In a major blow to the Belt and Road Initiative (BRI), Nepal has filed a corruption case related to massive irregularities in the China-sponsored Pokhara International Airport, formally indicting Chinese contractors and consultants.
The interim government led by Prime Minister Sushila Karki unearthed systematic irregularities, unnecessary delays, and manipulated pricing that occurred over more than a decade. This has raised serious questions about the integrity of earlier governments led by KP Sharma Oli and Pushpa Kamal Dahal ‘Prachanda’, with the public now demanding accountability.
China CAMC Engineering acted with mala fide intent to secure the airport project, according to the chargesheet filed by Nepal’s Commission for the Investigation of Abuse of Authority (CIAA). It states: “The contractor, China CAMC Engineering Co. Ltd., along with other accused parties, having been awarded the contract under law, did not proceed with procurement correctly. Instead, they artificially inflated the cost estimate, raising it as high as USD 286.526 million—significantly above the originally approved amount. This indicates misuse of procurement procedures and deliberate overpricing. As a result, there is alleged corruption and loss to the public sector.”
The Pokhara corruption case has opened a can of worms. As a result, several other Chinese projects in Nepal—especially those under the BRI—may now be subjected to investigation, as they too have been accused of overpricing, financial opacity, and posing debt risks.
“This is unprecedented. The anti-graft body filed this case only because it could function independently under the new government,” said Madan Krishna Sharma, president of Transparency International Nepal.
A parliamentary committee formed about a year ago to probe the scam found dozens of cases of irregularities and corruption that occurred during the tenures of Oli and Prachanda. “The corruption and irregularities amount to around Rs 14 billion at the current exchange rate of the US dollar,” said Prem Ale, a member of the committee.
After a month-long investigation, the CIAA filed a chargesheet against 55 individuals, including officials of China CAMC Engineering Company, a construction arm of the Beijing government-owned conglomerate Sinomach. Since China provided a loan for the project, only Chinese companies were allowed to compete for the contract.
The criminal case has sent shockwaves through political circles, as the chargesheet names Chinese contractors as well as close confidants of former prime ministers Oli and Prachanda. Public demand to punish those involved in corruption is now growing.
“Everyone involved must be held accountable, including international contractors. This issue should not be tied to bilateral relations but treated purely as a corruption- and governance-related matter,” said Sharma of Transparency International.
Activists, NGOs, and Nepali youth have welcomed the criminal case related to the China-built Pokhara Airport. “It is really exciting news for us. We expect many more such actions. We wish such action should be taken consistently,” said Pradip Gyawali, a leader of the mass movement that saw nationwide protests by Gen Z populations against corruption. Protests against the social media ban later snowballed into broader demands for accountability and action against corruption.
China manipulated procedures, violated standard procurement practices, and bribed local politicians to secure the Pokhara International Airport contract, said Vijay Kant Karna, a former diplomat and chair of the Kathmandu-based Centre for Social Innovation and Foreign Policy. “As a result, the country has suffered greatly while political leaders and bureaucrats received kickbacks,” he said. Anil Giri, a journalist from Kathmandu, said China declared the Pokhara Airport project a BRI component despite reservations from Nepal. “Now, international media has a solid case to demonstrate how corruption is prevailing and being fuelled in BRI projects,” he said.
Several Chinese-funded projects in Nepal have come under scrutiny for construction delays, cost escalation, and inefficiency, leading to anger and frustration among local residents. “Most contracts awarded to Chinese companies are painfully slow, or corruption has been an issue. Do they do the same in China? Mugling–Pokhara, Nawalparasi–Butwal Highway, Pokhara Airport, Kathmandu Ring Road, etc., just to name a few,” said Kathmandu resident Shailesh Kant.
There are strong undercurrents suggesting that those implicated in the corruption case should not be allowed to hold public office or contest elections. “Everyone shares the same demand: those who commit corruption must face action, and the guilty must not enjoy impunity. The investigation must be concluded swiftly,” said Jayamukunda Khanal, former chief secretary of the Nepali government.
The government’s move may pose serious challenges for Oli and Prachanda, as the Nepali public now expects genuine accountability, said journalist Tajul Islam. “As Nepal prepares for elections amid rising public anger, leaders will soon face judgment not only from prosecutors and courts, but from a new generation determined to reshape the country’s political future,” he said.
Comment