Nepal Shifts BRI Strategy: Opts For Grants Over Loans

Nepal has decided to forgo loans for projects under China's Belt and Road Initiative, instead opting for grants based on mutual agreements. The decision comes amidst concerns over the debt-trap potential of BRI projects, following discussions during Foreign Minister Arzu Rana Deuba's recent trip to China.

Nepal has declared its intention to rely on grants rather than loans for projects under the Belt and Road Initiative (BRI), a massive infrastructure scheme led by China. The decision comes after Foreign Minister Arzu Rana Deuba's visit to China, during which Nepal articulated its plan for future BRI endeavours.

The stance marks a pivotal point for Nepal, which initially signed the BRI framework in 2017 but has been deliberating on execution details. Minister Deuba, addressing journalists at Tribhuvan International Airport, emphasized that any projects would proceed based on mutual agreements and understanding involving relevant stakeholders.

Highlighting concerns surrounding BRI, especially after Sri Lanka's debt-for-lease situation with the Hambantota port, Minister Deuba stressed Nepal's approach to BRI through grants. Talks with Chinese Foreign Minister Wang Yi also focused on trade, connectivity, and tourism, ahead of the 70th anniversary of diplomatic relations and 'Visit Nepal Year' in 2025.

(With inputs from agencies.)