Nepal is politically divided between those want to echo its neighbors’ growth and those who are wary of falling into a debt trap
After several long years of uncertainty, Nepal and China have signed a framework agreement on cooperation under the Belt and Road Initiative (BRI) – Beijing’s grand plan to develop new trade routes connecting it with the rest of the world. It happened earlier this month during Prime Minister KP Sharma Oli’s visit to Beijing.
In 2020, China’s government sent Nepal a draft framework agreement. Although Kathmandu had already signed a Memorandum of Understanding on the initiative in May 2017, it did not proceed with further steps.
The stated reason was the financing of the projects: China wanted to give loans, while Nepal wanted to get grants. Unspoken was Kathmandu’s caution to not upset its giant neighbor to the south, India.
Even before Oli visited China in the first week of December, there was uncertainty…