Nepal and India open first South Asian oil pipeline to counter China
The facility, which connects Motihari (Bihar) to Amlekhgunj (south of Katmandhu), will supply Nepal with two million tonnes of oil every year. Relations between the two neighbours have improved since the 2015 crisis, triggered by Delhi’s reaction to Nepal’s constitution.
Kathmandu (AsiaNews/Agencies) – The governments of India and Nepal have inaugurated South Asia’s first cross-border oil pipeline during a ceremony held yesterday via videoconference in the presence of Indian Prime Minister Narendra Modi and his Nepali counterpart, Khadga Prasad Sharma Oli.
According to analysts, the 69-kilometre pipeline is designed to counter China's hegemony in the Himalayas. It links Motihari (Bihar) to Amlekhgunj, about 100 km south of the Nepali capital, with, at one end, the storage facilities of state-owned Indian Oil Corporation (IOC) and those of the Nepal Oil Corporation, at the other.
India funded the 3.2 billion rupees (US million) project, which will supply oil constantly and at low cost. The pipeline will save Nepal about .7 million a year in transport costs, said Birendra Goit, a spokesman for Nepal Oil Corporation.
Nepal consumes each year about 2.66 million tonnes of oil and about 480,000 tonnes of cooking gas, currently carried by lorries. The pipeline will deliver two million tonnes of oil.
Yesterday the Indian prime minister pledged future cooperation on new projects, first of all on a corridor to deliver natural gas across the border.
Relations between India and Nepal, which share 1,751 kilometres of border, have improved since a crisis broke out at the end of 2015 in the Terai region.
After being long-term allies, the two countries saw bilateral trade drop considerably after India imposed an unofficial export embargo against Nepal after it adopted its first democratic and secular constitution.
The blockade stopped the delivery of fuel, food and other essential goods bringing the country to the brink of civil war, at a time when it was still reeling from the devastating earthquake of April 2015 that killed more than 9,000 people.
China saved the country from bankruptcy, replacing India as a Nepal’s main partner. In recent years, Beijing invested millions of dollars in the Himalayan nation to build hospitals, roads and hydroelectric plants.
India’s latest move “is a very, very important development,” said Shiv Mukherji, a former Indian ambassador to Nepal. “The pipeline connects India seamlessly to Nepal underlining the fact that geography favours India-Nepal relations naturally" over those with China.