Nepal has signed a framework agreement with China on the Belt and Road Initiative (BRI), paving the way for China's growing influence in the country. Although a preliminary agreement was signed seven years ago, the lack of progress had stalled implementation. This new deal aims to facilitate project execution.
Nepal's Ministry of Foreign Affairs disclosed the agreement on Wednesday, December 4, according to Reuters.
Nepali Prime Minister K.P. Sharma Oli, currently on a four-day visit to Beijing, has prioritized strengthening ties with China over traditional first visits to New Delhi. This is his first foreign trip since taking office in July.
A preliminary BRI agreement between Nepal and China was signed in 2017 as part of China's global infrastructure and trade connectivity initiative. However, the absence of a structured framework and political consensus in Nepal prevented any project implementation over the past seven years.
Under the new agreement, both countries will plan and implement projects like road development and transport corridors while deciding on financing mechanisms. However, concerns over debt have sparked debates within Oli's coalition government, with the Nepali Congress opposing any loan-dependent projects.
Nepal's Ministry of Foreign Affairs announced on X (formerly Twitter), "Nepal and China have signed a framework for Belt and Road Cooperation today." Further details have not been disclosed.
China has already provided a $216 million loan to Nepal for constructing an international airport in Pokhara, located 125 km from Kathmandu, which became operational last year. While China hails it as a BRI success, the airport faces challenges due to the lack of international flights, as Indian airspace access remains restricted.
India's influence in South Asia appears to be waning, with mounting concerns over ties with Sri Lanka, the Maldives, and Bangladesh. Nepal's growing proximity to China and the new BRI agreement further intensify Delhi's unease.