‘China dragging Nepal into BRI while stalling projects beneficial to it’

Nepal Prime Minister Pushpa Kamal Dahal has urged Chinese investors to invest in his country at the Nepal-China Investment and Business Forum 2023 in Kathmandu.
At the forum, Dahal also brought up the issue of the Nepal-China inland railway and transmission line, which has been under discussion for a long time, epardafas, a Nepal daily reported.
The Nepal Prime Minister said that discussions are being held with China for the expansion of the border in trade relations, and he also expressed concern over the increasing trade deficit with China. He also mentioned that foreign direct investment (FDI) has not been received from China as promised, the publication reported.
Nepal’s growing trade deficit with China and the “apparent gaps in China’s committed and actual FDI are some of the issues that a forum like this should try to address with a practical solution,” said Dahal.
Nepal has a long history of relations and assistance with its neighbouring country, China. In recent times, China has gained a grip on Nepal’s big projects. Chinese companies are involved in the construction of airports, hydropower projects, tunnels, roads, and dry ports.
Some of these projects have been completed and operational, while some have been stalled.
Some projects have been built by the Nepal government with Chinese loans. But now questions have started to arise about the justification and benefits of those projects. The construction of some projects has been delayed for years due to the negligence of Chinese companies.
Chinese company CAMC Engineering, Sino Hydro Corporation, Poly Changda, China Overseas, China State Construction Engineering and other companies are especially involved in Nepal’s big contracts.
The Damak Industrial Park, which is supposed to be built by China, is still stalled. The construction of this park, which was laid with pomp by promising to improve the economic condition of the country, provide employment for one lakh people, and to bring about a revolution in the industrial sector has been stalled for a long time.
Eight years have passed since the acquisition of land, and two years have passed since the foundation stone was laid, but the work has not yet progressed as the Chinese side is showing indifference.
On the one hand, there was the dissatisfaction of locals due to the decision made by the then Prime Minister KP Sharma Oli to appease China, on the other hand, the Chinese side itself has not been able to come forward for construction.
Among the other unfinished projects of the Chinese company are the Narayangadh-Butwal road section extension, Kalanki-Maharajganj ring road extension, Timure dry port and Syafrubesi-Rasuwagadhi road construction.
Similarly, Chinese companies have been delaying the construction of the tunnel of the Kathmandu-Tarai Expressway.
Some projects such as Pokhara Airport and Upper Tamakoshi Hydropower Project built by a Chinese company have been completed. However, these projects were also built some later than the scheduled time.
In this, the purpose of the Pokhara airport, which was built with China’s loan, is now being questioned. Various incidents have shown that there is a risk of flying in this airport, which was built without taking the environmental impact assessment seriously.
Especially because of birds and other animals, there is a problem with flying here. Therefore, the Nepal government is facing a problem in repaying the loan from China.
The Nepal-China railway has also been discussed for a long time. Even during the visits of Chinese President Xi Jinping and Former Chinese Foreign Minister Wang Yi, there have been various agreements regarding the progress of this project, but there is still no readiness to proceed with the work.
Not only railways, even the border points of Nepal’s Himalayan district including Humla, are connected to China, but they have not been started after the Covid-19 pandemic. Rasuwagadhi, the only operational border crossing with China, is also not fully operational.
On the other hand, China is forcing Nepal into its ambitious but controversial Belt and Road Initiative (BRI) project.
A few months ago, at the inauguration of Pokhara International Airport, an official of the Chinese Embassy in Nepal made a controversial statement that the airport was built under BRI.
Though China stated that Pokhara International Airport is built under BRI, it was contracted to China CAMC Engineering Co and was built with a concessional loan from China’s Exim Bank.
Similarly, the important thing to remember here is that the loan agreement was signed before Nepal became a part of the BRI.
Analysts say that while the government is inviting Chinese investors, their work should also be evaluated. Since the trade deficit with China has been increasing recently, economists say that emphasis should be placed on the access and market assurance of Nepali products in the Chinese market.
Prime Minister Dahal also expressed concern over the increase in trade deficit with China in the event. In the last fiscal year, while importing goods worth about 2 trillion 32 billion rupees from China, it exported only of 67 billion rupees.
Economists say that as Prime Minister Dahal said, the Chinese side and companies should be well prepared and also should be responsible for investment in Nepal.