The Belt and Road Initiative in Nepal: An Analysis of Opportunities and Challenges

Abstract

In 2017, Nepal joined the Belt and Road Initiative (BRI) by signing the Memorandum of Understanding (MoU). After seven years of signing the MoU, China and Nepal signed the “Framework for Belt and Road Cooperation” in December 2024. Initially, Nepal proposed thirty-five projects under BRI, including sectors such as roads, railways, energy, and trade. However, the negotiations with China reduced the projects to ten by 2024. Through BRI, Nepal intends to transition from a landlocked country to a land-linked country. However, there has been slow advancement in the implementation of BRI projects in Nepal. That highlights a gap between the strategic intent and the on-ground progress of BRI projects. The paper aims to examine the barriers that restrict the advancement of BRI projects. This study will employ a qualitative and descriptive methodology. The study finds that overlapping internal and external factors hinder the progress of BRI in Nepal. Internally, factors such as bureaucratic incapacity, frequent political changes, disagreements over project terms, and environmental concerns limit the progress of BRI. Externally, India’s concerns over the increasing presence of China in the region influence Nepal to take a cautious approach towards BRI and China. As a result, the progress of BRI is slow in Nepal. To gain from BRI, Nepal needs to maintain a balance among these factors.