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New Debt Trap Victim on the Block: Nepal

Kagat Ki Rail to Nowhere

Theatrics of Xi Jinping, since he crowned himself his “Unlimited Edition in 2017, knows no bounds.

With “higher than the mountains, deeper than the ocean, stronger than steel and sweeter than honey” ties with Pakistan, comes this one from Chinese President Xi Jinping’s visit to Nepal in 2019, that China and Nepal were “close as lips and teeth”.

Pakistan has been all, but buried in its CPEC debt trap, as we have witnessed in the last two years of Pakistani economic woes.

In a similar manner, the proposed BRI railway, that will link Kerung city in southern Tibet to Nepal’s capital Kathmandu, entering the country in Rasuwa district and eventually going on to India.

This link shall bury Nepal deep in Chinese debt, from where it shall be all but impossible to stick the Nepali neck out.

Delusion in hiding the Six Extremes

Fallacy of Game Changer Railway

A Chinese study, that has not been made public despite intense debate over what’s happening, lists

   “Six extremes”: including Topography, Weather, Hydrology, Cost and Tectonics that will make the project hugely economically disastrous, if not viable.



 About 98% of the railway on the Nepal side will be in tunnels and on bridges according to the report, with about five stopovers. Tracks will need to be built on steep terrain, as the railway climbs from an altitude of 1,400 metres in Kathmandu to about 4,000 metres in Tibet.


 The proposed route also cuts through the mountains near a major fault line, where the Indian plate meets the Eurasian plate to form the Himalayas, hence renders the area highly susceptible to earthquakes.

Mitigating these risks makes the project cost far more than normal railways, and if one includes the cost of maintenance, one will not consider it, even for a dire situation connectivity to, say NewYork, figuratively considering.

Economics Just Don’t Add Up, Mr Oli

Costs of the railway from Kerung to Kathmandu at about 38 billion yuan (USD$5.5 billion), is equal to Nepal’s total revenue in 2019.

The railway would be 800 kilometres long from Tibet to Kathmandu. Although only one-third of the total length falls on the Nepal side, it would have to pay up half of the costs, not due to the extreme geology but more importantly, that’s the way Chinese Projects work.

Even if we get oblivious to Debt Trap, this connectivity will cause a fourfold increase in the trading distance from before. The distance between Birgunj and Tianjin (the closest seaport of China) or Shanghai is minimum 3,300 km and the distance between Birgunj and Kolkata is around 750 km. Henceforth, traders will only be attracted “towards trade through China only if Indian border is not available.

What is most baffling for the locals, is the fact that, most of the rail link shall be in tunnels or over bridges, with only five stations. And this is the biggest fact which Oli hides from Nepal, is that it shall not be along the national highway and not touching the important economic towns along the highway.

What use is it for Nepal, if it does not touch the major towns and economic centres.




Is it only to ferry troops to Nepal Border? Is China planning to establish Military bases in Nepal? Oli and his communist party fails to reveal about the same.

Corruption already begun?

How is Oli related to the tainted Kalika Constructions?

The Commission for Investigation of Abuse of Authority on Friday filed a corruption case at the Special Court against former minister Bikram Pandey, chairman of the Kalika Construction, for substandard construction and repeated collapses of the main canal of the Sikta Irrigation Project, one of the few projects Oli had signed up with Xi Jinping.

With Indian provided proof, a corruption case at the Special Court indicted Oli’s close politician, the former minister Bikram Pandey, chairman of the Kalika Construction, for substandard construction and repeated collapses of the main canal of the Sikta Irrigation Project.

Along with Pandey, 20 others including government officials and consultants involved in the multi-billion-rupee irrigation project have been charged with corruption.

It is a revelation that, on the BRI front, Kalika has partnered a number of Chinese companies, including Ranken Railway Construction and China Railway Construction.

It has also worked with partners like the Asian Development Bank which is the biggest loan laundering Bank resulting in Hambantota takeover by China, the one no one in the developed world does business with.

Two Hundred Mandarin lăoshī (teachers) in Nepal

Why the Mandarinization of Nepal?

With advent of CPEC, by 2015, there were approximately 300 mandarin teaching facilities, initiated by Pakistan at behest of Chinese. Against Nawaz Sharif’s views on it, Pakistan Army fostered and argued, that it shall result in integration of economic infrastructure of Pakistan with Chinese investment.

Five years on, there is no hint of the economic upturn to the economic woes of Pakistan industry. All which is seen, is that Chinese movement of goods has become easier and facilitating by the Mandarin-speaking Pakistani Drivers. However, imposition of language gives a sense of ascendency over the local citizens. It has been established in Pakistan, for example, the availability of Pakistani brides, a-galore in Chinese markets.

Is that what China intends to achieve, to obliterate thousands of years of Nepali culture and language, with mandarin? Does it intends to import Nepalis, just as a workforce? Highly Likely.


Creating Artificial Disputes with India

China’s Belt and Road Initiative (BRI) has many questions being raised, on China’s motivations for the initiative, and whether Beijing can afford the US$ 3 trillion it has committed to infrastructure projects and its partners can afford the debt they are taking on. Some rightly fear BRI could be a Trojan horse for economic colonization, through debt traps.

Sri Lanka is often cited as a cautionary tale. Unable to repay the loans on a US$1.5 billion port construction project, the Sri Lankan government agreed to give China a 99-year lease on the port instead.

Also, Economists worry that like Laos example, which has seen its debt reach 68% of GDP, will have difficulty paying off its share of a US$6 billion rail line being built by China. As also in the Maldives, the country is facing a looming debt trap, with US$92 million in annual payments due to China to pay off an airport upgrade and bridge project, roughly 10% of the entire budget.

 This way, Nepal shall be in bigger trouble than any other country, which has been Debt Trapped by China.


On the contrary, all these years of relationship with Nepal, India has been never condescending but treated it as an equal partner, where Nepal’s start-ups are being fostered like the Yatri Electric Motorcycles, which incidentally was dismissed by the Chinese as a competitor.

Nepal is forced in seeking a grant from China to construct the railway, but China has remained reticent. The Nepal government did not allocate any money for the northern railways in its budget. But according to officials at Nepal’s infrastructure and transport ministry, a detailed study for the Kerung-Kathmandu railway will cost an estimated US$313 million, five times the country’s total rail budget.

Inside sources tell us, cost of this railway are given as a loan, in exchange of assurance to keep up the fight with India on behalf of China, closer functioning of Nepal Communists (The Nepal Communist Party with Chinese Communist Party of China (CPC)), keeping wraps on the corruption-tainted infrastructure tie-ups with China as part of BRI and further Han Chinese and Mandarin language and culture in Nepal.

Nonetheless, focussing on the BRI link, traders will only be attracted “towards trade through China only if Indian border is not available. Is that what China shall orchestrate? That Nepal is kept engrossed in artificially generated disputes with India.

That is what Oli has achieved, by refusing Indian offer for talks on Lipulekh, and going ahead with Creating an Artificial Dispute with India, while backstabbing every common man Nepali.

21 June 20/Sunday                                                               Written By: Fayaz

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