This Article is From Mar 21, 2016

Nepal Seals Transit Treaty With China: To Build New Strategic Rail Link

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Nepalese Prime Minister KP Oli with Chinese President Xi Jinping in Beijing on Monday. PTI photo

Beijing: China today promised "non- interference" in Nepal's internal affairs as the two sides signed 10 agreements including a landmark transit treaty to end the land-locked country's total dependence on India while Beijing agreed to extend the strategic Tibet rail link to Nepal to boost connectivity.

On his maiden visit to China close on the heels of his recent visit to India, Nepalese Prime Minister KP Oli held wide-ranging talks with Chinese Premier Li Keqiang and called on President Xi Jinping.

"China firmly supports Nepal's efforts to safeguard sovereignty, independence and territorial integrity as well as the Nepali people's choice of development path, and will not interfere in Nepal's internal affairs," Chinese Prime Minister said.

He also praised the recent constitutional process in Nepal that led to a major political crisis in the country.

Premier Li's strong backing to Nepal comes in the backdrop of a chill in its relations with India following the months- long crippling blockade by Madhesis, mostly of Indian-origin, demanding amendments to the newly-enacted Constitution to ensure adequate political representation and reorganisation of the federal boundaries.

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Chinese Prime Minister also pledged that Beijing will boost cooperation in "key" areas with Kathmandu, including connectivity, industrial capacity, oil and gas, trade, tourism and law enforcement, state-run Xinhua news agency reported.

After the talks, the two sides signed 10 agreements including the transit treaty ending conflicting reports from Kathmandu that Mr Oli may defer it.

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The much-publicised transit trade treaty will end Nepal's total dependency on Indian sea ports for third-country trade.

They also signed a Memorandum of Understanding on a feasibility study on a free trade area (FTA).

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Under this, the two countries will set up a working group to research areas of common concern, an official statement said. China's non-financial outbound direct investment in Nepal was at $32.03 million in 2015 while bilateral trade hit $866 million.

The FTA will further boost bilateral trade and investment, the statement said.

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Mr Oli, who arrived in Beijing yesterday on seven-day visit to China, was given a red carpet welcome by Premier Li at the ornate Great Hall of the People.

Mr Oli's high-profile visit comes as Nepal seeks to open more supply routes from China amid fears of a repeat of recent nearly six-month long blockade when the Madhesis blocked Nepal's trade-routes with India, throwing normal life out of gear.  

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