China-Nepal Relations
China and Nepal have been maintaining strong and friendly bilateral relations since the establishment of diplomatic ties in 1955. In recent months, China has been actively courting Nepal, especially since the country’s new Prime Minister, Pushpa Kamal Dahal, took office in August 2016. China has been a major investor in Nepal, providing loans and grants for infrastructure, and has been offering to increase its engagement in Nepal’s development.
China’s Growing Interest in Nepal
China’s growing interest in Nepal is mainly due to its strategic location. It is situated between two large countries – India and China, and the two countries have been competing for influence in the region. Nepal, on the other hand, is trying to take advantage of the competition to gain both economic and political benefits. As a result, China has been stepping up its efforts to court Nepal and strengthen the bilateral relationship.
Bilateral Cooperation
China and Nepal have been working together in various fields, such as infrastructure, trade and investment, energy, tourism, education, and science and technology. In recent years, China has been providing Nepal with large loans and grants for various infrastructure projects. This includes the construction of roads, bridges, airports, and railway lines. China has also been helping Nepal tap into its hydroelectric potential by funding and building hydropower projects.
China-Nepal Economic and Technical Cooperation Agreement
In 2016, China and Nepal signed the China-Nepal Economic and Technical Cooperation Agreement, which is aimed at deepening economic cooperation between the two countries. Under the agreement, China has committed to providing Nepal with an additional US$8 billion in grants and loans. This money is to be used to fund infrastructure projects such as roads, bridges, and hydropower projects, as well as to support the development of industry and technology in Nepal.
Investment Promotion Agreement
In 2017, China and Nepal also signed an Investment Promotion Agreement, which is aimed at encouraging Chinese investment in Nepal. Under the agreement, Chinese investors will be able to invest in various sectors, including infrastructure, energy, tourism, and technology. It will also allow Chinese companies to take advantage of the preferential tax rates and other incentives that are available in Nepal.
Belt and Road Initiative
In 2018, China and Nepal signed a Memorandum of Understanding on the Belt and Road Initiative. This initiative is a major Chinese foreign policy initiative that aims to build infrastructure and other projects in countries along the ancient Silk Road. Nepal is an important part of this initiative, and China is planning to invest in infrastructure projects in the country.
China-Nepal Railway Project
One of the most ambitious projects that China and Nepal are working on is the China-Nepal railway link. This railway project will connect the cities of Lhasa in Tibet and Kathmandu in Nepal, and is expected to be completed by 2022. It is being built with the help of Chinese loans and grants, and is expected to improve connectivity between the two countries.
Conclusion
China has been actively courting Nepal in recent years, and has been providing loans and grants for infrastructure and other development projects in the country. The two countries have signed several agreements to encourage Chinese investments in Nepal and to deepen economic cooperation between the two countries. China is also planning to invest in infrastructure projects in Nepal under its Belt and Road Initiative, and the two countries are collaborating on the ambitious China-Nepal railway project. All of these efforts show that China is strongly committed to deepening its relationship with Nepal.
