China’s BRI in Nepal burdened with hollow promises as Rasuwagadhi border remains closed

Govinda Luitel

October 11, 2021


China’s BRI in Nepal burdened with hollow promises as Rasuwagadhi border remains closed

RASUWAGADHI: In what can be termed as a blatant violation of its own commitment, China has tightened its grip at the Rasuwagadhi-Kerung border point, which was brought into operation declaring it as a major international border under its ambitious Belt and Road Initiative (BRI).

The Rasuwagadhi border — opened on December 1, 2014 — was announced as an international border on August 30, 2017. 

When the road upgrading works on the Syaphrubesi-Rasuwagadhi section to connect Nepal’s capital Kathmandu and Rasuwagadhi — a bordering town near China — began, Nepali traders were highly enthused.

However, their enthusiasm vanished in a jiffy when China imposed an undeclared blockade of the border by stopping more than 1,000 containers carrying clothes, shoes, electronics, fruits and raw materials from entering Nepal in Rasuwagadhi border point using the excuse of coronavirus.

Dubbed as an alternative route to the current Kathmandu-Rasuwagadhi Road, the section is part of 86-km Rasuwagadhi-Syaphrubesi-Galchhi road connecting Kathmandu with another national highway. 

Nepal had placed the Kerung border point on a priority dubbing it as an alternative to the Tatopani-Khasa border that was blocked after the 2015 earthquake. 

China, meanwhile, has allowed only up to nine trucks each day from the key border point of Rasuwagadhi to enter Nepal, which means that only five percent of the normal cargo has been entering Nepal each day during the festive season.

Possibilities of importing the goods stuck at the Rasuwagadhi border before the Tihar festival look slim, according to Nepali truck drivers there.

Despite months of efforts to increase the daily import quota, China has not opened the border points under various pretexts.

Moreover, as Nepalis are not allowed to enter the Kerung border point, traders are forced to pay a hefty amount of money for goods and transportation.

“Neither the border point is well-managed, nor has China allowed smooth operation of the trucks,” truck driver Arjun Poudel told Khabarhub in Rasuwa.

He said that the border point is unmanaged. “Earlier, the vehicles did not have to wait in a queue to load the goods here. However, now even though there is a queue system, it is not very effective.”

The Rasuwagadhi-Kerung border point was brought into operation by Nepal and China as a major international border point on December 1, 2014, and had also announced as an international border on August 30, 2017. 

Despite the announcement to increase trade, tourism, and people-to-people relations through this border point, the condition of the dry port is in a dilapidated state.

Sadly, 70 percent of Nepali traders are compelled to import goods from China by using Indian seaports as alternative transit points with increased transportation costs. 

“We are compelled to pay a hefty amount of money (around 2 to 3 lakhs per month) as house rent in Kerung. The landlords have been piling pressure on us to pay the rent,” Phurbu Tsering Tamang, a businessman, who owns a shop in Kerung told Khabarhub.

According to him, around eight years ago, they had received temporary permits to do business in Kerung. A significant number of Nepali entrepreneurs used to stay in Kerung for doing business.

“However, after the COVID-19 pandemic, China closed its borders in 2019 pushing us in a trouble,” he said adding, “We have invested millions of rupees in Kerung. Some Nepalis have hotels, restaurants, and other businesses there.”

He said that several vehicles have also been stranded there with no signs of opening the border by the Chinese side.

“We were hopeful that the borders would open. I can’t understand why China is not considering to open the borders,” he lamented.

Tamang said that they (entrepreneurs) also led a delegation to the district-level authorities, and even met with then Foreign Minister Pradeep Gyawali and submitted a memorandum apprising him about the problems that they were facing in the border.

Before the coronavirus pandemic, more than 100 containers of goods were imported each day from the Rasuwagadhi border point.

However, since it requires only 20 days for the goods to arrive from China’s Guangzhou, they are compelled to wait for more than three months. A local businessman complained that the government, too, is least bothered to take any initiative. 

The government is least bothered even though the Chinese are taking exorbitant transportation fares from Nepali traders.

The undeclared closure of the border by China has caused enormous losses to Nepali traders. 

According to available customs data, Nepal collected around 15 percent of its annual targeted amount of Rs 11 billion through the Rasuwagadhi Customs Office.

Likewise, the country collected Rs 400 million from the annual targeted amount of more than Rs 5 billion from the Tatopani Custom Office.

Drivers are also compelled to wait for quite a long time due to lack of management, delays and commission game by the Nepali authorities.

Despite China’s commitment to transform Nepal into a “land-linked” country from landlocked under the BRI, its undeclared closure of the border and tightening its grip at Rasuwagadhi, once declared “international border” have come as a serious blow to Nepal with China violating its commitment.

Meanwhile, due to the lack of parking in the border area, containers are seen queuing on the side of the road in risky places. Although the road section is geographically awkward and risky to construct, it does not appear to be built according to the standards.

As China does not allow Nepali businessmen to enter China, they are forced to pay a hefty amount of money for the price of goods and even for transportation.

The businessmen have complained that the government has not taken any initiative even when the Chinese are charging unnatural fares to Nepali traders.

Although Nepali businessmen have been taking initiative for two years to facilitate the border checkpoint, China seems to be least bothered because of which Nepali consumers are suffering due to high prices.

