China to give 10 mn yuan annually to Nepal for border development
November 21, 2014, 5:28 am

People clear up a highway covered by heavy snow in Nyalam County, southwest China’s Tibet Autonomous Region, along the China-Nepal border on Feb. 9, 2012 [Xinhua]

Nepal’s Secretary of Federal Affairs and Local Development Somlal Subedi said the two nations will “work together to develop the Himalayas”.

According to a Memorandum of Understanding signed by Purna Chandr Bhattarai, joint secretary of Ministry of Federal Affairs and Local Development and Chinese Ambassador Wu Chuntai, the funds will be spent on “small-scale projects in the areas of health, education and road to improve the livelihood in the northern mountainous region”, said Chinese agency Xinhua.

Because of its strategic position next to India and owing to protests against Chinese rule by exiled Tibetan groups, the region is highly sensitive.

Earlier this year, China announced plans to extend a railway line linking Tibet with the rest of the country to the borders of India and Nepal by 2020.

India and China have competing claims over what India calls Arunachal Pradesh and what China calls South Tibet.

China’s Communist army occupied Tibet in 1950. Nine years later, Tibet’s spiritual leader, the Dalai Lama, fled to India after a failed uprising.

India is also aiming to consolidate its influence with its smaller neighbours like Nepal. Indian Prime Minister Narendra Modi announced a $1 billion credit line for the landlocked nation during his state visit earlier in August. Modi will be visiting Nepal again next week to attend a South Asian Association for Regional Cooperation or SAARC summit.

On Friday, Indian media reports said owing to strong opposition from within the Nepali government as well as opposition parties, the Indian Prime Minister’s public rallies in the country will be canceled.

Nepal’s opposition Maoists have accused India of meddling in Nepal’s internal affairs in the past and are also concerned over a proposed power pact which they say could lock Chinese investment out of the sector.

While India remains the largest foreign direct investor at $441 million as of July 2014 compared with China’s $228 million, the gap is narrowing, according to Nepali figures.

TBP and Agencies