As part of Beijing’s reinvigorated economic diplomacy for Nepal, China on Sunday announced that visa fees for Nepali tourists would be waived as of May 1 and that commercial flights would begin to Nepal’s two new international airports—which are tainted by geopolitics.India, on the other side, promised to use hydro energy trade to bring prosperity to Nepal.Speaking at the third Nepal Investment Summit in Nepal’s capital Kathmandu, Luo Zhaohui, the chairman of China International Development Cooperation Agency (CIDCA), said the Chinese government will continue to attach great importance to direct and indirect investment in Nepal to implement the Trans-Himalaya dimensional connectivity, which is the highest priority for countries.
“Air and road links and border checkpoints are going well. Feasibility studies of the cross-border railway and cross-border transmission lines are moving forward,” he said. “That’s why, today’s summit is of very special significance.”The Chinese government is making arrangements to start new flights from China to Nepal’s two new international airports—Pokhara and Lumbini. “In this regard, I have good news to share with you that from May 1, or after three days, there will be no visa fee for the Nepali people to [visit] China,” said Luo. Nepal’s $216 million international airport in Pokhara, the country’s tourism capital, funded by Beijing, opened in January last year.
Similarly, Nepal’s second international airport in Bhairahawa, built by Chinese contractors, started its operation in May 2022 after four years of construction delays. The objective of both projects is to decentralise economic activities in the new federal setup, to bring in more tourists, and stop Nepalis from going abroad. But no single international flight is operating in the two new shiny airports, which critics say is due to the air route issue, which India is reluctant to provide to Nepal. Without entry routes from the southwestern points, these airports have higher operating costs for any airlines entering Nepal from the west. Nepal has been prodding New Delhi for over a decade to open new air corridors but to no avail.
The air route issue, however, does not affect Chinese airlines as they enter and exit Nepal from the northern and eastern border points of Nepal. Luo said that one of the major achievements between the two neighbours is the agreement to build the Trans Himalaya All-dimensional Connectivity Network. “Last September, Nepal’s Prime Minister Pushpa Kamal Dahal paid an official visit to China. Our leaders have reached an important consensus guiding our future cooperation. All these fruits are in the process of implementation.”
“I’m satisfied to note that more than 350 entrepreneurs from China participated in today’s function. It shows how the Chinese government and Chinese entrepreneurs show their strong interest in Nepal.” One of the important policies the Chinese entrepreneurs are quite interested in is to have a bilateral free trade agreement (FTA) arrangements between the two countries, he said. An FTA reduces barriers to imports and exports between countries by eliminating all or most tariffs, quotas, subsidies, and prohibitions. “That will be a key to improving Nepal’s investment environment to attract more Chinese investment,” said Luo ending his speech with a Chinese saying, “Build a good nest to attract the phoenix.”
The third edition of the Nepal Investment Summit brought together more than 1,100 foreign participants in Nepal’s capital, Kathmandu, mostly from two immediate neighbours India and China. To mark the beginning of the summit, the Investment Board Nepal, on Sunday, invited Expressions of Interest (EOI) for 12 projects from potential investors. The government has offered 148 potential projects, with nearly Rs900 billion worth of ready-to-go projects, to foreign and domestic investors. Most projects, according to the Investment Board Nepal, are related to hydropower, and officials are hopeful that the sector will attract investment from energy-hungry India.
While China claimed that it currently is the top source of FDI for Nepal, India said it has the highest FDI stock in Nepal.Naveen Srivastava, ambassador of India to Nepal, said India currently is the biggest cumulative FDI investor in Nepal, with more than 33 percent of Nepal’s FDI stock, which amounts to about Rs89 billion. “This investment trend continues its positive trajectory, and in recent times, we’ve seen new investments coming in sectors such as construction, automobiles, or FMCG [fast-moving consumer goods]. This is apart from the huge investment that India and Indian companies are making in the hydropower sector. As we look to the future, the government of India will continue to encourage Indian industry to invest further in Nepal.”
“The large presence of the Indian delegation today is a reflection of that commitment. We would also be launching a new investment guide for investment by Indian companies in Nepal in collaboration with the Nepal India Chambers of Commerce and Industry,” he said. “We’ve launched cross-border digital payments to facilitate an ever greater number of Indian tourists coming to Nepal. Indian tourists already constitute the largest number of foreign visitors to Nepal. In the last few years, hydropower exports from Nepal to India have added a new dimension to our ties. Last year alone, Nepal exported about 650 MW of power to India, earning a considerable revenue, which constituted about 10 percent of Nepal’s total export to India or 7 percent of Nepal’s global exports.”
Source: Here