Beijing accused of pushing ‘debt traps’
Pramila Devkota, a researcher on Nepal-China affairs, told DW that Sri Lanka’s financial crisis had also become a reason for Nepali officials wanting to slow down Chinese financing.
Sri Lanka’s Humbantota port was built through Chinese financing at a commercial rate of 6%.
After failing to repay the debt, the Sri Lankan government handed over the port’s operation to China, drawing international accusations of Beijing pushing “debt traps” abroad.
Now, several countries, including Pakistan and Malaysia, have started reviewing more closely the conditions of BRI deals.
According to geopolitical analyst C.D. Bhatta, both Sri Lanka’s sovereign-debt crisis and Nepal’s socio structural tilt towards its southern neighbour, India, have contributed to the decline of the BRI in the Himalayan nation.
“Back in 2017, there were much favorable conditions for China when many countries were attracted towards BRI, and Nepal was also led by a two-third-majority left-wing government,” he told DW.
“Now China is nowhere on the scene in Nepal,” he added.
In February, Nepal accepted the controversial US $500 million (€470 million) American Millennium Challenge Corporation grant.
The grant is aimed at financing the upgrading of Nepal’s vital road networks and electricity transmission line. Just a few weeks later, the US extended another US $659 million in aid to support Nepal’s economy.
“Now time has come for China to revisit its overall SouthAsia policy,” Bhatta said