China has tightened its grip on the border area, allowing only a handful of goods-laden trucks, with police blocking one kilometer of the border and Chinese officials not allowing people without PPEs. 

Local hotels and businesses have also come to a standstill as China has not opened the border. 

“To tell you the truth, the Government of Nepal has never been sincere when it comes to upgrading and repairing the roads. It drains away the budget to fulfill its vested interests,” Keshav Bhatta, a truck driver said adding, “We never know what would happen to us, when we would die, or when we meet an accident due to pathetic road condition.”

He demanded that the roads were properly managed.

The torment of the road and the delay of the customs seem chaotic in and around the border area. Due to the dilapidated road condition, truck drivers are forced to work at the risk of their lives.

China’s Kerung is only 24 kilometers away from Rasuwagadhi. According to the agreement signed between the two countries, China should allow the locals of the bordering area to enter China without hassles. However, this has been limited to papers. Since the traders and locals are not allowed to enter China to bring goods, they are bound to lose millions of rupees.

The construction of an integrated customs building in Rasuwagadhi on the Nepal side has been at a snail’s pace.

Similarly, construction work of a dry port at Timure near Rasuwagadhi is underway. Although the Government of Nepal has planned to complete the construction in 2019, not much progress has been made so far. 

The government plans to extend the Rasuwagadhi-Galchi road to Thori in Chitwan. China has referred to this as the Himalayan Silk Road.

Since the border checkpoint has not been prioritized, China, too, seems to be least bothered.

The border checkpoint considered as the lifeline of Nepal-China bilateral trade is in a state of disrepair.

Consider what Chheten Gyalpo Lama, a resident of Syabrobedi-5, and an import-export businessman at Kerung has to say: “Despite being administered vaccines against coronavirus, China has been reluctant to send goods to Nepal and to open the border point. We are suffering a loss of millions.”

He strongly urged the Government of Nepal to take immediate initiatives to hold talks with the Chinese side and open the Rasuwagadhi border, which was once hailed as an international border.

Currently, it takes more than eight risky hours to reach Rasuwagadhi from Kathmandu. The government had plans to make travel easier within three hours. Meanwhile, the initial estimate of Rs. 30 billion for the construction of the road connecting Rasuwagadhi has been doubled.

The government has constructed two sections of the 46 kilometers of Galchi-Malung and 19 km of Malung-Syafruveshi road sections out of three sections. 

The last section of 17 km connecting Rasuwagadhi to Syafruveshi-Rasuwagadhi has been constructed by the Chinese. All the road sections are risky.

There are also plans to build two tunnels on the road to Rasuwagadhi. The government has a plan to make travel easier through the tunnel in the Tokha-Chhare section of the tunnel and Betravati-Syafruveshi. 

As the border point is not feasible, the Chinese, too, do not seem to have given priority to it. The Kathmandu political debate on the Kerung-Kathmandu railway has been going on for a long time, but the work on the field is still in despair.

The undeclared closure of Tatopani and Rasuwagadhi border points by China for more than a year has created problems and an enormous loss for the Nepali traders. 

Nepal China Border at Rasuwagadi

Despite this, the Government of Nepal, too, seems least bothered to address this problem.

That’s not all. Earlier, it used to take just two weeks for the trucks to reach Nepal through the Rasuwagadhi border point. 

Now that it takes around two months for Chinese goods to reach Nepal.

“The government of Nepal is in a slumber. Had China opened the borders, the people of Rasuwa could reap the employment benefits. But since China has closed the border, we are desperately waiting for the borders to open,” said Tenjing Geshin Tamang, an owner of a hotel.

BRI: Hollow Promises

Nepal signed Belt and Road Initiative (BRI) — China’s ambitious global connectivity project — on 12 May 2017. However, it has seen no progress so far, and has been limited to papers and hollow promises from the part of China.

The MoU, which was automatically renewed in May 2020 for another three years, is expiring in 2023. 

Despite the commitment to transform Nepal into a “land-linked” country under the BRI, its undeclared closure of the border and tightening its grip have come as a blatant violation of its own commitment.

Even though Nepal had identified nine projects for potential funding under the BRI, the progress is in the middle of nowhere as it looks quite different now than it did when signed in 2017 to become the first South Asian country to join it.

This, as experts view, is a blatant violation of China’s own commitment. 

It was expected that the Syaphrubesi-Rasuwagadhi section connecting Nepal’s capital Kathmandu and Rasuwagadhi would serve both Nepal and the Nepali traders.

However, it all ended in a whimper as China has currently imposed an undeclared blockade by stopping more than 1,000 trucks carrying goods imported by Nepali traders.

Experts are of the view that Nepal should take another look at BRI in view of the developments in other countries, including in Africa, which has canceled their contracts for the projects as it may lead to a debt trap to Nepal as well.

Initially, China promised investment worth $10 billion. However, the promises have gone almost astray as far as the projects are concerned.

Trucks at Rasuwagadi

It may be recalled that China had also promised to build the Budhi Gandaki hydro project — Nepal’s biggest hydropower project – and complete it by 2022. However, no significant progress has been made so far.

The BRI — portrayed and projected as an economic endeavor meant for the benefit of the region — is, in fact — intended to serve China’s interests particularly in economic as well as strategic domains because BRI, as promised, has not come out of a sincere commitment to serve the common good.

In fact, it has come to expand China’s circle of friends to strengthen its influence in countries and the regions where the democratic practice is weak.