Chinese premier pledges $176m to Nepal

Chinese Premier Wen Jiabao pledged more than $176.6 million (US$140 million) to impoverished Nepal during talks in Kathmandu marking the first visit in a decade by a leader of the world's second-largest economy.

Wen and Prime Minister Baburam Bhattarai on Saturday discussed investment from Beijing for infrastructure projects which could amount to billions of dollars, while signing a deal for a $151.3 million loan to be paid over three years.

"Prime Minister Wen's official visit to Nepal has become a great success and it has been instrumental to take the friendly relationship between Nepal and China to a new height," said Deputy Prime Minister Narayan Kaji Shrestha.

Wen offered $25.2 million to aid Nepal's peace process and almost $2.5 million for the country's police forces, Shrestha said, adding that "the message of this visit is that China has attached a great importance to Nepal".

Local media had reported ahead of the delayed visit that Nepal would seek $6.3 billion for an international airport in its second city, Pokhara, three large hydropower stations in the west and improvements to its creaking rail network.

Shrestha said China was "positive towards the requests" without revealing if they had promised any cash.

Wen was also expected to seek support for Beijing's policies in the restive region of Tibet, which has seen a wave of self-immolations over the past year in protest at Chinese rule.

Nepal, home to 20,000 Tibetan exiles, is under pressure to stem the flow of Tibetans fleeing their homeland.

Hundreds make the difficult and dangerous journey to neighbouring Nepal every year, fleeing what they say is political and religious repression in China, though their numbers have fallen sharply in the past few years.

More than 200 Tibetan exiles have been arrested in the past few days for illegally entering the Himalayan republic, Nepali police said, as part of a security crackdown in the capital.

"Both Taiwan and Tibet are integral parts of the Chinese territory," said a joint statement from the two governments released after the visit.

Nepal "firmly supports" China's efforts to uphold "state sovereignty, national unity and territorial integrity" and does not allow anti-China activities, the statement added.

Premier Zhu Rongji was the last Chinese leader to visit Nepal, in 2001, although recent years have seen a flurry of visits by Chinese delegations.

"This is the highest-level visit from China to Nepal in more than 10 years. It will be an important platform to strengthen the relationship between the two countries," said Tanka Karki, a former Nepali ambassador to Beijing.

Wen paid a courtesy call to President Ram Baran Yadav before departing - just five hours after arriving - for the Middle East on a trip to key oil-producing nations.

The Chinese leader had been due to visit Nepal in December but the trip was cancelled amid speculation over security concerns.

- AAP, AFP