the way it wants to develop the country. The China-Nepal joint statement mentions that “the two sides agreed to jointly advance the fourth phase of the China-aided Araniko Highway maintenance project and the Hilsa-Simikot Road project, implement the second phase of the Kathmandu Ring Road Improvement Project, and welcome the signing of the Letters of Exchange for the Approval of the China-aid Project of Feasibility Study for the Tokha-Chhahare Tunnel.” Oli expressed gratefulness to China for extending support and constructing projects so that Nepal became a “land linked” country from a “land locked country.”
The independent Nepal watchers claim that Oli’s China centric policies and acceptance of BRI would compel Nepal to plunge in China’s debt trap policies. They give the examples of Sri Lanka, Pakistan, Maldives and of African countries which are unable to pay their debt and either want bail out packages from International Monetary Fund (IMF) or request the creditor to reschedule the debt or adopt both the strategies. Oli’s coalition partners especially Nepali Congress is against taking debt from China.
The Foreign Minister of Nepal Arzu Rana Deuba who is from Nepali Congress told her counterpart during her visit to China that Kathmandu is not in a position to take loans. It will accept only grants and aid hence China should extend grants and assistance to complete the projects. However, China overtly claim to develop infrastructure projects in third world countries but soon they fall under the debt trap strategy of China. Nepali Congress (NC) an important coalition partner of Oli and his party CPN-UML have different views about BRI. The NC mentions that the fragile economy of Nepal cannot sustain loan from China hence it should only accept grants while Oli wants to have loan from China so that infrastructure projects which are essential for the progress of the country are built. Oli’s approach suits Beijing as it wants to give loan which is the important part of its debt trap strategy. China is pursuing hard to extend loan facility to complete the projects under BRI, after parliament of Nepal sanctioned an infrastructure grant of $500 million from the U.S. Millennium Challenge Corp. in 2022.
N.C. leaders sight the example of the Pokhara airport fiasco under which China gave a loan of $216 million to Nepal to build an international airport at Pokhara which is the second largest city of Nepal after Kathmandu. The airport started functioning from last year but there is lack of international flights. Chinese have not conducted the proper survey that the country does not need another international airport at present and Nepal has dependence on Indian airspace. As proper realistic survey was not conducted by China, Nepalese taxpayers are paying for the construction of Pokhara airport which is of no use for Nepal. NC and others claim that China constructs gigantic infrastructure projects by showing huge profits but later these projects becomes white elephants, and the country come under debt trap of China. In view of the opposition of NC, Oli promised that he would not sign any agreement with loan during his China visit.
Nepalese claim that Nepal India relations are cordial, and Oli met Prime Minister Modi in September in New York in the sidelines of U.N. General Assembly session. In the meeting Oli invited Modi to visit Nepal and he promised to visit Nepal soon.
India was also watching Oli’s China visit. First of all, Oli had broken the tradition of making first foreign trip to India after taking oath of Prime Ministership. Delhi which is aware of his pro-China leanings and his anti-India attitude, had not sent a formal invitation to visit India. There were frictions on overflight rights as well as there were border disagreements between both the countries. In his last tenure Oli signed partnership accords with China and also had joined military exercises which were suspended during COVID pandemic. Oli’s operationalising of BRI in Nepal is against Indian interests and India downright rejected BRI. India’s assessment is proving correct and most of the countries which joined BRI are reeling under Chinese debt.
The bilateral trade between India and Nepal in Financial Year 2022-2023 was about $8.85 billion which is 64.1% of the total trade of Nepal while China’s bilateral trade is only 14%. India’s export to Nepal is $8.015 billion while the import is $839.62 million. But China is a bigger creditor as it gave loan of more than $310 million. The trade volume between Nepal and China is enhancing and there was an increase on 9.1%.
Nepal is heavily dependent on India’s financial and development assistance while India also understands Nepal’s strategic position between China and India. Oli is a shrewd politician and would like to have maximum benefits from India and China. In fact, Maldives and Sri Lanka have also adopted the same strategy and try to extract maximum assistance from India and China. Oli and his party flares anti-India feelings by falsely propagating that India has imperious attitude toward Nepal and resorts to economic blockades. In nutshell Oli has to do a difficult balancing act with his coalition partner as well as between India and China two giant neighbours.
Although Oli is pro-China but if he leans too much towards China, he may lose his coalition partners, and his government would fall. Oli should also keep India’s interests in mind as both countries maintained peaceful and cordial relations from centuries. The disturbance in harmonious relations would harm both India and Nepal. Pushpa Kamal Dahal alias Prachanda former Prime Minister and an important figure in Nepalese politics has rightly pointed out that Nepal should balance between India and China. Nepal’s growing dependence on Beijing may create a trouble for the Himalayan kingdom as its geographical location compels it to have cordial relations with both the countries.
Comments