China aims to engage in various economic partnerships in Nepal under the Belt and Road Initiative (BRI). Experts at an event in Birgunj on Wednesday emphasized that Nepal must adopt a balanced approach to ensure these partnerships contribute to its prosperity while addressing the interests of neighboring countries like India and China, as well as global powers like the United States.

Speaking at the event, Nepali Congress leader and former Foreign Minister Dr. Prakasharan Mahat highlighted the importance of utilizing grants over loans under the BRI. He stressed that Nepal should prioritize a proposed Rs 100 billion grant from China for BRI-related projects and avoid bilateral loans, suggesting that borrowing should only be from multilateral agencies.

“Nepal, situated between two economic giants—India and China—must align its policies to address their interests while pursuing its own prosperity,” Dr. Mahat said during the interaction organized by the Center for Social Innovation and Foreign Policy.

Participants underscored the need for Nepal to craft a foreign policy that transforms the interests of India and China into opportunities for its development.

Rajkishore Yadav, Chair of the Parliamentary International Relations Committee, called for diplomatic initiative to leverage China's interests for Nepal’s benefit.

He also criticized the lack of consensus within the ruling coalition, particularly between the Nepali Congress and UML, on whether to prioritize grants or loans under the BRI.

Former Secretary Madhuraman Acharya advocated for investing foreign loans in return-oriented projects to boost economic dynamism. However, he cautioned that grants from donor countries often come with conditions, necessitating careful and sensitive utilization of foreign funds.

Executive Chairman of the Center, Bijayakanta Karna, highlighted challenges in Nepal-China relations under the BRI framework. He noted a decline in Chinese development assistance since 2013, with over Rs 100 billion in committed aid still undelivered. This includes Rs 56 billion pledged during Chinese President Xi Jinping’s 2019 visit and Rs 15 billion promised during the foreign minister’s 2022 visit.

“China has restructured its engagement in Nepal under the BRI framework. However, concerns over sovereignty and growing public suspicion regarding Chinese influence pose significant challenges to bilateral cooperation,” Karna said.

Anil Agrawal, President of the Birgunj Chamber of Commerce and Industry, criticized Nepal’s inability to benefit from the economic growth of its powerful neighbors, China and India. He urged Nepal’s leadership to formulate a pragmatic foreign policy that leverages these opportunities for national prosperity.