NEPAL-CHINA 101
Business | Renewable Energy | Tourism
Proceedings Report August 27, 2026
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Table of Contents Background
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Opening Remarks - Sujeev Shakya
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Study Findings - Arya Awale
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Keynote - Dr. Brian Wong
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Commentary - Aneka Rebecca Rajbhandari
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Key Takeaways
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About the Event On August 17, 2026, Nepal Economic Forum (NEF) launched the report of its two-year long study, "Nepal-China 101," bringing together policymakers, diplomats, private sector representatives, and researchers to discuss its findings and their implications for Nepal's economic engagement with China. The study examines the state of Nepal-China economic relations across trade, renewable energy, and tourism. The study finds that despite decades of formal cooperation, including zerotariff access for over 8,000 Nepali products and a series of framework agreements dating back to the 1950s, Nepal's import-to-export ratio with China stood at 1:130 in the first four months of FY 2025/26, driven in large part by EVs, which now account for 73 to 76% of new four-wheel passenger vehicle imports. This gap is driven primarily by institutional deficits on Nepal's own side, rather than by Chinese behavior, Indian constraint, or geopolitical exposure alone.
SPEAKER
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SUJEEV SHAKYA Chair, Nepal Economic Forum
NEF Chair Sujeev Shakya opened the event by welcoming guests present and joining online for the release of the Nepal-China 101 report. He framed the occasion as an attempt to understand Nepal's economic relationship with China from the ground up, across trade, energy, and tourism, and argued that grasping the countries' shared history is a precondition for understanding where the relationship goes next. He traced that history briefly, from Buddhist-era exchanges and the migration of Nepali art and craftsmanship into Tibet and China, to the career of Nepali architect Araniko, who built the White Pagoda at Beijing's Miaoying Temple and was honored as Duke of Liang. Citing the report's central finding, Shakya said the constraints on Nepal's side of this relationship are not geopolitical but institutional implementation gaps that are within Nepal's own capacity to fix. He then laid out the day's structure in three parts: a presentation of the report's findings by project coordinator Aarya Awale; a keynote address by Brian Wong; and a commentary by Aneka Rebecca Rajbhandari. He closed by introducing a short video on NEF's work.
Project Coordinator, Nepal-China 101
PRESENTER
ARYA AWALE
Presenting the study's findings across trade, renewable energy, and tourism, Awale reported that the primary constraints on Nepal's economic relationship with China stem from institutional deficits on Nepal's own side, rather than Chinese behavior, Indian constraint, or geopolitical exposure. Despite decades of formal cooperation, including zero-tariff access for over 8,000 Nepali products and framework agreements dating back to the 1950s, she noted that Nepal's import-to-export ratio with China stood at 1:130 in the first four months of FY 2025/26, driven largely by EVs, which now make up 73 to 76% of new four-wheel passenger vehicle imports. In trade, she pointed to the absence of accredited testing labs at Nepal's northern border, which erodes the value of zero-tariff access through added costs and delays. In energy, she noted that of roughly USD 2 billion in annual bilateral trade, none is in energy, a gap tied to the absence of a legal trading framework and crossborder grid infrastructure. In tourism, she cited Nepal's near-absence from the Chinese platforms where travelers plan their trips, compounding leakage of domestic spending out of the local economy. To address these implementation gaps, she outlined four cross-cutting priorities: treating northern trade infrastructure as strategic, concluding the legal frameworks that enable cooperation, managing the India-China dynamic through a more deliberate parallel-track approach, and capturing more economic value at home. She closed by noting that what Nepal gains from the relationship over the next decade depends less on what China does than on what Nepal builds.
