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Streamlining Access

Faster, more reliable and cheaper Internet access is expected to be the first tangible sign of enhanced Sino-Nepali cooperation, as part of the Belt and Road Initiative. The technology upgrade took place in January, when China Telecom Global, a subsidiary of the Beijing-headquartered, state-owned China Telecom, partnered with Telecom Nepal to offer an alternative to the country's existing India-channelled Internet connection.

The new terrestrial Internet gateway forms part of a major Belt and Road infrastructure project that will connect Nepal to Europe and the Americas via China. For its part, China Telecom has branded the development a core component of the Belt and Road's “information-centred high-speed link."

The new fibre-optic link is connected to the landlocked Himalayan country via the Kerung-Rasuwa border crossing and channelled through the Hong Kong Data Centre, one of Asia’s largest international data centres.  Located in the Sai Kung district of the New Territories, the HK$5 billion (US$640 million), 71,000 square-metre facility came online last December. Jointly operated by China Telecom Global, Daily-Tech, a Beijing-based Internet infrastructure specialist, and Global Switch, a Hong Kong-based data-centre developer, the new facility is reportedly both a large-scale data carrier and a regional technology hub.

First mooted in 2013, the China-Nepal cross-border Internet connectivity project was significantly delayed by the 2015 Nepal earthquake, which killed 9,000 people and rendered much of the proposed data access route inaccessible. Despite this, a formal agreement on the project was struck in Hong Kong in 2016, with the installation and testing phase completed in December 2017.

Overall, enhancing the speed, reliability and cost-effectiveness of Nepal's Internet access has been prioritised, given the surge in demand from individual users and the business sector. Of the country's 26.5 million people, 62.94 per cent had Internet access as of October 2017, up from 35.7 per cent in October 2014, according to figures provided by the Nepal Telecommunications Authority (NTA).

Internet Growth

Nepal's online population has more than doubled since 2010, when less than 30 per cent of Nepalis enjoyed Internet access. In a sign of the country's appetite for digital communication, in the 12 months to October 2017, some 2.25 million new Nepali users were connected to the Internet – approximately 250 every hour.

As in the case elsewhere in developing Asia, the majority of Nepal's Internet users go online via their mobile phones, with such usage given a further boost by 4G services that were rolled out last year. Summarising the country's changing digital profile, the NTA's 2017 annual report concluded: "The growth in Internet penetration has been facilitated by increasing mobile connectivity across the country and in particular, by the availability of browsers and data connections on even relatively inexpensive phones."

Strategic Partner

Despite being a landlocked country, Nepal is a coveted strategic location for China and India, which both see Nepal  playing a pivotal role in realising their wider commercial aspirations across South Asia. In a clear sign of its intentions to secure greater collaboration with the country, China accounted for about 58 per cent of Nepal's foreign direct investment pledges in the first half of the country's current fiscal year. Clearly keen to capitalise on this interest from two of Asia's superpowers, Nepal has introduced several new legislative measures designed to facilitate such investment, including the Industrial Enterprises Act, the Special Economic Zone Act, and the Foreign Investment Policy.

As of last December, Nepal's Ministry of Finance was reportedly considering 12 additional Belt and Road-related development proposals. They include several major road, rail, hydropower, transmission line and communication projects, as well as plans for a spectacular railway link connecting the Nepali capital, Kathmandu, with Tibet.

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Belt and Road

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