BRI In 5th Year Sino-Nepal Ties See Momentum
Ritu Raj Subedi
With China’s ambitious project, Belt and Road (BRI), entering the 5th year, Nepal and China have made another breakthrough in their bilateral ties. The two countries have finally agreed on the protocol to Transit and Transport Agreement (TTA), which practically ended Nepal’s dependency on India for the export and import of goods to and from the third countries. China has allowed Nepal using its four sea and three dry ports for third country trade. Nepal has got access to Tianjin, Shenzhen, Lianyungang and Zhanjiang (seaports) and Lanzhou, Lhasa and Xigatse (dry ports) to conduct trade and commerce with third countries. Nepal can use any form of transport – rail or road – to access the sea ports. Likewise, Nepal will get access to the Chinese territory through six checkpoints - Rasuwa, Tatopani (Sindhupalchowk), Korala (Mustang), Kimathanka (Sankhuwasabha), Yari (Humla) and Olangchung Gola (Taplejung). The protocol agreement facilitates Nepal to trade with North East Asian countries such as Japan and Korea. It effectively connects Nepal to the BRI network, thereby boosting connectivity, trade, economic integration and people-to-people relations not only with China but also with those nations that are party to the BRI.
This also marks a pleasant coincidence for Prime Minister KP Sharma Oli. During his first premiership, Nepal had entered a historic trade and transit treaty with China in 2016 after the 2015 Indian blockade exposed the country’s economic vulnerability. The unofficial embargo that India imposed on Nepal showing reservations over the contents of new constitution created a humanitarian crisis. The shortage of gas, fuel, medicines, food and construction materials brought the Himalayan nation to its knees. The country had woken up to its defective geopolitical relations and moved to push the Himalayan frontiers to ensure functional trade and economic ties with China. Nepal had inked a 10-point agreement, including trade and transit one, with China against this backdrop. But the historic accord cost Oli’s premiership and it was left in limbo. The two governments, formed after toppling Oli from his executive post, intentionally delayed in implementing the landmark accord. It was virtually in a state of suspended animation. Under the mounting domestic pressure, the government under erstwhile CPM-Maoist Centre chair Pushpa Kamal Dahal signed an accord on joining the BRI. But the government under Sher Bahadur Deuba showed a total apathy towards materializing the agreement.
It got ahead only after PM Oli visited China in the third week of last June. He oversaw the signing of altogether 14 bilateral agreements between Nepal and China. They mutually agreed to finalise the protocol to TTA later after sorting out technical issues such as choosing the sea ports that are easily accessible to Nepali traders. The two nations concluded negotiations on the protocol to TTA at a time when the Indian ruling Bharatiya Janata Party (BJP) is coaxing Nepal into accepting a ‘Look South’ policy so that it does not move closer to China. Sometime ago BJP general secretary Ram Madhav asked Nepal to espouse a “Look South” policy based on Indian PM Narendra Modi’s “Neighborhood First” policy. He also claimed that the ‘Look South’ approach would enable Nepal to get access to the Indian Ocean region through India’s Calcutta port and Bangladesh’s Chittagong port. Given the past bitter experiences, Nepal is unlikely to take the bait. As Nepal is now better positioned to execute independent and balanced foreign policies, it should look to all directions - south, north, west and east - to achieve enduring peace, inclusive growth and durable democratic order.
Still the ‘Look South’ policy does not overcome Nepal’s fundamental geopolitical problem – it does not bring an end to a condition of facing another blockade from India in the future. Despite all rhetoric of ‘unique, excellent and incomparable’ relations with India, Nepal endured four blockades from the southern neighbour since it got independence in 1947. So it was essential to forge a comprehensive cooperative partnership with China for its own national interest. Nepal aspires to attain greater economic sovereignty and spread its geopolitical wings beyond the region through the BRI. India should not take it otherwise when its small neighbour becomes happy and prosperous through meaningful application of the ‘Look North’ policy. An unstable and poor neighbour can be a constant source of nuisance for it. Quite the contrary, a peaceful and affluence neighbour produces a virtuous circle for its population living near the border.
Meanwhile, there is tangible progress in the direction of constructing the Kerung-Kathmandu railway that forms the critical component of BRI in Nepal-China relations. Both are now in the process of preparing a detailed project report (DPR) after completing its technical study. A Chinese team is coming next month to ink an agreement on the preparation of DPR that takes more than one-and-a-half years to complete. The 72.25-km railway project, estimated to cost Rs 257 billion, is expected to be ready in nine years. During Prime Minister KP Sharma Oli’s visit to China last June, the two nations agreed to ‘intensify implementation of the MoU on cooperation under the BRI to enhance connectivity, encompassing such vital components as ports, roads, railways, aviation and communications within the overarching framework of trans-Himalayan Multi-Dimensional Connectivity Network’. Both countries have described the deal on railway connectivity as the ‘most significant initiative in the history of bilateral cooperation’.
Five years on, the BRI has made significant strides in the field of policy coordination, production capacity cooperation, financial service and people-to-people exchanges, according to the latest data compiled by the State Information Centre and the Dalian Infobank Co., China. “The concept of extensive consultation, joint contribution and shared benefits, upheld by the BRI, has gained wide recognition in the global arena. It has brought tangible benefits to the people of relevant countries,” said Meng Wei, spokesperson of China’s National Development and Reform Commission, adding that the BRI construction was an open and inclusive international cooperation platform. China has signed 103 cooperation agreements with 88 countries and international organisations under the BRI framework. More than 8,000 China-Europe freight trains have been dispatched to 14 European countries and 42 cities. Goods traded between China and related countries have exceeded 5 trillion U.S. dollars. Silk Road Fund has supported 19 B&R projects involving 80 billion U.S. dollars. China has signed cultural agreements with over 60 countries under the International Coalition for Green Development, according to the Centre.
As the United States is engaged in trade wars with its allies and rivals, China has strengthened its position on the global stage. Chinese President Xi Jinping has stepped into the breach in the defence of fair economic globalisation, rule-based international order and ecological civilisation. BRI being his pet project, Xi has been able to shrug off the ‘China threat theory’ and ‘myth of debt trap’ concocted by the western scholars and media. In his latest bid to enforce BRI, he announced a total of 60 billion U.S. dollars of financing to Africa at the recent 2018 Beijing Summit of the Forum on China-Africa Cooperation. “The financing will be provided in the form of government assistance as well as investment and financing by financial institutions and companies,” Xi said. African continent that was colonized, harassed and plundered by the western powers is now witnessing unprecedented level of economic development, especially in the field of infrastructure, business, industries, education and health of people. Upbeat about the success of BRI projects, China is determined to expand across the globe for win-win economic cooperation and shared benefits.