Kathmandu, April 19 (IANS) Ahead of Nepal’s Maoist Prime Minister Pushpa Kamal Dahal Prachanda’s second visit to China next month, Beijing has stepped up its aid bonanza for its smaller southern neighbour, increasing development assistance by 50 percent.
From the earlier 100 million yuan (about $14 million), Beijing has upped its aid to 150 million yuan (over $21 million), Nepal’s state media said Sunday.

The assurance was given to Nepal’s Foreign Minister Upendra Yadav, who returned home Saturday after a nine-day tour of China, Hong Kong and Macau at the invitation of the Chinese government.

Though immediate details were not provided, Yadav said Beijing has also consented to upgrade the Rampur Agriculture Campus in southern Chitwan district - from which Prachanda graduated in the 70s - to a university and develop roads and railways between the two countries, Yadav said.

China, Yadav said, has also reacted positively to Nepal’s request to give nearly 500 Nepali products duty-free access to Chinese markets in a bid to correct the growing trade imbalance.

Nepal is seeking greater Chinese investment in its thorny hydropower sector, infrastructure, agriculture, tourism and technology.

A clear picture of the extent to which China is ready to help the Prachanda government will emerge next month when Prachanda will visit Beijing again.

However, media reports indicated that the visit might not result in the signing of a new peace and friendship treaty with China.

The coalition government needs to consult its major allies as well as the main opposition Nepali Congress party before signing any agreement of national interest.

However, now racing against time to draft a new constitution by 2010, the parties have yet not discussed the draft of the new treaty, foreign ministry officials said.

Significantly, between Yadav and Prachanda’s visits, a delegation from the second-biggest ruling party left for Beijing Saturday.

Jhalanath Khanal, chief of the Communist Party of Nepal-Unified Marxist Leninist, and four more senior leaders, are currently on a week-long visit to China on the invitation of the Communist Party of China.

Beijing’s overtures to Kathmandu come in a bid to ensure Nepal’s support for the One China policy, which regards Tibet to be an integral part of China, and to suppress anti-China protests by Tibetan dissidents in Kathmandu.

Last year, such protests had continued for nearly seven years embarrassing the dragon in the year it basked in the spotlight as the host of the Olympic Games.