After failing to receive an invitation to visit India, a customary first port of call for new Nepali prime ministers, Prime Minister KP Oli is mulling going to China, probably in the first week of December.

According to multiple sources at the Prime Minister’s Office and the Ministry of Foreign Affairs, Oli might embark on an official visit to Beijing in the first week of December to avoid harsh winter in China later, and preparations for the visit will begin after the Tihar festival. The proposed date of Oli’s visit is from December 2 to 5, said multiple sources.

Prime Minister Oli also discussed his upcoming visit to China with Foreign Minister Arzu Rana, while Rana also spoke with senior foreign ministry officials on Wednesday.

Rana told the Post that there has been no official confirmation from the Chinese side about the visit, but there is a possibility.

During a meeting in New York with Chinese Foreign Minister Wang Yi, who is also the State Councilor of China, in September-end, Wang had informed the prime minister that they would welcome him in China in the first half of December and the date of the visit would be decided based on a mutual understanding.

According to sources at the Prime Minister’s Office and the Ministry of Foreign Affairs, the visit plan is in an advanced stage, following conversations and communications between Oli, Wang and senior Communist Party of China (CPC) leaders.

Bishnu Rimal, chief political advisor to the prime minister, however, told the Post that the visit is yet to be confirmed. “Nothing has been decided but talks are going on with the Chinese side.”

Sources told the Post that the prime minister himself is in touch with Wang and senior CPC leaders and discussing his upcoming China visit including possible agenda, as well as a list of agreements.

“Nothing has come up at our level,” said Amrit Rai, foreign ministry spokesperson. “We have no idea if something is in the works at the political level.”

The prime minister will meet with Chinese President Xi Jinping and his counterpart Li Qiang, among others, and will spend one night in Chengdu, according to officials.

The major agenda of the visit, according to the multiple officials, is to convert the loan taken for the Pokhara International Airport into a grant, sign the implementation plan for the Belt and Road Initiative, execute some new projects under the BRI framework including at least one mega-infrastructure project immediately, and expedite past accords and agreements.

A joint secretary at the Ministry of Foreign Affairs said that during the visit, Nepal will ask for a waiver of the loan taken from Exim Bank of China for the construction of the Pokhara International Airport.

Nepal has borrowed 1,378.74 million yuan (around Rs25.88 billion) from the China Exim Bank for the airport’s construction.

The government had previously requested the Chinese side to waive the loan, as Pokhara airport is struggling to generate sufficient revenue due to a failure to conduct international flights.

During a meeting between Deputy Prime Minister cum Finance Minister Bishnu Prasad Paudel and Yang Weiqun, vice chairman of the China International Development Cooperation Agency (CIDCA), on August 23 in Kathmandu, an official request for loan waiver was sent to China, according to a finance ministry statement.

Dhani Ram Sharma, chief of the International Economic Cooperation Coordination Division at the Ministry of Finance, handed over the letter to Yang at the same meeting.

Although the airport came into operation after its inauguration in January 2023, it has failed to generate enough income to sustain itself and service the loan.

After failing to operate regular international flights, the authorities are now using the airport for domestic flights. Therefore, successive governments in Nepal have requested the Chinese side to convert the loan into a grant.

“Initially the Chinese were surprised by the request,” an official at the finance ministry said. “As the Chinese themselves placed the Pokhara airport under the BRI scheme, they were clueless about what would happen if other countries too asked for loan waivers. Later, Finance Minister Paudel visited China at the end of September and made similar requests.”

Since the prime minister is planning a short goodwill visit to China, there is also the possibility of signing of the implementation plan of the Belt and Road Initiative, which has been pending since early 2020.

Officials from Nepal and China had held several rounds of discussions for signing the BRI implantation plan, but it is yet to materialise due to differences among Nepali political parties.

The ruling Nepali Congress has expressed reservations over the BRI implementation plan, stating that Nepal cannot afford high interest loans and prefers grants, and if loans are a must, the terms have to be similar to those from the World Bank, Asian Development Bank and other bilateral and multilateral lenders.

Now the list of projects that Nepal has selected to fund under the BRI has reached 14 and the plan is to seek China’s support for one big project, according to officials.

Besides the BRI framework, Nepal and China have signed another memorandum of understanding to execute various projects related to connectivity and infrastructure under the Trans Himalayan Multi-Dimensional Connectivity Network.

When Oli was the prime minister, at Chinese request, Nepal had trimmed down the numbers of projects to be executed under the BRI framework from 35 to nine. The nine projects involved Rasuwagadhi-Kathmandu road upgrade; Kimathanka-Hile road construction; Dipayal-China road; Tokha-Bidur road; Galchhi-Rasuwagadhi-Kerung 400kv transmission line; Keyrung-Kathmandu rail (feasibility study); Tamor Hydroelectricity Project (762MW); Phukot Karnali Hydro Electric Project (426MW); and Madan Bhandari Science and Technology University.

Recently, Nepal and China have also exchanged letters to upgrade the 8.2 kilometre Kalanki-Maharajgunj Ring Road, to build an Integrated Check Post (ICP), an Inland Container Depot (ICD) at Korala in Mustang, and conduct a feasibility study for repair and maintenance of the Araniko Highway.

The Chinese side has listed these additional projects under the BRI framework but Nepal is yet to respond on whether these projects were agreed under the BRI scheme.