India Watching New Nepal Regime Closely, Concerned about Chinese Debt Trap: Top Govt Sources to News18 – News18

The Indian establishment is watching the new Nepal regime very carefully and will support it fully but will expect a committed relationship, top government sources told CNN-News18 on Wednesday.

Nepal’s Prime Minister Pushpa Kamal Dahal ‘Prachanda’ last month reshuffled the cabinet after terminating a nearly 15-month partnership with the Nepali Congress due to major differences between the top leadership of the two parties, and he stitched up a new alliance dominated by Left parties with former premier KP Sharma Oli’s party UML.

“A wrong narrative is spread that India supports corrupt politics in Nepal. This is absolutely wrong and India will try to regain faith in Nepal at the earliest,” an Indian government official said.

There is growing integration between South Asian countries and the increasing interest of China, the USA, and Europe is a major cause of concern for India, officials said.

So far South Asia has not seen much competition economically and geopolitically but with increasing US and China interest, certain parties are trying hard to create an unfavourable environment for India in the region, they added.

India is committed to all-out development in Nepal, said officials, including financial assistance, line of credit, and development cooperation.

China has made many infrastructure blunders in Nepal recently but despite that Oli will be closer to Beijing for various reasons, they said.

With this new regime in power, said the sources, China will push to get Nepal’s consent on the Belt and Road Initiative (BRI). They added that recent intelligence reports also suggest Nepal will soon sign the BRI implementation plan with China.

India doesn’t want Nepal to move forward with any such pact and it had been successful to a large extent thus far, officials said.

In 2017, Nepal signed the BRI framework agreement and work on 35 projects started, but due to India continuously discouraging Nepal, the number was reduced to just nine, they said.

The major concern for India, said officials, is the attempted Chinese debt trap in Nepal after Sri Lanka.

India told Nepal to ask for soft, concessional loans, and grants from China, and not commercial loans that are a debt trap, they said.

Also, officials said the Indian side has to work very hard to fight the deep penetration of China into Nepalese society.

“They are running a huge number of FM stations, their cyber syndicates are working from Nepal targeting India and taking the Nepalese to China to lure them,” said an official. “The Indian side is working hard to bring stability to the region and understands that Oli has also come with a positive frame of mind towards India, as we have ‘Beti and roti ka rishta’.”