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Implications of Nepal-China road connectivity deal

Published: 21st Oct, 2019

Implications of Nepal-China road connectivity deal

Recently, Nepal and China ink road connectivity deal when Chinese President Xi Jinping visited China.


Recently, Nepal and China ink road connectivity deal when Chinese President Xi Jinping visited China.


  • Nepal and China have decided to construct rail link connecting the Tibetan capital Lhasa to Nepal’s capital Kathmandu
  • A 28-km Kerung-Kathmandu road tunnel is also proposed to cut the distance short between Kathmandu and Chinese border.
  • President Xi promised Upgradation of the Arniko highway that links Kathmandu with Tatopani transit point which was badly damaged in 2015 earthquake.
  • Assistance to the tune of 56 billion (Nepalese) rupees over the next two years to help Nepal’s development programmes.
  • Nepal and China has also signed around 20 deals covering water supply, trade, traditional medicines. 
  • China wants to support Nepal in realizing its dream to become a land-linked country from the landlocked country.

Concerns for India

  • Nepal is a wedged between China and India. So being a landlocked nation, Nepal is trying to diversify its relations and less dependence on India.
  • For Nepal, China serves as a potential supplier of goods and assistance that it badly needs in order to recover its economy. Indian companies in Nepal will face stiff competition from Chinese companies.
  • The Madhesi agitation in 2015 had forced Nepal to explore trade links with China and reduce its long term dependence on India.
  • Lastly, another factor to increase the interest is China card which most of the south Asian countries are playing with India to gain the mileage in negotiations & counter India’s Big Brother approach.

Why China can’t replace India in Nepal?

  • Geographical Advantage: India has an advantage of geography on its side. Chinese rail and port connectivity projects are not very feasible owing to the difficult terrain.
  • Indian Ports are cost-effective than Chinese: The nearest Chinese ports will be over 3000 km away while Kolkata and Visakhapatnam ports which Nepal currently uses are relatively closer.
  • Cultural Connections: India and Nepal has deep linguistic & cultural and religious affinity, whose trade or economic ties with China alone cannot entirely takeover.

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