Nepal PM leaves for US for attend UNGA session, will fly to China on Sept 21

While in New York, Prachanda is also scheduled to address the United Nations Sustainable Development Goals Summit among others, on the sidelines of the UNGA.

PM Prachanda will fly to Beijing on September 21 on a four-day official trip, four and a half months after his visit to Delhi.

The reason for China’s “trust deficit” towards the Nepal government is being said to be the Millennium Challenge Corporation Nepal Compact, the $500 million grant from the US to build power and road infrastructure projects, which was endorsed by the Nepal Parliament on February 27 last year with the active support of the Nepali Congress and Prachanda-led Maoist Center, overruling China’s objections.

The MCC Nepal compact entered the execution phase last month, setting a five-year target to complete 315-km 400 KV transmission project .

The MCC endorsement is not the only setback that China-Nepal diplomacy has suffered recently. Nepal has shown clear reluctance to have Chinese projects under the Belt and Road Initiative (BRI), something it signed six years ago to invite China for execution.

PM Prachanda clearly indicated that he would rather want China to execute projects under the grant than follow the normal practice of taking soft loans under BRI.

As per available indications, China’s mega railway project passing through the Himalayas and connecting Tibet with Nepal may take a back seat, especially in the context of Nepal seeking grants and avoiding the loan.

Prachanda is scheduled to meet president Xi Jinping and Prime Minister Li Qiang during his stay there. “Our challenge lies in convincing China that we are committed to our friendship with our neighbours and that the MCC is only a developmental project with no strategic or security significance,” a senior diplomat involved in finalising the agenda told The Sunday Express.

The PM’s office said Nepal will seek China’s help in developing a couple of hydro projects and roads connecting the two sides apart from seeking a waiver of 215 million dollar loan it borrowed while constructing the Pokhara International Airport that has remained dysfunctional after its formal inauguration nine months ago.