NEW DELHI: “The Nepalese often say, “Drop by drop is the water pot filled.” There is also a Chinese saying: “The flame runs high when everyone adds wood to the fire.” I am convinced that as long as our two countries carry forward our tradition of friendship and keep increasing our exchanges and cooperation, we will together take our friendship across the Himalayas to a new height.”
–Chinese president Xi Jinping in a signed piece that appeared in Nepalese newspapers on the eve of his visit to the Himalayan nation in October 2019.
That visit made Xi Jinping the first Chinese president to visit Nepal in 23 years, marking an important chapter in the ever-tightening embrace between Beijing and Kathmandu. And much as President Xi tried to make it appear an equal partnership, the truth is that China with its huge investments is tightening its vice-like grip on a strategically located but impoverished nation.
With Nepal a vital element of its ambitious Belt and Road Initiative (BRI) which the land-locked Himalayan nation has joined in its quest to reduce dependence on India for connectivity, China is executing infrastructure projects at a furious pace there. This has not only led to Indian anxieties on Nepal’s growing tilt towards China but also fears that it may fall prey to China’s “debt trap diplomacy”, like many other nations.
However, even as the Nepal-China clinch grows stronger, there’s been trouble in this evolving relationship with many Chinese infrastructure projects facing problems. These range from tardy progress, poor work execution, funding issues and difficulties in land acquisition to accusations of Chinese citizens being involved in cybercrimes. And with the outbreak of COVID-19, China’s task has become all the more tough when it comes to executing certain projects in Nepal as technical personnel who had gone home to celebrate the Chinese New Year haven’t returned, sources told StratNews Global. But there are troubles other than the COVID-19.
For instance, the three airport projects in which China is involved—Tribhuvan international airport runway renovation, Pokhara international airport and the new Gautam Buddha airport in Bhairawa near Lumbini (birth place of Lord Buddha)—have been facing delays due to strikes and disturbances by workers.
The Pokhara Regional International Airport is being constructed by the China CMAC Engineering company which bagged the contract in 2014. The airport near Lumbini is being built by China’s Northwest Civil Aviation Construction Group with the Asian Development bank having provided $70 million.
Chinese projects in the roadways sector too are encountering difficulties such as differences over the funding formalities as well as cost overruns, said sources. Among the road construction/upgradation/expansion projects being undertaken with Chinese assistance are the Keyrong-Kathmandu road, the Kodari highway, the Kimanthaka-Jogbani road and the Kathmandu ring road.
The story appears to be the same in the railways sector with issues of funding or the lack of a time frame dodging some projects. The proposed trans-Himalayan railway project to link China and Nepal via a track running from Keyrong in Tibet to Kathmandu is facing its own issues despite the fanfare with which it was announced. With India keeping a watchful eye on this proposed project, sources told StratNews: “It’s progressing in fits and starts as China has agreed to pay for a detailed project report (DPR) for only 75 kilometres of the railway track. There is still lack of clarity on the entire project’s funding once the DPR is ready.”
The proposal to build the Kathmandu-Pokhara and Pokhara-Lumbini rail links with Chinese help, too, remains nebulous with neither the funding nor the time frame for the execution of these projects having been finalised so far. However, work is on to prepare the DPRs to build the Ring Road monorail in Kathmandu.
Significant Chinese inroads into the hydropower (HP) sector notwithstanding—it has already executed five projects in Nepal—the ones currently being built by it have run into rough weather. The projects have been hit by delays in submission of feasibility reports, poor execution of projects by Chinese contractors, blacklisting of some companies for poor performance, natural disasters like the 2015 earthquake, floods and landslides and slow pace of land acquisition.
Among the Chinese executed HP projects dodged by trouble include the 756 MW Tamor project, the 111 MW Rasuwagadhi hydroelectric project, the 37 MW Upper Trishuli 3B project, 1,200 MW Budhi Gandaki project and the 1,000 MW Kimathanka Lower Arun Hydropower project.
In the past, the Chinese have built in Nepal five hydropower projects—the 50 MW Upper Marshyangdi A, 456 MW Upper Tamakoshi, 25 MW Upper Madi, 30 MW Chameliya and 60 MW Upper Trishuli.
The Chinese footprint has also been increasing in Nepal’s electricity sector. China is helping Nepal set up electricity transmission lines, though here again Beijing and Kathmandu have had their share of troubles. For instance, the contract given to the Chinese to build electricity sub-stations in Matatirtha-Kathmandu-Markichok and Tanahu in Gandaki was terminated by the Nepal government for lack of adequate progress. These projects are now being funded by the Nepalese and Norwegian governments as well as the ADB.
China is also making its presence felt in the telecom sector in Nepal, with Kathmandu keen to reduce the country’s dependence on India which once enjoyed a monopoly. In December last year, the Nepal Telecom Corporation asked Chinese telecom companies to install 4G equipment in telecom towers. Nepal’s Chaudhary group has gone ahead with a tie-up with controversial Chinese telecom major Huawei for a 4G network that can be upgraded to 5G.
But Chinese presence in the telecom sector has come with its share of problems for Nepal. “There have been concerns about Chinese nationals’ involvement in cyber crimes and financial frauds,” said sources.
At least 122 Chinese nationals were arrested last December in Kathmandu and deported early January for alleged involvement in cyber crimes and other criminal activities such as hacking ATM machines.
Nepal has also been getting Chinese assistance in constructing land ports with the latter assisting with the Timure dry port in Rasuwa district. It’s also seeking Chinese help for other dry ports but these new projects are facing delays as Beijing wants a joint security plan in place before proceeding with the work.
China’s rapid strides across all spheres of economic activity in Nepal have also seen it expressing interest in constructing the Nepal-China Friendship Industrial Park in Damak. However, even as an inception report is being prepared as a run-up to the DPR, concerns are already being voiced about the land that will be required, which in turn will lead to the displacement of a large number of people.
Nepal’s industries sector hasn’t been spared the Chinese onslaught either with the setting up of the Nepal Hongshi Shivam Cement project. But this project too is facing turbulence with the employees complaining about low salaries. Lack of access via proper roads and the need for high intensity power supply have also bedevilled this project.
The setbacks in various projects notwithstanding, Beijing has not been deterred from pushing ahead with its efforts to wield greater influence in Nepal. So it’s willing to open its purse strings to provide a grant of Nepalese Rs 500 million as a development grant to each of the 126 rural municipalities in the 15 districts that have a border with the Tibetan Autonomous Region (TAR) to develop infrastructure.
But this offer comes with strings attached. Seeking to make the most of its offer, Beijing wants Kathmandu to agree to the use of only Chinese contractors, manpower and materials for the project.
It isn’t only infrastructure though in which China has spread its tentacles far and wide in Nepal. It’s also seeking to make inroads in what an Indian diplomat described as “Nepal’s social infrastructure.” So Beijing stepped in to help reconstruct the Durbar high school in Kathmandu and the Ratna Rajya secondary school in Sindhupalchowk, both of which were destroyed in the 2015 earthquake.
With China also seeking to appropriate Buddhism, it’s already poured millions of dollars into Lumbini. Apart from the international airport China is building not too far from Lord Buddha’s birth place, it also plans to build a Buddhist temple which will be in addition to the Zhong Hua Chinese Buddhist monastery.
China is prepared for the long haul and India is fast losing influence in a country with which it has had long historical, cultural and economic ties. It can only wait and watch, with its fingers crossed.
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