Nepal reviews China-backed projects amid concerns over delays and influence

Kathmandu: Nepal’s new government has begun reviewing several infrastructure agreements signed with China, amid growing concerns over delays, execution gaps, and broader strategic implications.

According to an analysis by the Institute for Conflict Research and Resolution (ICRR), China’s engagement in Nepal has, in recent years, extended beyond economic cooperation into areas perceived as strategic and political influence. The report highlights instances of diplomatic pressure on issues such as Tibet and Taiwan, alongside concerns about Beijing’s expanding role in Nepal’s internal decision-making.

Many of these agreements were signed during the tenure of former Prime Minister K. P. Sharma Oli, when Nepal deepened ties with China under the Belt and Road Initiative (BRI). These projects were presented as transformative steps toward economic growth and connectivity, but several have since faced setbacks.

Projects under scrutiny

The current government in Kathmandu has launched a comprehensive review to determine why multiple China-linked projects have been stalled, delayed, or halted without clear justification. It has also announced that no new agreements with China will be signed until the review is completed.

Key projects under examination include:

• Budhi Gandaki Hydropower Project: Awarded in 2017 to a Chinese firm, later cancelled, reinstated, and now effectively stalled since 2022.
• Kerung–Kathmandu Railway: Announced around 2016–17, still stuck at the feasibility stage in 2026.
• Trans-Himalayan Connectivity Network: A major BRI initiative that remains largely conceptual.
• Cross-border transmission lines: Proposed between 2018–2020 but yet to take off.
• Rasuwagadhi–Kerung border infrastructure: Only partial progress so far.
• Northern highway connectivity projects: Still incomplete despite years of planning.

Concerns over digital expansion

The report also flags uneven progress in telecom and digital infrastructure projects involving Chinese tech firms like Huawei and ZTE, raising both execution and strategic concerns.

Bigger picture

The review signals a cautious shift in Nepal’s approach toward China-backed initiatives, especially those linked to the Belt and Road Initiative. While the earlier government projected these projects as a pathway to transforming Nepal into a regional connectivity hub, lack of financial clarity and implementation challenges have slowed progress.

The outcome of the review is expected to shape Nepal’s future infrastructure strategy and its engagement with external partners.

With inputs from IANS