On September 1, a meeting of various government agencies held at the prime minister’s residence in Baluwatar entrusted the National Planning Commission Vice Chairman Min Bahadur Shrestha with coordinating with various government entities and finalising a draft plan on implementing Belt and Road Initiative (BRI) projects. The Shrestha-led committee is quietly laying the ground for the execution of BRI projects.

Based on the decision made by top officials in the presence of Prime Minister Pushpa Kamal Dahal, Foreign Secretary Bharat Raj Paudyal wrote to Shrestha on September 3 sending along the draft of the BRI implementation plan, which was forwarded by the Chinese side and has already gone through several revisions based on understanding between officials of the two countries. Paudyal’s letter asked Shrestha to coordinate and liaise with various government agencies and give final shape to the BRI implementation plan.

But senior officials at the National Planning Commission, Prime Minister's Office, Ministry of Finance, and Foreign Ministry who worked on the draft document told the Post that they are scrambling to reach a common position on the plan, based on which Nepal plans to sign project agreements during the prime minister’s upcoming China visit starting September 22.

The Cabinet plans to sit on Friday as the prime minister is leaving for New York on Saturday, a secretary at the prime minister’s office said. If Friday’s Cabinet meeting does not approve the draft BRI implementation plan, Nepal will not be able to present it to Chinese officials during the prime minister’s visit and no agreements can be forged on BRI-related projects during the visit.

The BRI implementation plan is considered a key for the execution of BRI-related projects in Nepal. The plan also talks about how the two sides will jointly build BRI projects in Nepal, either with grants, loans, or other financial arrangements. The draft plan has also identified areas of cooperation under the BRI framework.

Nepal and China signed the framework agreement on BRI in 2017, but the two sides have failed to reach an agreement on how to implement projects. And there are concerns from various quarters regarding the wording of the implementation plan.

The Chinese side again pushed for signing the BRI implementation plan after Nepali Congress chief Sher Bahadur Deuba became prime minister in July 2021. But the Deuba government was reluctant to sign the plan due to reservations over some of the clauses of the draft plan, according to a former minister who was aware of the development.

Nepal first received the text of the BRI implantation plan from the Chinese side in early 2020. After several rounds of exchange of text and forwarding of comments, the Chinese side in October 2021 sent their draft when Deuba was the prime minister.

The draft titled “Implementation Plan on Jointly Building the Belt and Road Initiative between the Government of the People’s Republic of China and Government of Nepal” is currently under the NPC’s redrafting/processing department. The document’s sub-section number 12 titled ‘Other Areas’ under section 3 named ‘Cooperation Priorities’ mentions, among other things, “the two sides will strengthen legal cooperation and actively carry out diverse legal exchanges and capacity building in order to facilitate B&R cooperation”.

It also says “the two sides will implement relevant agreements on law enforcement cooperation and strengthen security cooperation through joint training, information exchange, and capacity building, including for disaster management”.

“We had signed up to the BRI as a purely developmental project,” a minister in the former Deuba government said. “But when we spotted components related to security and strategic issues in the Chinese draft, we refused to sign it.”

On Monday evening, former prime minister Deuba accompanied by another Congress leader and former foreign minister Narayan Khadka met Prime Minister Dahal and advised him against signing the BRI implementation plan, according to a leader close to the prime minister.

“Due to internal and external financial pressures, we are not in a position to accept loans to execute projects under the BRI. Second, Nepal had already rejected the draft of the BRI implementation plan as the plan is not required to execute the BRI projects. Third, some provisions in the implementation plan are of a strategic nature,” said the leader quoting Deuba and Saud. Prime Minister Dahal told them that he will carefully study the draft.

The Post made several calls and sent messages to NCP vice chairman Shrestha to inquire about the latest developments on the BRI implementation plan, but he did not respond.

In China, the National Development and Reform Commission (NDRC), the NPC’s Chinese counterpart, handles BRI implementation. The NDRC is also known as the State Planning Commission. When Deuba and Oli were prime ministers, the task of finalizing the BRI draft was entrusted to the Ministry of Foreign Affairs, which was supposed to do so after consulting various line ministries.

After Dahal became prime minister, Shrestha visited China in July whereupon the task was now entrusted to the NPC. During his China visit, Shrestha also met with Cong Liang, the vice chairman of the NDRC, and discussed a memorandum of understanding between the NPC and the NDRC, among other issues, according to the National Planning Commission.

“We are not aware of any discussion on the BRI implementation plan at the NPC,” said Diwakar Luitel, an information officer at the commission.

Sources at the prime minister's office told the Post that Prime Minister Dahal and Chief Secretary Baikuntha Aryal, among other officials and leaders, also clearly communicated to Shrestha not to include any provision that even remotely alludes to security and strategy in the proposed plan.

“The draft of the BRI implementation plan is expected to land at Friday’s Cabinet meeting and it will be thoroughly discussed. If there is any objectionable provision, the document will be rejected then and there. So there is still no guarantee that it will be signed during the prime minister’s visit,” a source at the prime minister’s office said.

A senior official at the Foreign Ministry also said he is unsure whether the agreement will be signed during the visit. Currently, the NCP is engaged in a back and forth with the Chinese side and other line ministries to give final touches to the draft plan. The China Desk of the Foreign Ministry, in coordination with other line ministers and various government entities, is working on the draft plan. “But I am not aware whether it will be agreed,” said foreign ministry spokesperson Sewa Lamsal.

“The Chinese side had forwarded the text of the BRI implementation plan around the end of 2019 or early 2020. After receiving the text we had several rounds of consultations with different line ministers,” said former foreign minister Pradeep Gyawali. “After that, we sent back the draft with comments to the Chinese side.”

“We had included feedback and inputs from foreign, finance and other line ministers before sending the draft to the Chinese side for approval. The Chinese had returned the draft with some comments after we left the government,” said Gyawali. Gyawali was the foreign minister in the former KP Oli government that was removed by the Supreme Court’s July 12, 2021 decision.