In a landmark achievement in their age-old bilateral relations, Nepal and China have recently reached a formal agreement as per which the former will import oil from the latter.
The Nepal Oil Corporation (NOC) and China National United Fuel Corporation (CNUFC) signed the deal in Beijing on Wednesday, thus breaking the sole dependency of the NOC on the Indian Oil Corporation (IOC) for the supply of fuel.
Nepal is suffering severely from fuel crisis triggered as a result of the Indian embargo.
The IOC has been curtailing the fuel export to the Nepal Oil Corporation (NOC) by as much as 90 percent for the last six weeks. And, this has cast blight on the daily lives of common people apart from strangling the national economy.
In this light, China has been showing a benevolent gesture of helping Nepal to get rid of the deepening fuel shortage.
In fact, the northern neighbour last week offered Nepal 1.3million litres of petrol in grant.
Nepal plans to import 30-40 percent of its total fuel needs from the north in a commercial manner. Nepal’s oil import bill in the last fiscal 2014-15 amounted to Rs110 billion—the largest of imported commodities.
Chinese Foreign Ministry Spokesperson Hua Chunying at a press conference in Beijing on October 26 said that the Chinese side was ready to offer necessary assistance as a friendly neighbor to relieve the shortage of fuel supply in Nepal.
With the recent signing of the oil agreement, the consignment of 1,300 tonnes petrol would be transported from China to Nepal through the Kerung-Rasuwagadhi border point. This will certainly help ease the pain and plights of Nepali people triggered from fuel crisis.
According to experts, Nepali politicians and bureaucrats must recalibrate the country's energy policies to ensure long-term solutions to the fuel crisis. "Such recalibration should focus on adopting certain strategic measures. Ensuring economically and technically viable import of fuel from source options like China and allowing the private sector to get into the oil-importing business could well be such measures," they argue.