Nepal inks MoU with China to ease fuel crisis

Nepal has signed a Memorandum of Understanding (MoU) with China in order to import all kinds of fuel in order to ease fuel crisis in the country.
It was signed by Nepal Oil Corp (NOC) and China National United Oil Corporation (PetroChina) in Beijing to supply all kind of the petroleum products for Nepal needs.
This is the first time that China is commercially supplying petroleum to Nepal and already had agreed to donate 1.3 million litres of petrol to landlocked Himalayan country.

End of India’s Monopoly

  • With this Nepal may end a long-held monopoly of buying fuel from the Indian Oil Corp (IOC) as it had traditionally relied on its southern border crossings with India for trade.
  • Annually, Nepal used to buy around 1.3 billion dollars of gasoline from IOC.
  • Nepal had completely relied on India for its trade including fuel from southern border due to favourable geographic conditions which eased the transportation links with India compared to the mountainous terrain of the northern routes bordering China.

Economic blockade

  • Presently, Nepal is facing continued protests and economic blockade at key border trade points with India over the adaptation of new Republic Constitution.
  • The agitating protest led by Madhesi Front is claiming that the Constitution does not guarantee enough rights and representation to the Madhesi and Tharu communities residing in Terai region of southern Nepal.
  • The blockade has hit Nepal’s economy hard and hampered the supply of essential goods, including petroleum products and medicines in Nepal.




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