Prime Minister Pushpa Kamal Dahal Prachanda's visit to China from September 23 to 30, coinciding with the Asian Games, highlighted the current status of Nepal-China relations and the shifting priorities of each country. Meanwhile, at the UNGA78, Nepal sought international support, especially for climate action. During the same month, Nepal and India signed a power agreement allowing Nepal to purchase 10,000 MW of electricity. This agreement marks an important step in Nepal's energy development, with improved cross-border infrastructure and access to India's real-time electricity market. The agreement is expected to promote economic growth and expand Nepal's energy sector.

Timeline of Major Events

 

Date	Events
5th September	India approves the purchase of 10,000 MW of electricity from Nepal.
19th – 22nd September	Prime Minister Prachanda led delegations and participated in the 78th United Nations General Assembly (UNGA78) in New York.
23rd – 30th September	PM Prachanda made an official visit to China.
30th September	India approved Nepal's participation in the real-time energy market.

PM Prachanda`s visit to China

During his visit to China, coinciding with the Asian Games, Prime Minister Pushpa Kamal Dahal Prachanda met with senior Chinese officials, including President Xi Jinping. While Prachanda sought to normalize Nepal's and his personal relations with China, the joint statement issued after political consultations provides a more complex picture.
Prachanda's China visit comes after a shift in political alliances, as he moved from an alliance with Nepal Communist Party leader KP Oli to an alliance with the Nepali Congress. This shift is viewed as a shift from affinity with China to affinity with the United States and India, and it marked a slowdown in Nepal's relations and earlier understandings with China, particularly those reached during Chinese President Xi Jinping's visit to Nepal in 2019.
Nepal's primary objective is to balance safeguarding its sovereignty and advancing its development goals while fostering a more equitable relationship with China. This entails strengthening connectivity between the two nations, respecting democratic processes, and upholding the one-China policy, a key concern for Beijing.
China's interests in Nepal are centered on:

• Securing support for its core interests in Taiwan and Tibet
• Promoting its international diplomacy, development, and security initiatives in partnership with Nepal
• Expanding the Belt and Road Initiative (BRI)
• Strengthening connectivity with Nepal as a means of reaching out to South Asia
• Developing a trusted and “strategic” relationship with Nepal

China was able to secure Nepal's opposition to Taiwan's quest for independence and support for Tibet. However, Nepal was not ready to agree to a framework agreement on the implementation of BRI nor support GCI and GSI initiatives. As a result, Nepal's aspirations for investments, trade, and transit have not been fully realized.

Nepal at UNGA78

The 78th United Nations General Assembly (UNGA78) provided a platform for Nepal to seek international support, strengthen bilateral ties, and advocate for global initiatives aligned with its development priorities, led by Prime Minister Pushpa Kamal Dahal. The delegation emphasized effective climate action, increased support for Least Developed Countries (LDCs), and global peace and disarmament cooperation. Prime Minister Dahal also made transitional justice a primary political agenda, promising completion during his tenure—Nepal's Foreign Minister N.P. Saud signed the 'Marine Biodiversity of Areas Beyond National Jurisdiction (BBNJ) Agreement,' highlighting the importance of a rules-based international order, financing, and trade facilitation for Landlocked Developing Countries (LLDCs), including Nepal. Nepal has also actively promoted its candidate, Shambhu Prasad Acharya, in the multilateral forum for the upcoming WHO South East Asian region Director election. Moreover, Nepal's attempts to revive SAARC meetings this year appear unsuccessful, suggesting waning interest from the member countries. The meetings have been unproductive for the past three years.

Nepal-India Electricity Agreement

The approval of India to purchase 10,000 MW of electricity from Nepal on September 5th  over the next decade is expected to mark a crucial step in Nepal's electricity development roadmap. To facilitate this, both countries have worked to enhance their cross-border transmission infrastructure, with plans to expand the Dhalkebar-Muzaffarpur Cross Border Transmission Line and expedite the construction of smaller cross-border power lines. These efforts aim to increase electricity trade between the two nations. Additionally, Nepal's access to India's real-time electricity market, allowing for more efficient trading and reduced wastage, will further benefit Nepal's power exports, particularly during rainy seasons when hydropower projects operate at peak capacity. These developments could drive Nepal's economic growth and energy sector expansion.