Nepali Prime Minister K P Sharma Oli’s visit to China has yielded ten agreements, including a landmark deal on transit trade.Aimed at reducing Nepal’s overwhelming economic dependence on India, the transit agreement will give the landlocked Himalayan country access to the sea via the Chinese port of Tianjin.Although Nepal has transit treaties with India and Nepal, it is with India that the bulk (98%) of its trade with third countries is conducted. Transit trade takes in all business tied to the passage of goods through a country to their destination.Its extreme dependence on trade with and via India has left Nepal vulnerable to pressure from India. An economic blockade imposed by India in 1989 caused severe fuel and other shortages and crippled the Nepali economy as did last year’s five-month-long “unofficial Indian blockade” during the Madhesi protests.
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