Silk Road Headlines_16th October, 2019

Xi Jinping visits Nepal, brings new roads & tunnels

Xi Jinping visited Nepal from 12 to 13 October, the first Chinese President to do so in 23 years. Countries signed new agreements with a clear focus on BRI-related railways and roads, with Xi calling Nepal a “land-linked country”.

The main project is the ‘Trans-Himalayan connectivity network’, which aims to improve and expand connections between China and Nepal. The project has railway and roadway components. Originally, it was mainly a railway project, dating back to pre-BRI times (also see SRH June 19, 2019).

The proposed railway line runs from Lhasa in China to Kathmandu in Nepal, with possible extensions all the way to the Nepal-India border. Progress has been slow due to the extremely difficult terrain. Work on the Chinese side has begun but there have been many delays, and China expects to complete their part only in 2025.

Work on the Nepali side hasn’t even started. The terrain is the main problem, but Nepal also faces financial difficulties. During Xi’s visit countries merely agreed to another feasibility study to the railway. Perhaps to compensate for the lack of railway-progress, China and Nepal agreed to ambitious plans for new and updated connections by road [New Blueprint for Trans-Himalayan Project in Nepal to Come up During Xi's Visit, Says China]. The existing roads in Nepal are deemed unsafe and cannot be used all-weather and all-year.

The primary proposed road project runs from the Chinese city of Gyirong (aka Kerung) to Kathmandu, with various feeder roads on each side. The project includes an update of the Araniko Highway in Nepal, which runs from the border to Kathmandu. To make the highway usable at all times China has suggested to build a series of tunnels on the Nepali side, cutting straight through the Himalayan mountains.  

Additionally, countries will upgrade their border-transport hubs to facilitate more trade [Nepal, China agree to expedite BRI projects]. In 2018, two-way trade amounted to $300 million. Finally, China and Nepal proposed plans to improve the road network from Kathmandu to the northwest.

Besides infrastructure, China and Nepal agreed to much more. Countries upgraded their relationship to a ‘strategic partnership’, with China promising funding for four key-areas: trade & investment, post-disaster (earthquake) reconstruction, energy, and tourism. For the latter, China will subsidize its airlines to open more direct routes to Nepal.  

China will furthermore assist Nepal with improving its law-enforcement, with China offering training for Nepali officers. Countries will also improve contacts between their border-defence forces, mainly to combat organized crime. On military cooperation, China and Nepal agreed to more military-to-military exchanges, joint personnel training, and “equipment and technology consultation”, which is likely hide-speak for the transfer of Chinese military equipment to Nepal.  

The visit by Xi to Nepal, immediately after his visit to India, indicates a strong desire by China to improve relations with its southern neighbour. China’s primary aims are to reduce Indian influence in Nepal and to build transport links from China through Nepal to the border with India. The current Nepali government is very receptive to China’s advances and relations are likely to improve significantly soon, no matter the practical problems with the railroad, which in all probability will be completed anyway.

By Clingendael