As former President Bidya Devi Bhandari embarks on a significant visit to China, the journey underscores Nepal’s ongoing efforts to balance diplomatic relations with its powerful neighbors, India and China. While the visit aims to strengthen ties and explore economic opportunities, it also brings to the forefront concerns about potential debt implications associated with Chinese investments.

President Bhandari’s visit to China is part of Nepal’s broader strategy to enhance bilateral relations and attract foreign investment. During her previous state visit in 2019, Nepal and China signed several agreements, including protocols related to the 2016 Trade and Transit Agreement, aiming to improve connectivity and trade routes . These efforts align with China’s Belt and Road Initiative (BRI), which Nepal joined in 2017, seeking to leverage infrastructure development for economic growth.

Despite the potential benefits, Chinese investments have raised concerns about debt sustainability. The Pokhara International Airport, constructed with a $216 million loan from China, has become a focal point of this debate. Critics argue that the project’s financial viability is questionable, especially given the lack of international flights and operational challenges . Such projects have led to fears that Nepal could fall into a debt trap, compromising its economic sovereignty. 

Nepal’s strategic location between India and China necessitates a delicate diplomatic balance. While strengthening ties with China, Nepal must also consider its longstanding relationship with India. The country’s participation in the U.S.-funded Millennium Challenge Corporation (MCC) project further complicates this dynamic, as it seeks to diversify its international partnerships . 

President Bhandari’s visit to China highlights Nepal’s pursuit of economic development through international cooperation. However, it also underscores the importance of cautious engagement to avoid potential debt pitfalls. As Nepal continues to navigate its foreign relations, transparent and strategic decision-making will be crucial to safeguard its economic interests and sovereignty.