China boosts hopes Nepal rail link can get back on track

Foreign Minister Wang Yi tells Nepalese counterpart Narayan Khadka that surveyors will examine the feasibility of plans to link Kathmandu with Gyirong in Tibet
Talks on the project began in 2016, months after a blockade on the Indian border boosted efforts to strengthen ties with Beijing

Belt and Road Initiative

Cyril Ip

Published: 8:00pm, 11 Aug 2022

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China will launch a study into plans for a cross-border railway with Nepal after the Covid-19 pandemic and a change of government in Kathmandu left the project’s future uncertain.

In a meeting with his Nepalese counterpart Narayan Khadka in Shandong province on Wednesday, Chinese Foreign Minister Wang Yi announced that surveyors would be sent to Nepal to examine the feasibility of a line linking Kathmandu and the southern Tibetan city of Gyirong.

Discussions about the rail link began in 2016, months after a prolonged blockade of the border with India amid inter-ethnic tensions and a row over a new constitution disrupted vital supplies of fuel, medicine and commodities.

India denied accusations from some Nepalese politicians that it was behind the blockade, but the incident highlighted Nepal’s dependence on its southern neighbour and prompted the government to seek closer relations with China.

The two sides then signed an agreement to cooperate on a possible rail link under Beijing’s signature Belt and Road Initiative in 2018, but there are long-standing concerns about the cost and technical difficulty of building the line and little concrete progress has been made since then.

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“No matter the changes to the international and regional situations, China and Nepal have always firmly supported each other on issues concerning our core interests, and have always stood side by side in the face of challenges,” Wang said.

He also reiterated Chinese President Xi Jinping’s pledge to boost transport links which he made during a historic visit to the country in 2019.

He added that China would support Nepal’s “revitalisation”, work on a development plan that fits its national interests, and the improvement of its people’s livelihoods.

According to Nepal’s embassy in Beijing, Wang also announced that Beijing would provide 800 million yuan (US$119 million) to Nepal this year, and reassured Khadka that it would soon begin construction of the second phase of a project to improve the ring road in Kathmandu, which has been delayed almost four years due to labour disputes and technical difficulties.

Some smaller Beijing-assisted projects in the Himalayan nation have also been put back as a result of Covid-19 and internal political instability.

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In May 2021, former prime minister KP Sharma Oli, who pushed for closer ties with China and signed various deals to boost economic and transport links, was removed from power after losing a parliamentary vote of confidence and replaced by Sher Bahadur Deuba, who is seen as more pro-Western.

In February Deuba rejected calls from China to reject a US$500 million grant from Washington, but in June he turned down a proposal from Washington to form a security partnership.

“The two foreign ministers expressed their commitment for the timely implementation of the agreements signed and understandings reached during high-level visits in the past. They agreed to expedite the implementation of China-assisted projects in Nepal,” a statement from Nepal’s embassy in Beijing said.

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The two foreign ministers also agreed to promote further cooperation in areas such as trade, health, tourism, agriculture and poverty alleviation.

Beijing also promised to provide an additional 3 million yuan worth of disaster relief materials and 2 million yuan worth of medical resources to Nepal.