New Delhi: China’s economic influence in Nepal continues to grow by leaps and bounds with Beijing again topping the list of nations who have pledged maximum FDI into the Himalayan nation.
According to Nepal government figures, China accounted for as much as 68 per cent of all FDI pledged for Nepal in the first half of current fiscal year.
This is a massive jump from China’s 40 per cent share of the total FDI pledged for Nepal by various countries in 2015-16.
According to Nepal’s Department of Industry, China accounted for $ 51.77 million out of a total of $ 76.39 million FDI pledged for Nepal in the first half of the current fiscal year. This has further cemented China’s position as top contributor of FDI for Nepal.
Quoting the figures, China’s Xinhua said in a report Sunday that the total FDI pledged into Nepal for the same period during the last fiscal (2015-16) was only $ 59,93 million when the country had gone through troubling blockade from India”.
In 2015-16, while China topped the list with a commitment of $ 57 million as FDI, India stood third with $18 million. The total FDI pledged to Nepal in 2015-16 was roughly $ 140 million.
Indian officials responded by saying that that New Delhi’s support to Nepal couldn’t be measured only in terms of pledged FDI and that India also contributed $ 50-70 million every year as aid to Nepal.
Against the $600 million commitment Nepal received in 2014-15, only $140 million was pledged to it in 2015-16, mainly because of the political uncertainty. China’s share though remained steady in terms of percentage of total FDI committed. Half way into the current fiscal though, the pledged FDI by China has risen astronomically.
It’s also significant that last year, Nepal counted the UK, US, Japan, China and Switzerland as its top 5 bilateral development partners on the basis of official development assistance (ODA) disbursement, leaving out India from the list for the first time in past 5 years.
Nepal’s finance ministry had said in its Development Cooperation Report last year that ODA disbursement by India had decreased from over $47 million to $ 22 million in 2014-15. MEA countered it by saying that this figure was misleading and totally distorted the picture as actual funds released to assist Nepal from MEA’s Aid-to-Nepal budget was in the range of Rs 300 to 400 crore annually, or over $50 to 70 million.
The government had attributed this “discrepancy” to the fact that a good part of India’s aid to Nepal was not necessarily routed through the Nepalese treasury.