KEYNOTE
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BRIAN WONG Assistant Professor, University of Hong Kong
Delivering the keynote address, "Towards a More Pragmatic and Balanced NepalChina Relationship," Brian Wong opened by framing China through what he called the three P's: pluralism, poverty alleviation, and pragmatism. He argued that China's poverty alleviation record, including a near hundredfold rise in per capita GDP since 1978, has been central to the ruling party's legitimacy, while cautioning that for every successful firm, thousands fail in a system he described as intensely and often unforgivingly competitive. He also traced China's governance model to a tentier bureaucracy that functions through what he termed "directed improvization," with central directives adapted and negotiated down through provincial, municipal, and local levels. Turning to Nepal, Wong stressed that deepening ties with China should not come at the expense of Nepal's relationship with India, describing the choice as a positivesum rather than zero-sum proposition. He proposed Nepal move from "equidistance to equal proximity" with its neighbors and organized his recommendations around an acronym, HATCH: history, autonomy, transparency, creativity, and humanity. Similarly, talking about Nepal and China’s history as neighbors, he urged Nepal to commercialize its civilizational depth without cheapening it, capturing rising Chinese interest in what he called emotional value in travel over low-cost mass tourism. On autonomy, he called for a clearly articulated, independent Nepali foreign policy doctrine.
On transparency, he urged Kathmandu to press Beijing for predictable market access, clarity on rules of origin, and functional border coordination, while reading recent shifts in Sino-Indian relations as an opening for more constructive engagement all around. On creativity, he recommended building certified export clusters around products such as pashmina, cardamom, orthodox tea, and churpi, arguing Nepal should export not just goods but the stories and standards behind them. On humanity, he pointed to person-to-person exchange and to Hong Kong's role as a bridge given its universities and bilingual, common-law environment as the foundation for durable trust between the two countries.
COMMENTATOR
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ANEKA REBECCA RAJBHANDARI Co-founder, The Araniko Project
Reflecting on the report, Aneka Rebecca Rajbhandari observed that discussions on Nepal-China relations tend to jump straight to major issues, geopolitics, the Belt and Road Initiative, connectivity, without first establishing the basics. She welcomed Nepal-China 101 for filling that gap, arguing that a solid grasp of trade, energy, and tourism gives Nepal a firmer, more Nepali-perspective foundation for the larger conversation. Building on Brian Wong's equidistance-to-equal-proximity framing, she said the idea gives Nepal room to engage both China and India with confidence rather than caution, recalling a Chinese Foreign Minister Wang Yi line, " " ("a close neighbor is better than a distant relative"). Citing the report's finding that orthodox tea exports to China rose more than 88% in early 2024, she described Nepali traders exhibiting at the Beijing Tea Expo for the first time in two decades, calling it a clear case of geographic proximity paired with institutional distance. She pushed back on the notion that Nepal "doesn't understand China," arguing the task is to organize existing expertise rather than assume a gap.
远亲不如近邻
She also questioned the well-worn "bridge between India and China" metaphor, since a bridge's value depends on traffic Nepal doesn't control, and proposed Nepal instead position itself around knowledge connectivity between the two. She closed by adding a sixth element to Wong's HATCH framework: capability, arguing that geography gives proximity, diplomacy builds relations, but capability determines what Nepal can do with them.
KEY TAKEAWAYS Nepal's import-to-export ratio with China stood at 1:130 in FY 2025/26, driven largely by EVs, which now account for 73–76% of new four-wheel passenger vehicle imports, despite zero-tariff access to roughly 8,000 Chinese product lines. With India and China historically accounting for 60-70% of global GDP and projected to reclaim the world’s two largest economies by 2050, Nepal, sitting roughly midway on a line drawn from Mumbai to Beijing, stands to benefit. But only if it converts that proximity into actual access Nepal is urged to shift from "equidistance to equal proximity" between India and China, with the relationship framed as positive-sum, organized around history, autonomy, transparency, creativity, and humanity, with capability added as a sixth pillar to stress execution over proximity alone. Nepal as a “bridge” between India and China is a metaphor worth retiring, since a bridge’s value depends on traffic it doesn’t control. A more useful framing positions Nepal around knowledge connectivity, given China’s strength in AI and manufacturing and India’s in technology and pharmaceuticals.
Click here or scan the QR code to watch the full video of the event!