Nepal PM Oli defends BRI agreement with China, rules out any loan agreement

Kathmandu [Nepal], December 5 : Nepali Prime Minister KP Sharma Oli reiterated that no loan agreement has been made with northern neighbour China while signing the revised Belt and Road Initiative (BRI) pact.
Speaking to journalists after arrival at Tribhuvan International Airport on Thursday after completing his four-day visit to China, Oli reiterated that no loan agreements have been made with Beijing.
"This time we discussed about various projects under the BRI. We will hold separate discussions and consultations as well as agreements about those projects relating to its plan of implementation. What we are getting now (from China) is not a loan, I hope I will not need to clarify it and repeat it further," he said.
PM Oli further said that the pact is not about a loan and there have been no talks about any loan agreement. "We have been reiterating that no loans are being taken from various fronts but also it hasn't settled down," the Prime Minister said.
He added that discussions on implementing nine projects under the Belt and Road Initiative would take place separately in the future.
"Every project under the BRI will be discussed separately between the two countries during implementation," Oli said.
Notably, the agreement signed on Wednesday between the two countries formally got inked after the term "aid financing" was replaced with "grant financing." While a grant refers to a subsidy, aid can encompass both grants and loans, offering more flexibility in the terms of assistance.
The shift in language came after China rejected Nepal's proposal that the projects under the Belt and Road Initiative (BRI) should be funded by China and that Nepal would not take loans under the BRI.
But the Nepali Prime Minister has been defending the agreement signed on Wednesday (December 4) not to be a loan agreement between the two countries.
Before the formal signing, Nepal had sent the draft of the framework ahead of Oli's departure for Beijing on Monday. In response, the Nepalese and Chinese officials held informal discussions on Tuesday to find a middle ground.
China subsequently removed the term "grant financing" from the draft framework proposed by Nepal, replacing it with the more general term "financing." Amidst the ongoing discussions, the Nepali Congress's stance against taking loans under the BRI led the Nepali government to prepare a list of projects intended solely for grant financing.
The MoUs could not be signed during a meeting between Prime Minister KP Oli and Chinese Premier Li Qiang.
However, Nepali Foreign Minister Arzu Rana later met with representatives from the Chinese Foreign Ministry. During these talks, the Chinese side proposed that some BRI projects be funded through loans, but no decision was made by Nepal.
According to an official from the Nepali delegation, there was further internal discussion on various options. One of the key points was whether to replace "grant" with "aid," which was ultimately agreed upon.
It may be noted that the joint statement released by Nepal and China late on Tuesday indicated that "both sides have shown their willingness to sign the MoU on establishing the Trans-Himalayan Multi-Dimensional Connectivity Network (THMDCN) and the framework for Belt and Road Cooperation between the two governments at the earliest opportunity".