Nepal and China speak highly of BRI

Nepal and China have reaffirmed their commitment to the Belt and Road Initiative (BRI), highlighting the framework agreement signed during Prime Minister KP Sharma Oli’s visit to China in December last year. This development has been described as a milestone in enhancing bilateral ties.

In a political document presented to the Central Committee of his party, CPN-UML, Oli emphasized the significance of the agreement for Nepal-China relations. While the ruling coalition’s Nepali Congress (NC) has remained silent on the matter, China has actively engaged with Nepal’s political leadership to implement the agreement. Both Nepal’s Ambassador to China, Krishna Prasad Oli, and Chinese Ambassador to Nepal, Chen Song, have expressed optimism about the initiative, using strikingly similar rhetoric on its potential benefits.

A new era of cooperation

Ambassador Oli noted that the framework agreement marks a turning point in bilateral cooperation under the BRI, nearly seven years after the initial memorandum of understanding. He stated that projects under the BRI would help transform Nepal from a landlocked to a land-linked nation. Citing examples, he mentioned plans to enhance the operational capacity of Bhairahawa and Pokhara international airports.

A centerpiece of this cooperation is the proposed cross-border railway between Nepal and China, part of the Trans-Himalayan Multi-Dimensional Connectivity Network. This ambitious project is envisioned to facilitate the flow of goods, people and services, further deepening Nepal-China ties.

Ambassador Oli dismissed concerns over a so-called ‘debt trap’ linked to Chinese financing, calling such claims baseless. In an interview with The Global Times, he underscored the BRI’s global success, noting its partnerships with over 150 countries in its decade-long history.

Progress on infrastructure

Feasibility studies for the cross-border railway are underway and expected to conclude by 2026. Upon completion, the project will enter the implementation phase. Additionally, efforts are being made to strengthen Nepal’s transmission grid lines, which are critical for enhancing regional connectivity.

Ambassador Oli also expressed Nepal’s support for China’s Global Development Initiative and Global Civilization Initiative, reflecting broader alignment with Beijing’s strategic priorities.

According to Chinese official media outlets, Ambassador has said that Nepal supports the initiatives launched by China which were not mentioned in the bilateral documents.

In a meeting with Yang Wanming, President of the Chinese People’s Association for Friendship with Foreign Countries, according to The Global Times, Oli stated that Nepal supports the Global Development initiative and Global Civilization initiative proposed by China.  

China’s perspective

Chinese Ambassador Chen Song echoed the sentiments of deepening mutual trust and cooperation.

In an interview with The Global Times, he described the BRI framework agreement as a symbol of growing political and economic ties between the two nations.

According to Chen, the agreement will not only enhance bilateral relations but also contribute to regional stability and development by fostering collaboration between China and South Asian countries.

Chen highlighted the BRI’s role in strengthening people-to-people exchanges and cultural cooperation, particularly in the tourism sector, according to The Global Times.

Addressing debt-trap concerns

Ambassador Chen countered accusations of a ‘debt trap’, citing data from Nepal’s Public Debt Management Office. As of the 2023-24 fiscal year, Nepal’s external debt stood at Rs 1.25trn ($9.12bn). Of this, multilateral loans constituted 88.98 percent, while bilateral loans made up only 11.02 percent. Among bilateral creditors, Japan and India ranked first and second, with China accounting for a modest 2.82 percent of Nepal’s total external debt.

Chen criticized Western narratives about Chinese loans as attempts to discredit China’s partnerships with developing nations. He emphasized China’s commitment to offering low-interest loans, development assistance and investments tailored to Nepal’s needs.

Political dynamics

Domestically, the ruling UML has showcased the BRI framework agreement as a major achievement of Prime Minister Oli’s government. However, the NC has largely remained noncommittal, while the main opposition CPN (Maoist Center) has downplayed the agreement, seemingly to avoid crediting the Oli administration.

Meanwhile, China has intensified its engagement in Nepal, lobbying for further progress under the BRI framework. This proactive approach underscores Beijing’s strategic interest in Nepal as a critical partner in its broader Belt and Road vision.