Merz Seeks Reset in Germany–China Relations

Nepal and China share a relationship that stretches centuries long in terms of culture, mutual respect and geography. During a meeting in Lhasa on 27th January, Tuesday, officials confirmed plans for strengthening collaborations with inland clearance depots and the Tokha Chhahare tunnel. Senior officials from China and Nepal have agreed to accelerate several developmental projects aided by China including several infrastructural projects across the Nepal-China border.

 

Source: kathmandupost

The agreement was made after the third meeting of China-Nepal Coordination Mechanism on Border Trade and Cooperation held in Lhasa, Tibet. As per the statement issued by the Consulate General of Nepal, the meeting was co-chaired by Zhao Peng, vice-chairman of the Xizang (Tibet) People’s Government and Ram Prasad Ghimire, Nepal’s industry commerce and supplies secretary.

 The statement says,

 

“The meeting reached board agreements on enhancing bilateral trade, improving connectivity, and strengthening cross-border cooperation. Both sides agreed to move forward with discussions on key frameworks. Such as the 1981 Trade and Payment Agreement, simplifying border passes, speeding up the construction of the Tokha-Chhahare Tunnel, setting quotas for fertiliser imports, extending China’s zero tariff policy after Nepal’s graduation for the LDC status, and improving vehicle rerouting during disasters.”

The two sides agreed to carry out the Nepal China Border Transport Agreement to enhance bilateral trade by reducing time and cost during trade. According to the statement both sides agreed to use a green channel for Nepali silage exports with proper risk inspections with better lab testing, data sharing, vehicle movement and enhanced jute exports. Also, the meeting came with a conclusion regarding the proposal for the Kimanthangka road-bridge Inland Clearance Depot (ICD).

 

“Discussions also covered moving forward with the Jilong (Rasuwa) ICD, building a new Lizi (Mustang) ICD, speeding up the Hilsal-Simkot road, easing customs procedures at the Lizi port, and appreciating China’s support for the Rasuwagadhil-Syaphrubesi road.”

Further, Nepal agreed with the idea of a sister-city link between Jilong and a rural municipality of Rasuwa district for investment and upgrading tourism. The meeting came with an agreement to task the Nepal-China’s Xizang Joint Tourism Coordination Committee (JTCC) to make a Jilong Rasuwa Trans-border Tourism Zone. Both sides have agreed to have the fourth meeting in Kathmandu on a convenient date.

Nepal and China Agreement to Resume Kathmandu Lhasa Bus Service

In addition to the recent success, the long anticipated Kathmandu Lhasa direct bus service is finally set to resume after 20 years making it a major milestone in Nepal-China border connectivity, trade and trade relations. As per the report by Nepal’s Ministry of Industry, Commerce and Supplies, the decision was made during the Nepal China Joint Meeting of Commerce Secretaries held in Lhasa on 20th and 21st January.

 

The bus service will be operated from Tatopani covering a distance of approximately 1,000 kilometers with an estimated time of 20 to 22 hours. The Kathmandu Lhasa direct bus service was first initiated in 2005 by Sajha Yatayat however, due to several operational, logistical, and external challenges, the service was discontinued within two months of operation.

 

After the high level bilateral meeting, Nepali Consul General in Lhasa, Laxmi Prasad Niraula said,

 

“The Kathmandu Lhasa bus service had been launched earlier but was shut down due to various challenges. Now, there is a fresh agreement to restart it, along with efforts to simplify visa procedures.”

“There are no major issues on the road from Tatopani to Lhasa. However, the main concern lies in the Kathmandu Tatopani section. It remains uncertain whether large buses can operate smoothly on that stretch.”

 

Nepal is sandwiched between two giant regional rivals China and India. Nepal made headlines  for rapidly increased electric vehicle EV imports from China. According to the fiscal year 2024 25, over 75% with a total of 13,578 EV were imported from China.

 

China’s growing interest in Nepal is shaped by the combination of industrial policy, geopolitical strategy, and green diplomacy. All of the efforts help China expand its influence in South Asia and counter India’s traditional dominance in the region.