Nepal and China inked a cooperation MoU for the Belt and Road Initiative in 2017, but as of now, no new BRI projects have been implemented in Nepal. Despite China’s recognition of the Pokhara International Airport as a BRI achievement, Nepal does not consider it a BRI project due to pre-existing negotiations.
In Nepal, no BRI projects have been executed, with only preparatory work underway for potential projects. Projects like the Kerung-Kathmandu Railway and China-Nepal Friendship Industrial Park are in the feasibility study and preparatory stages. The Phukot Karnali Hydroelectric Project, initially a BRI proposal, is now being developed jointly by Indian and Nepali companies.
The disagreement over project development approaches has stalled initiatives like the Tamor Storage Hydroelectric Project. Changes in project selections were made in 2024, including a cross-border railway project. The current government plans to develop a cross-border railway with China in the upcoming fiscal year.
Confusion over project implementation conditions, including funding sources and involvement levels, has hindered BRI progress in Nepal. Concerns over debt traps from high-interest loans have led to calls for grant funding and clear financing terms. Nepal’s geopolitical considerations, influenced by India and the US, have also impacted BRI implementation.
