Nepali Prime Minister Pushpa Kamal Dahal (front center) attends the Nepal-China investment and business forum 2023 in Kathmandu, Nepal on March 14, 2023. (PHOTO / XINHUA)
New Delhi — Nepal is aiming at strengthening trade and investment cooperation with China to help the mountainous country achieve its development objectives, according to Nepali Prime Minister Pushpa Kamal Dahal.
Speaking at the Nepal-China Investment and Business Forum 2023 in capital city Kathmandu on March 14, Dahal pointed out that China remains Nepal's second largest trading partner and the largest source of foreign direct investment.
Dahal said he believes that China's economic progress would open up wider opportunities for Nepal, and relevant exports and investments would help his country grow and prosper.
“We count on the Chinese investments in filling our financial and technological gaps,” the prime minister said.
Nepal traditionally relied on India for economic assistance and trade, but is now increasingly looking toward Beijing and diversifying channels to secure more investments for various development projects, signing more trade and transit deals
“We are ready to facilitate the Chinese companies interested in investing in Nepal,” he added, citing such areas of investment as hydropower, manufacturing, infrastructure development, tourism, agriculture and mining and minerals.
Nepal traditionally relied on India for economic assistance and trade, but is now increasingly looking toward Beijing and diversifying channels to secure more investments for various development projects, signing more trade and transit deals.
While striving for deeper economic links, Nepal would like to minimize its trade deficit with China, he said, calling on Beijing to provide easy and more generous market access to products from the Himalayan country.
"Nepal's growing trade deficit with China and the apparent gaps in commitment and actual investment of FDI (foreign direct investment) from China" are some of the issues that need a practical solution, Dahal said, according to a statement issued by the Confederation of Nepalese Industries, or CNI, which organized the forum in partnership with the China Council for the Promotion of International Trade.
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Nepal's imports from China fell to $1.84 billion in 2022 from $2.38 billion a year ago, while exports totaled $5.39 million, down from $8.37 million in 2021, official data showed.
According to Nepali data, Chinese investors committed $195.74 million in FDI to Nepal during the first six months of the Himalayan nation’s 2021-22 fiscal year ending July 15.
Dahal said Nepal has made significant reforms to improve its investment climate. “We are seriously working on simplifying other procedures and fully operationalizing the one-stop service for investors. Necessary rules are being developed for the automatic approval of the FDI,” he said.
According to Nepali data, Chinese investors committed $195.74 million in foreign direct investment (FDI) to Nepal during the first six months of the Himalayan nation’s 2021-22 fiscal year ending July 15
Zhang Shaogang, vice-chairman of the China Council for the Promotion of International Trade, said Chinese enterprises are the main players in Nepali projects.
“In the past five years until 2022, China has signed project contracts worth $10.74 billion in Nepal,” said Zhang. “There are many attractive products in Nepal, but their visibility is yet to be enhanced among the Chinese consumers.”
“We should further enhance the areas of investment cooperation as Nepal has a huge demand for infrastructure development and investments in a wide range of areas, such as power stations, communications, road construction, clean energy and information technology,” said Zhang, according to the CNI statement.
China’s ambassador to Nepal, Chen Song, said Chinese investments in Nepal have increased, creating more than 100,000 jobs.
“China will continue to help Nepal in the development of infrastructure and human resources,” said Chen. “We encourage Chinese enterprises to invest and do business in Nepal.”
Chairman of Nepal's National Assembly Ganesh Prasad Timilsina (first right) and Chinese Ambassador to Nepal Chen Song (second right) write Chinese calligraphy at a Chinese New Year reception hosted by the Chinese embassy in Kathmandu, Nepal, Jan 19, 2023. (PHOTO / XINHUA)
China will continue to help Nepal in the development of infrastructure and human resources … We encourage Chinese enterprises to invest and do business in Nepal.
Chen Song, China's ambassador to Nepal
CNI President Bishnu Prasad Agrawal said forums such as the one organized on March 14 by his industry association would play an important role in identifying and addressing problems faced by the entrepreneurs of the two countries, as well as in charting out the future course of action.
The March 14 forum conveyed the message that Kathmandu is in need of development and looking for more Chinese investment and trade, Shekhar Golchha, vice-president of the Federation of the Nepalese Chamber of Commerce and Industry, told China Daily, but Nepal does not show any favoritism to get investment.
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Alka Acharya, a professor at the Centre for East Asian Studies at Jawaharlal Nehru University's School of International Studies, New Delhi, said Nepal may have faced some hindrances or delays in getting funding or investments from India, adding that China is handling the situation in a practical and efficient way.
With the Belt and Road Initiative, a new set of issues have emerged, she said.
China’s exchanges with Nepal have grown since Nepal joined the BRI project, said Sukh Deo Muni, a former diplomat and professor emeritus at JNU’s School of International Studies.
The writer is a freelance journalist for China Daily.