The Second Belt and Road Forum for International Cooperation was held in Beijing, China from April 26 to 27. The forum was attended by 37 world leaders and 500 other representatives from 150 countries. However, the US and India did not take part in the forum.
President Bidya Devi Bhandari participated in the forum on behalf of Nepal at the invitation of Chinese President Xi Jinping. The forum successfully concluded with the issue of a 38-point communique on April 27. The communique stressed the need for beefing up international cooperation and collaboration at sub-regional, regional and global levels through BRI and other collaborative strategies. It also accentuated common prosperity and a sound future for those countries participating in the BRI. That as many as 283 agreements worth over USD 64 billion were signed with various countries is no mean achievement. This shows the growing interest of various countries, including ours, in the BRI.
During the forum, Nepal forcefully presented its views, especially on green and sustainable development, effects of climate change and the need for promoting cooperation among nations for poverty mitigation and economic transformation. The country also grabbed the opportunity to urge the Chinese entrepreneurs to invest in the country as the investment environment is improving in the country with the formulation of investment-friendly laws and policies and political stability being restored with the formation of the majority government led by the Nepal Communist Party. In the past, the Chinese investors would complain that they had to face hassles while investing in the country. Now such a situation does not exist.
The BRI concept was propounded by Chinese President Xi Jinping in 2013. The concept is based on the Silk Road network. The Silk Road started during the Han dynasty in 130 BC. The Silk Road connected China up to the Roman Empire. China was connected to India, Arabia, Greece, Rome and other countries adjoining the sea through the Silk Road. Now the BRI has been participated in by 126 countries and 29 international organisations.
China says that although the BRI was initiated by it, the concept has become global. It covers Asian, African and European countries. The main objective of the BRI is to help poor countries in their development endeavors so that they can overcome backwardness, mitigate poverty, create more jobs, improve health, education and other sectors and bring about economic transformations, among others. In broad terms, integrating the economies of poor countries into the global economy is what the BRI aims at. This integration process would create an open world economy, which can lead to public welfare among the BRI-associated countries. The BRI would also strengthen the comity of nations and enhance friendly relations among them.
The projects under the BRI are criticised by the West, especially the US, allegedly for opaque financing practices, poor governance, disregard for internationally accepted norms and standards and setting debt traps for poor countries. It is alleged that poor countries borrow funds from China but fail to manage the projects economically. It is also criticized for creating adverse conditions for local workers and playing havoc with the environment. Countering such criticism, Chinese President Xi Jinping assured the participants at the forum that all the BRI projects would be guided by market principles, China would introduce well recognized rules and standards to make such projects transparent and a people-oriented approach would be adopted so as to eliminate poverty, create jobs and improve people’s livelihoods.
China’s Ministry of Finance has designed a debt sustainability framework for low-income BRI-associated countries. International financial institutions can use this framework voluntarily. The framework would help the BRI-associated countries to analyse the sustainability of the BRI projects. The framework is thus designed to help the BRI-associated countries to consider the viability of the projects before they accept them so that they may not face debt and other problems later.
The BRI is catching up. Chinese financial institutions have provided over USD 440 billion so far for infrastructure projects under the BRI for execution in various countries. The forum has further energized the concept and encouraged the BRI-associated countries to remain in touch with one another, exchange ideas on development perspectives and go hand in hand towards development and prosperity.
For Nepal, the BRI can open vistas for infrastructure development. The country has a pressing challenge of graduating to the status of developing country by 2022. There is also a challenge of attaining the sustainable development goals by 2030. To meet these and other challenges, the country needs to invest in infrastructure development. But as things stand, the country lacks adequate funds. So, foreign assistance is exquisitely required. Being a member of the BRI, the country can take advantage of the investments made under the BRI by Chinese companies or on the third-party market investment module.
Upon completion of the Trans-Himalayan Multi-Dimensional Connectivity Network and the Nepal-China Cross-Border Railway, it is expected that there will be economic transformation in Nepal because transport is one of the pillars of development. That is why, President Bidya Devi Bhandari raised this issue forcefully during the forum. This agenda of connectivity was also encapsulated in the communique, which goes on to show that China has a positive attitude towards this proposition. Now the government should make efforts at taking advantage of the BRI for the benefit of the country and the people.
Nepal and China also signed the protocol on the Transport and Transit Agreement and several other agreements. With the signing of the protocol, the much-awaited Transport and Transit Agreement has come into force. The agreement was signed in 2016 to call a halt to the country’s over dependence on India.
The agreement gives the country access to the sea through four ports and three dry ports via six entry points: Tatopani, Kerung, Yari, Korala, Kimathanka and Olanchungola. However, the last three entry points are yet to be officially opened. The implementation of the agreement will ensure further enhancement of trade between the country and China and further cement Nepal-China relations in the days to come.
(Former banker, Maharjan has been regularly writing on contemporary issues for this daily since 2000)
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