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“On this issue, we do have reservations, but we need investment, we need capital,” he said. “So there has to be a balance.”

Located between Asia’s two booming superpowers, China and India, Mr. Bhattarai said Nepal was watching closely the strengthening of ties between Washington and New Delhi, including the just-approved U.S.-India civilian nuclear agreement. He said Katmandu has long looked to the United States to counter the pressure it receives from its giant neighbors.

“When the U.S. moves closer to India, it tends to be a bad thing for Nepal,” he said. “India’s policy [for the region] will be the U.S. policy, and the result will not be a balanced package.”