India downplays Nepal-China oil agreement

Nepal has accused India of imposing a blockade to punish Nepal for rushing through the constitution despite opposition from the minority groups.

Supplies to Nepal have stopped because "sections of Nepal's population are not in agreement with its constitution, they are not allowing the supplies to come through".

More than 70 percent of Nepal's trade is with India, and most of its imports enter the country through India.

An anxious India today questioned Nepal's rationale in turning to China for critical fuel supplies amid tensions between New Delhi and Kathmandu over a blockade enforced by protesters at key transit points along their border.

Answering queries from media persons here, external affairs ministry spokesperson Vikas Swarup said that the government had seen reports of Nepal signing a memorandum of understanding with Petro China to import all kinds of fuel from its northern neighbour.

When K.P. Sharma Oli, the new Prime Minister of Nepal, sent his deputy Kamal Thapa - also the foreign minister - on a visit to India earlier this month, a cautious New Delhi had hoped for a thaw in ties with the new government in Katmandu.

The deal will help the Himalayan nation's attempts to boost its oil supplies as the country's economy continues to feel pressure due to fuel shortage.

India is of the view that though the new constitution incorporates federalism, republicanism and multi-party democracy, it does not have broad-based ownership.

The spokesman also signalled that China could well become a long-term fuel supplier to Nepal, undercutting Indian Oil Corporation (IOC), which had been the sole supplier of fuel to Nepal for four decades.

Nepal had been almost totally dependent on India for overland supplies following earthquakes this year that killed nearly 9,000 people and blocked crossings from China. On the contrary, "a new generation in Nepal is keen to establish a trilateral partnership with India and China as part of a more evenly balanced foreign policy". "The Nepal-India trade relationship stands on its own, is multifaceted, and has its own logic".

"We have facilitated airlift of aviation turbine fuel earlier and we are ready to facilitate similar operations and requests".