China sends huge consignment of goods to Nepal, will hit Indian firms hard

Beijing: China has initiated a major goods movement to Nepal via Tibet, in a move that could severely affect Indian businesses in the region.

According to a report, the first major consignment of goods worth USD 2.8 million has left the Chinese border for Kathmandu.

This is the biggest goods movement between the two countries since 2005 when China built what it calls the Friendship Highway to link towns on two sides across difficult mountain terrain, said the report.

The move will severely hit Indian businesses which had unfettered access to the Nepali market for decades, said the report.

Goods of daily use, electronic and electrical appliances are being transported. Dozens of trucks set off from the Tibetan border port of Gyirong for Kathmandu, 860 kilometres away, said Chinese news agency Xinhua.

China has been encouraging Nepal to reduce its dependence on India for the supply of goods and services like energy and telecommunication since early this year.

A week ago, Nepal signed an agreement with China on movement and exchange of containers, as well as another for use of Chinese telecommunication goods and facilities.

This move is of mutual benefit to the two countries. China feels that goods movement across the border will encourage Nepal to accept the Chinese offer for rail connectivity. On the other hand, Nepal Prime Minister Prachanda has accepted the movement because he wants Chinese President Xi Jinping to visit the mountainous country.

It is said that China is eager to please Prachanda also because it wants the PM to remain in power for a long time. This is because his main Opposition rival Sher Bahadur Deuba, recently attended a meeting in which the prime minister of the Tibetan government in exile was present, thus angering China.