Nepal, China sign BRI framework, paves way for work on projects
- Nepal and China on Wednesday signed the execution framework for the Belt and Road Initiative (BRI) in Beijing, indicating that Nepal will soon decide on projects for implementation.
Highlights:
- During Nepalese Prime Minister K.P. Sharma Oli’s official visit to China, Nepal and China signed the execution framework for the Belt and Road Initiative (BRI) in Beijing. This agreement signals Nepal’s intention to identify and implement projects under the BRI.
Ambiguities in Funding Terms:
- Nepal’s Position on Grants: Nepal had previously stated it would only accept grants, citing its inability to bear loans for BRI projects.
- China’s Response: China removed the term “grant” from the agreement and replaced it with “investment,” leading to a compromise phrasing: “aid and technical assistance.”
- Concerns Over Ambiguity: The term “aid” has raised concerns in Nepal, as it can include loans disguised as financial support. This marks a departure from the Nepali Congress's firm stance on seeking only grants.
Political Implications:
- The vague terms of the agreement may create challenges for the K.P. Sharma Oli-led government:
- Potential Crisis: If the Nepali Congress, a key coalition partner, upholds its earlier position on grants, it could lead to political friction within the ruling coalition.
- Coalition Unity at Stake: The lack of clarity in funding mechanisms may strain relations between Oli’s government and coalition partners upon his return.
Broader Agreements and Benefits:
- MoUs Signed: Alongside the framework, nine additional agreements were signed to deepen cooperation.
- Bilateral Relations: Speaking at Peking University, PM Oli highlighted the BRI’s potential to strengthen Nepal-China ties and accelerate Nepal’s development.
Prelims Takeaways
- Belt and Road Initiative (BRI)