April 24, 2019 02:00 AM NPT
President Bidya Devi Bhandari is leaving for a state visit to China today to participate in the second Belt and Road Forum for International Cooperation, being held in Beijing. President is scheduled to take part in a roundtable to be hosted by her Chinese counterpart Xi Jinping and hold bilateral talks with him on April 29. Nepal-China Transit Transport Agreement Protocol is also expected to be signed. The protocol paves the way for the implementation of the agreement and allows Nepal third country transit facilities via Chinese ports. Apart from this, a joint communiqué is expected to be signed, which will incorporate BRI projects for Nepal, mainly cross-border connectivity project known as the Trans Himalayan Multi-Dimensional Connectivity Network, encompassing vital components such as ports, roads, railways, aviation and communications. Also funding modality for these projects—whether through grant or foreign direct investment, concessional loan or loan from the Asian Infrastructure Investment Bank—is expected to be finalized. Nepal stands at a point in which it has to speed up its connectivity infrastructures—such as road and railways—for which it will need a huge infusion of foreign direct investment, grants or concessional loans. President’s visit to China could be instrumental in bringing in much needed-investment for the country.
However, in recent times, there have been concerns about issues of debt that Chinese investment could potentially inflict on Chinese aid receiving countries. To be sure, BRI is a grand Chinese undertaking of this century, which apart from other components, has its focus on expanding connectivity to Asia, Europe and beyond. At the same time, there have also been issues related to unsustainable loans in some of the countries where China has invested. What will happen if Nepal somehow comes to face the same fate is the question being raised in various quarters. Meanwhile, Minister for Foreign Affairs Pradeep Kumar Gyawali has called the whole story of BRI debt trap as ‘suggestions motivated by bias.’ On Monday, Minister Gyawali reassured the media that Nepal is aware of what it should do and should not do to fulfill its national interests and that Nepal is free to decide on its development initiatives. This is how it should be. Apparently, Nepali ministers and officials are convinced that connectivity projects with China will not result in debt burden for Nepal.
Nepal has been receiving aids and loans from various development partners and multilateral agencies such as the World Bank and the Asian Development Bank. In September last year, the US Government’s Millennium Challenge Corporation (MCC) and Government of Nepal signed a $500 million compact, the main focus of which is to strengthen Nepal’s energy sector, improve regional energy connectivity, and encourage growth. Likewise, countries like India have also provided financial assistance for various Nepali projects. We believe that with the BRI projects, Nepal needs to be able to identify what serves our interest best and move forward with it accordingly. If our infrastructure development needs are served, Nepal should welcome investment from any country in the world, including China. Rather than thinking of where the investment is coming from, which particular country or multilateral agency, we need to be able to assess whether such assistance meets our development aspirations. As long this aspiration is met, investment from any country should be welcome.