KATHMANDU, Dec 23: Amidst persisting strains in Nepal-India trade relations following the Indian imposed supply blockade on major trade routes linking the landlocked country with India, a 10-member high-level government team is leaving for China on Wednesday to hold government to government (G2G) talks with China and settle numerous trade-related issues with the northern neighbor.
The government team led by Deputy Prime Minister and Minister for Foreign Affairs Kamal Thapa includes the secretaries at the Ministries of Finance, Commerce and Foreign Affairs as well as Minister for Law, Justice and Parliamentary Affairs Agni Prasad Kharel. The team is to discuss and settle trade issues with the northern neighbor, including a trade and transit agreement, a Bilateral Investment Promotion and Protection Agreement (BIPPA), a commercial fuel agreement, and issues related to connectivity, among other things.
Though Nepal as a landlocked country enjoys transit access to the sea through China and India, it has a transit agreement with India alone. Similarly, Nepal has not signed a BIPPA with China though the northern neighbor had sent a draft BIPPA to Nepal four years ago. Nepal sent its feedback on the draft BIPPA to China last year.
Similarly, a commercial petroleum trade agreement with China has been pending for long due to issues related to taxes and infrastructure development. Nepal signed a framework agreement with China on October 29 for the supply of one-third of its requirements of petroleum products.
“The government team will have a series of dialogues with Chinese state leaders along with the Chinese foreign minister, on issues related to diversifying Nepal’s trade with China,” spokesperson of the Ministry of Foreign Affairs (MoFA) Tara Prasad Pokharel told Republica, adding, “The visit primarily intends to facilitate different trade issues and other areas of bilateral relations with China.”
However, Pokharel voiced uncertainty over the sealing of all trade agreements with China by the high-level government team. “Rather, the team will try settling every trade issue with China that needs to be settled through a government level.”
“Long-term and sustainable agreements on trade require dialogue at a higher level between the governments of the two countries. The government team will focus on settling both minor and major issues that are delaying the trade agreements,” Pokharel added.
Meanwhile, Pokharel also said that an agreement on the economic aid to Nepal worth 900 million RMB (Rs 14.5 billion) that China announced in March will also be signed during Deputy Prime Minister Thapa’s five-day visit. The Chinese assistance is to be used to upgrade the 115-kilometer Araniko Highway that links Nepal with China.
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