The Belt and Road Initiative was signed by China and Nepal on Sunday, but the two countries are still working to finish the BRI’s implementation plan, which China suggested in the early months of 2020.On May 12, 2017, China and Nepal signed a memorandum of understanding on the One Belt One Road, or BRI, which is China President Xi Jinping’s flagship initiative. The agreement is subject to renewal every three years. Still, there is a divergence of views on whether Nepal needs a dedicated BRI implementation plan to execute the projects under the Chinese initiative, senior government leaders and officials told the Post. Hence there is no clarity over when and how the implementation plan will be signed.
The draft titled “Implementation Plan on Jointly Building the Belt and Road Initiative between the Government of the People’s Republic of China and the Government of Nepal” is currently under the purview of the National Planning Commission for its redrafting/processing.There was a general understanding between Nepal and China to sign the BRI implementation plan during the China visit of Prime Minister Pushpa Kamal Dahal in September last year as well as during the visit of Deputy Prime Minister and Minister for Foreign Affairs, Narayan Kaji Shrestha, in March this year. But there was little progress on both the visits and the signing was indefinitely postponed.
The draft of the BRI implementation plan is not ready yet, DPM Shrestha said. It is said to be in the final stage of completion. Shrestha says he tried to push the plan in his interactions with the Chinese side but there has been no progress.One senior government official told the Post that the elections in India are the primary reason the plan has not made headway in China.No sensitive decision that may hurt relations with India and China will be taken around election time, said an official at the prime minister’s office who is privy to the issue.Shrestha said that projects under the BRI will be selected only after the plan’s signing.
“It is our position that we will select a new set of projects only after signing the BRI implementation plan,” Shrestha told the Post.Asked about the nine projects selected during the tenure of KP Sharma Oli as the prime minister in 2019-20, Shrestha said they now have only referential value.The text of the BRI implementation plan, which Nepal first received in early 2020 after Chinese President Xi Jinping’s Nepal visit, is a comprehensive document that outlines nine clusters: economic cooperation, agriculture, education, connectivity, trade, investment, tourism, culture, and people-to-people cooperation.
It said that the two sides would identify projects, discuss the investment modality and the way to execute it. After several rounds of exchanging text and comments, the Chinese side in October 2021 sent their draft to the Sher Bahadur Deuba government.After Deuba became the prime minister, China’s State Councilor and Foreign Minister Wang Yi came to Nepal on an official visit. He then shared that Beijing has reservations over the financing modality of the projects to be undertaken under the BRI; Nepal had made it clear that it cannot afford loans with over 1 percent interest to implement the projects, and the country prioritised grants and concessional loans.
“The country’s economic situation has not improved. We are not in a position to take loans from anywhere including China as they would increase pressure on the weak Nepali economy,” said an official at the Prime Minister’s Office.Amid the delays, China last year started the “Silkroad Roadster” in Nepal, focusing on some small-scale projects.Nepal gave continuity to its old position when Prime Minister Dahal visited China in September-October last year. “When the issue of BRI was discussed in Beijing during the prime minister’s trip, we told the Chinese authorities that we will sign the implementation plan at an ‘appropriate’ time,” former foreign minister NP Saud, a Nepali Congress leader, said. “We also conveyed to the Chinese officials and leaders that our preference is grant, not loan.”
The Congress and other political parties have called for a national consensus on vital issues like the BRI or any other development or economic vehicle with far-reaching consequences for the country.Apart from the investment modality, Nepal also has reservations over a clause of the BRI implementation plan dealing with security concerns.A former minister familiar with the plan expresses reservations over the text handed over by the Chinese, which Nepal wants to amend before signing or avoid.The document’s sub-section 12 titled ‘Other Areas’ under section 3 named ‘Cooperation Priorities’ mentions that “the two sides will strengthen legal cooperation and actively carry out diverse legal exchanges and capacity building in order to facilitate B&R [belt and road] cooperation”.
It also says “the two sides will implement relevant agreements on law enforcement cooperation and strengthen security cooperation through joint training, information exchange, and capacity building, including for disaster management”.Beijing accords the BRI top foreign policy priority. In every high-level visit and meeting between Nepal and China, the initiative gets traction.Although there is no clear provision on whether the two sides should renew the agreement by exchanging correspondence, officials at the finance ministry said that would be the diplomatically correct way to go about it.
There are concerns over the BRI’s stalled momentum in Nepal. The initiative’s stated focus is connectivity, trade, development strategies, and policy dialogues for cooperation in the fields of economy, environment, technology and culture.The agreement also aims to facilitate transit transport, logistics, transport network security and related infrastructure development through joint study and promote cross-border projects including railway, road, civil aviation, power grid, information and communication. The MoU also states that the two sides would conclude the joint feasibility study of China-Nepal Free Trade Agreement shortly and, if viable, start negotiations on a Free Trade Agreement to open up more markets and expand bilateral trade.
Source: Here