Disagreements on financing modality among major ruling parties for Belt and Road Initiative (BRI)-related projects have fueled uncertainty over agreement to implement such projects during Prime Minister KP Sharma Oli’s upcoming visit to China.
The prime minister is set to fly to the northern neighbour on Monday, December 2.
While Nepali Congress has maintained a firm stance against taking loans under the BRI, the opposition parties, including the CPN (Maoist Centre) and CPN (Unified Socialist), have advocated for advancing the agreement.
At a consultation on Monday, November 25, with former prime ministers, foreign ministers, and senior officials at Singha Durbar, differing opinions on the BRI emerged.
Prime Minister Oli said that no loan agreement would be signed during the visit, according to RSS, the state-owned news agency.
"If necessary, we can seek loans or grants from any country or agency based on national interest,” RSS quoted Oli as saying. “We must not fall prey to unfounded fears of a debt trap.”
While Nepali Congress President and former Prime Minister Sher Bahadur Deuba was not present during the discussion at Singh durbar, he reiterated the party’s stance – Nepal should accept grants but avoid loans – at a programme in Janakpur.
“Nepal cannot afford loans,” said Deuba. “We are ready to accept grants.”
However, leaders of the opposition parties such as former prime ministers Madhav Kumar Nepal and Jhalanath Khanal and former Foreign Minister Narayan Kaji Shrestha advised Oli to move forward the implementation agreement.
“The BRI initiative aligns with Nepal’s interests,” said Nepal. “A country like ours should benefit from such projects.”
Shrestha added: “While the agreement should allow flexibility for grants or concessional loans, outright rejection of loans would limit our opportunities.”
Former Foreign Minister Dr Prakash Chandra Lohani underscored Nepal’s sovereign right to make decisions, suggesting the prime minister to uphold national interests during his visit. “Nepal must maintain credibility in its engagements with global powers," Lohani added.
The visit will prioritise implementing past agreements, expanding transmission lines, promoting exports to China, and exploring new avenues for bilateral cooperation, according to Oli.
Despite the Nepali Congress’ reservations, a majority of leaders from other political parties have expressed support for advancing BRI projects, keeping options for grants and concessional loans open.
