Himal Press 
KATHMANDU: China is facing growing challenges as several countries that took loans under its Belt and Road Initiative (BRI) are now seeking relief.
Many of these nations, heavily impacted by the COVID-19 pandemic, had borrowed extensively under what is considered the world’s largest development program. Now, they are struggling to repay their debts.
According to the Financial Times, Beijing is exploring various options to manage the situation, but it has made clear that full debt forgiveness is off the table. One option under consideration is the temporary suspension of interest payments—an approach aimed at easing the economic pressure on borrowing nations.
“We understand a lot of countries are looking to renegotiate loan terms. But it takes time to strike a new deal. The BRI loans are not foreign aid. We need to at least recoup principal and a moderate interest,” the Financial Times quoted a researcher at the China Development Bank.
China Development Bank, together with the Export-Import Bank of China, has lent billions of dollars to BRI projects all over the world.
Launched in 2013, under President Xi Jinping, the BRI is a flagship foreign policy initiative aimed at expanding China’s global influence through large-scale infrastructure development. But as repayment delays mount, Chinese officials are now signalling a shift in priorities—from international expansion to stabilising the country’s own financial position.
To date, 138 countries, most of them developing nations with limited creditworthiness, have formally joined the BRI, which was launched in 2013 as a significant foreign policy initiative of Chinese President Xi Jinping.
Many of these countries have become financially vulnerable in recent years. The debt crisis is not confined to Africa; several member states of the South Asian Association for Regional Cooperation (SAARC) are also affected. In response, India has stepped up support to some of these countries, including Sri Lanka and the Maldives.
China has provided around $461 billion in loans for BRI projects, mostly in African countries.
Beijing has agreed to free bilateral loan repayments for low-income countries until 2025.
Although not part of the BRI, the government has requested China for the waiver of the loan received to build Pokhara International Airport, as the airport, inaugurated in January 2023, has not been able to get commercial flights.
