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25-member US Congressional delegation in Nepal– has a Washington-Beijing shadow war in Kathmandu begun?

Nepalese Prime Minister Sher Bahadur Deuba with US Senator Kirsten Gillibrand

The US Congressional delegation, which is currently in Nepal, thanked the Sher Bahadur Deuba government not only for ratification of the $500 Millennium Challenge Corporation (MCC) grant but also for supporting Ukraine in the Russia-Ukraine conflict.  Nepal has also accepted a $659 million USAID grant.

According to the Kathmandu Post, the delegation from Washington is in Nepal “chiefly to seek solidarity against the Russian invasion of Ukraine.” The 25-member parliamentary delegation led by Senator Kirsten Gillibrand, met Nepal’s PM Deuba, Foreign Minister Narayan Khadka and opposition leader and former PM KP Sharma Oli.

The delegation, the news report said, has assured Kathmandu of all possible support in maintaining its sovereignty, territorial integrity and strengthening of democratic institutions. 

Last month, Chinese foreign minister Wang Yi visited Nepal. His visit was seen as an attempt to balance power equations amid Kathmandu’s not-so subtle shift in policy towards Washington.

China has already expressed its concern over the MCC grant, calling it “Pandora’s box.”

“Along with approval of MCC’s grant, a confluence of developments—including a recent $659 million USAID grant, Kathmandu’s rejection of new Belt and Road Initiative agreements due to concerns over Chinese loan agreements and a breakdown of unity in Nepal’s Communist Party—have pushed Nepal to take on an Indo-Pacific tilt,” geopolitical news and analysis platform Foreign Brief said.

The US Government’s MCC pact was signed in September 2017 but the delay in its ratification by the Nepalese government had become a sore point between Kathmandu and Washington. Several protests have broken out in Nepal following the ratification of the $500 million grant.

After Washington set a deadline of February 28 for ratifying the pact, it was finally ratified on February 27.

 Also read: Is Chinese foreign minister Wang Yi aiming to counter US influence in Nepal?

Is Nepal heading for a full blown economic crisis?