Nepal’s premier on a China mission
Print Edition
CHINA has agreed to consider building a railway into Nepal and to start a feasibility study on a free trade agreement with the landlocked country.
The Himalayan nation adopted its first post-monarchy constitution in September hoping this would usher in peace and stability after years of conflict.
But protesters blocked trucks from India, leading to acute shortages of fuel and medicine. Nepal blamed New Delhi for siding with the protesters, a charge India denied.
The border blockade ended last month but oil and cooking gas supplies are far from normal.
Meeting in Beijing’s Great Hall of the People, Nepali Prime Minister K.P. Oli told Chinese Premier Li Keqiang he had “come to China on a special mission” to strengthen relations.
Hou Yanqi, deputy head of the Chinese foreign ministry’s Asia division, said Oli raised the possibility of two rail lines, one connecting three of Nepal’s most important cities and two others crossing the border from China into Nepal.
Hou said the government would encourage Chinese firms to look at the rail plan, and that China was already planning to extend the railway from the Tibetan city of Xigaze to Gyirong on the Nepal border.
“Of course, a further extension from Gyirong is an even longer-term plan. It’s up to geographic and technical conditions, financing ability. We believe that far in the future the two countries will be connected by rail,” she said.
The two countries signed a total of 10 agreements, including the free trade agreement feasibility study, as well a concessional loan for a new airport in Nepal’s Pokhara and a feasibility study for oil and gas survey projects.
Kathmandu says it wants to import 33 percent of the annual demand of 1.8 million tons of petroleum products from Beijing but trade officials say absence of connectivity — logistics, cost and transport through difficult Himalayan terrain — poses a challenge to any fuel trade between the two countries.
In recent years, China has become Nepal’s second-biggest trading partner and its major source of foreign direct investment.
China’s non-financial outbound direct investment in Nepal was over US$32 million in 2015. Bilateral trade hit US$866 million.
“China looks forward to seeing a peaceful and prosperous Nepal,” Li said, adding that China would boost “practical cooperation” in key areas including connectivity, industrial capacity, oil and gas, trade, tourism and law enforcement. He hoped the free-trade agreement feasibility study would start soon.
The government will also encourage Chinese banks to set up branches in Nepal, Li added.
Oli, on his first official visit to China as Nepali Prime Minister, said his country looked forward to benefiting from China’s development and said it will actively participate in China’s “Belt and Road” initiative.
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