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Nepal signs framework agreement with China under Belt and Road Initiative
(MENAFN) Nepal has signed a framework agreement with China under the Belt and Road Initiative (BRI) during Prime Minister KP Sharma Oli's recent visit to Beijing. After years of uncertainty, this agreement marks a significant step for Nepal, which had previously signed a Memorandum of Understanding (MoU) in 2017 but delayed further action due to financing concerns and its cautious approach towards India. While China initially proposed loans, Nepal preferred grants, a sensitive issue given its close ties with neighboring India.
The final agreement includes a flexible financing model that combines both grants and concessional loans, avoiding any exclusive commitment to loans from China. This compromise allowed both sides to move forward, balancing their interests. Nepal's domestic political dynamics also played a role, as the ruling coalition, comprising the left-wing Nepal Communist Party (CPN-UML) and the right-wing Nepali Congress, had differing views on the BRI. Despite internal disagreements, both parties agreed on the country's participation in the initiative, signaling a unified approach to foreign policy.
Oli emphasized that Nepal's foreign policy should remain balanced, fostering positive relations with both China and India.
The final agreement includes a flexible financing model that combines both grants and concessional loans, avoiding any exclusive commitment to loans from China. This compromise allowed both sides to move forward, balancing their interests. Nepal's domestic political dynamics also played a role, as the ruling coalition, comprising the left-wing Nepal Communist Party (CPN-UML) and the right-wing Nepali Congress, had differing views on the BRI. Despite internal disagreements, both parties agreed on the country's participation in the initiative, signaling a unified approach to foreign policy.
Oli emphasized that Nepal's foreign policy should remain balanced, fostering positive relations with both China and India.
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