Nepal and China Sign New Belt and Road Cooperation Agreement
Nepal and China Sign New Belt and Road Cooperation Agreement
On December 4, Nepal and China signed a new "Framework for Belt and Road Cooperation" during Prime Minister KP Sharma Oli's visit to China. The agreement, formalized in Beijing, replaces "grant financing" with "aid financing," offering more flexibility in terms of assistance. This change came after China rejected Nepal's proposal to fund Belt and Road Initiative (BRI) projects solely through grants, without loans.
The agreement was signed by foreign secretaries of both countries, following informal discussions to reach a compromise. Prime Minister Oli expressed his satisfaction with the bilateral talks with Chinese leaders, including Premier Li Qiang and President Xi Jinping, stating that the cooperation will strengthen Nepal-China economic ties.
Despite the agreement, some discussions remain unresolved. The Nepali Congress opposed taking loans under the BRI, leading to a list of projects intended for grant financing. Although no MoUs were signed during Oli's meeting with Premier Li Qiang, further talks were held between Nepali Foreign Minister Arzu Rana and Chinese officials. China proposed funding some BRI projects through loans, but Nepal has not made a decision.
A joint statement from both countries expressed willingness to sign the MoU for the Trans-Himalayan Multi-Dimensional Connectivity Network and the Belt and Road Cooperation framework soon.
Doubts Revealed
Belt and Road
The Belt and Road Initiative (BRI) is a global development strategy by China to improve trade and economic growth by building infrastructure like roads and railways in different countries.
Framework for Belt and Road Cooperation
This is a new agreement between Nepal and China to work together on projects under the Belt and Road Initiative, focusing on how they will finance and manage these projects.
Grant financing
Grant financing means giving money to a country or project without expecting it to be paid back. It's like a gift to help with development.
Aid financing
Aid financing is a type of financial help that can be more flexible than grants. It might include loans or other forms of support that need to be repaid under certain conditions.
KP Sharma Oli
KP Sharma Oli is a political leader in Nepal who has served as the Prime Minister. He plays a key role in making decisions about Nepal's relationships with other countries.
BRI projects
BRI projects are development projects under the Belt and Road Initiative, which aim to improve infrastructure like roads, bridges, and railways to boost trade and economic growth.
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