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US bid to give US$500 million to Nepal sparks protests, war of words between Washington, Beijing
- American funds could create job growth in Nepal, which has been hammered economically by the pandemic
- Beijing says the Millennium Challenge Corporation pact’s purpose is to target China, while protesters call it a sell-out of national sovereignty
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After repeated delays, a controversial US aid grant to provide US$500 million in vitally needed infrastructure funds to Nepal has been introduced in the country’s parliament for approval. Washington has imposed an end of February deadline for lawmakers in Kathmandu to ratify the Millennium Challenge Corporation (MCC) pact.
But the quickly approaching deadline is not the only thing that could scupper the agreement, as the US-China rivalry and domestic disagreement are threatening to sink the deal signed in 2017.
“The current political calculus is not very conducive,” said Santosh Sharma Poudel, co-founder of the Nepal Institute for Policy Research.
Fresh protests erupted Sunday in the capital of Kathmandu after the grant was tabled with police firing tear gas to disperse demonstrators who called the pact a sell-out of national sovereignty. Their views echo that of Maoist politicians in Nepal who have traditionally been pro-Beijing.
The discord over the grant has polarised politics in the impoverished state squeezed between India and China, and threatens the survival of the coalition led by Prime Minister Sher Bahadur Deuba of the centrist National Congress. It has also sparked a US-Sino war-of-words. Beijing will “definitely be wary of increasing American influence in its soft belly,” said Poudel.
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