Nepal and China Sign Framework for Belt and Road Initiative, Ushering in New Era of Cooperation.
Paving Aay for Progress on Projects
On December 4, 2024, Nepal and China signed a landmark agreement – the Framework for Belt and Road Cooperation (FBRC) – in Beijing.
Read More: CPEC & BRI 2024 and Beyond
KATHMANDU: Nepal has signed a framework agreement with China on the Belt and Road initiative after an initial pact was signed seven years ago but no progress made since, paving the way for cooperation on projects, its foreign ministry said on Wednesday.
Prime Minister K.P. Sharma Oli`s Visit to China Fruitful
Prime Minister K.P. Sharma Oli has been in Beijing since Monday on a four-day visit, his first to a foreign country since his July swearing-in, breaking tradition by not making New Delhi, with which Kathmandu has centuries-old ties, his first foreign port of call. Nepal and China Sign Framework for Belt and Road Initiative
Nepal and China signed an initial deal in 2017 for President Xi Jinping’s Belt and Road Initiative, which aims to build China’s infrastructure and trade links with the world.
However, no projects have been planned or begun in the past seven years, as a framework for cooperation had not been set and as Nepal struggled to get consensus from its political parties.
A Comprehensive Deal: Nepal and China Sign Framework for Belt and Road Initiative
The signing of the deal on Wednesday implies that both countries will now move ahead with details of projects, which may include road upgrades and transportation corridors, and how to finance them.
Debt concerns have, meanwhile, spurred debate within Oli’s coalition government, with the Nepali Congress party, a key supporter of Oli, opposing any project funded by loans.
Nepal and China “signed the Framework for Belt and Road Cooperation today,” Nepal’s foreign ministry said in a post on X, without giving details.
China has loaned Nepal $216 million
China has loaned Nepal $216 million to build an international airport in Pokhara, the second-largest city about 125 km (80 miles) west of Kathmandu, which began operating last year.
But the Chinese-built airport, which Beijing claims as the symbol of Belt and Road success, has faced problems of a lack of international flights there, thanks to India not letting planes use its airspace.
This agreement marks a significant step forward in the two countries’ collaboration on the Belt and Road Initiative (BRI), a massive infrastructure development project launched by China in 2013. (See: Belt and Road Initiative Wikipedia)
Previous Roadblocks Overcome
Nepal initially signed onto the BRI in 2017, but progress on projects stalled due to internal political disagreements and a lack of consensus on financing models. The FBRC aims to clear these hurdles by establishing a clear framework for cooperation, outlining project selection and financing mechanisms.
What Does the FBRC Mean for Nepal?
The signing of the FBRC paves the way for a number of potential benefits for Nepal, including:
- Infrastructure Development: The BRI prioritizes infrastructure projects like roads, railways, and power grids. Nepal stands to gain significant improvements in its transportation and energy sectors, potentially boosting its trade capabilities and economic development. (See: How Infrastructure Development Impacts Trade and Economic Growth Munafa Marketing [invalid URL removed])
- Increased Investment: The BRI promises increased foreign direct investment (FDI) in Nepal. This could provide much-needed capital for infrastructure projects and help create jobs.
- Enhanced Connectivity: Improved infrastructure can connect Nepal more effectively with China and other regional partners, facilitating trade and tourism.
- Knowledge Transfer: Technology and expertise sharing as part of BRI projects can help Nepal develop its own infrastructure capabilities.
Addressing Concerns and Ensuring Transparency: Nepal and China Sign Framework for Belt and Road Initiative
Despite the potential benefits, the BRI has also attracted some criticism. Concerns include:
- Debt Burden: There are worries that Nepal could become heavily indebted to China in financing these projects. Transparent project financing and careful cost-benefit analysis are crucial to mitigate such risks.
- Environmental Impact: Large infrastructure projects can have environmental consequences. Nepal must prioritize sustainable development practices in project execution.
- Social Impact: Displacement of communities and potential for corruption require careful social safeguards and strong governance structures.
The Road Ahead: Nepal and China Sign Framework for Belt and Road Initiative
The signing of the FBRC marks the beginning of a new chapter in Nepal-China cooperation.
With careful planning, transparent execution, and addressing potential concerns, the BRI can be a driver for Nepal’s economic development and connectivity.
As the details of specific projects are finalized, Nepal and China will need to work together to ensure responsible and sustainable implementation.
Looking Forward: Nepal and China Sign Framework for Belt and Road Initiative
It will be interesting to see how the FBRC shapes the development of specific BRI projects in Nepal.
Munafa Marketing will continue to monitor this evolving partnership and provide updates on project details and their potential impact. (See: Munafa Marketing – Business News and Industry Insights Munafa Marketing)
Nepal and China Sign Framework for Belt and Road Initiative, Ushering in New Era of Cooperation
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