Nepal cancels deal with China to buy COVID-19 protective gear, medical equipment

Kathmandu gets substandard PPE, testing kits, medical equipment, and other items at escalated prices from China; Government scraps contract and orders probe

New Delhi: Vexed after being supplied with substandard quality of medical goods and equipment against the novel coronavirus (COVID-19) infection, the Nepalese government has decided to scrap its deal with China. 

The decision was taken by the Prime Minister KP Sharma Oli-government after a Chinese company supplied below-standard face masks, defective Personal Protective Equipment (PPE), medical gears to Nepal.

Nepal now joins a list of European nations including Spain, Turkey, and the Netherlands, who have rejected Chinese products – marking them as below standard or defective.

On 25 March, the Nepalese Ministry of Health, amid the lockdown in the nation, signed an agreement with the Omni Business Corporate International. According to the contract, the company was to supply 19 various items, including 75,000 rapid diagnostic kits worth $600,000, to Nepalese authorities.

As per sources, the company was sourcing all the items from China. However, not only did they fail to deliver the items on time, but they also supplied products that were below the recommended standards set by the World Health Organization (WHO).

On 29 March, the first consignment of the medical equipment, worth a total of $10,390,400, arrived in Nepal. 

According to local Nepali-language media, authorities even after knowing that the products were below WHO standards accepted them. However, they told local hospitals not to use rapid testing kits as questions loomed large on their standards and safety.

A second jolt came when a large number of medical practitioners in the country refused to use over-priced Chinese COVID-19 test kits and PPE, reasoning inferior quality of the products. Local doctors and para-medical staff alleged that the products were poorly manufactured and easily conked, tore and would at times emit a foul odor. Even health workers refused to wear Chinese personal protection equipment as several primary components of the product were missing – threatening the user of getting exposed to the infection. 

However, the Nepalese government refuting the allegations of substandard products, said that it was only the delay in supply which resulted in cancelling the contract.

“The government only received 10 percent of the contracted order. Thus, with the company failing to deliver on time, the contract was canceled. We have ordered a probe in this matter,” Mahendra Prasad Shrestha, Director-General of the Department of Health Services said. 

The Director-General also defended the government’s decision to purchase Chinese material at higher prices. He said that Nepal was obliged to purchase medical gear at a 20 percent higher rate as it was urgently required.

Shrestha’s statements were severely condemned by local community groups and activists, who alleged high-level corruption in the procurement process of the substandard Chinese products. 

They claimed that the Nepalese government paid as much as 40 times more for the supplies from China than the regular market prices. 

“The company brought around 50,000 Coronavirus testing kits, 100,000 sets of PPE, 100,000 pairs of gloves, 80,000 units of masks and 1,500 infrared thermometers via a chartered flight of Nepal Airlines. They had signed an agreement with the government to reduce the price by 0.5 percent from the original cost, however, if you see the final cost, they are all up by 20 to 40 percent,” a government official said.

Backlash – China shuts border points 

In what could be looked upon as a possible Chinese backlash after Nepal canceled the medical supply contract, Beijing refused to open trade routes with Kathmandu for the supply of essential goods.

As per custom officials in Kathmandu, the Chinese government cited concerns of the Coronavirus from Nepal spreading in Beijing and other provinces.

“Both governments had agreed to operate two-border points for wheeling in essential goods. Thus, we had opened the Rasuwagadi and Tatopani border points for the trade. However, they (Chinese custom officials) amended their stance at the last minute,” a customs officer said. 

He added that the Chinese authorities were concerned that opening of customs points would result in a large surge of inflow and outflow of people, including asymptotic individuals as well. 

India continues to aid Nepal

While China has reportedly whipped a backlash on Nepal, India continues to assist its Himalayan neighbor. According to government sources, India has agreed to allow movement of Nepal-bound goods through its customs without requiring original documents.

“We recognize the hardships the traders and dealers are facing due to the coronavirus and lockdowns in both countries. Thus, the government has taken a temporary, lenient policy to ensure smooth operations along the borders,” an official with the Ministry of Industry, Commerce, and Supplies said.

The decision taken by India was welcomed by Nepal, which on 6 April decided to extend the ongoing lockdown further until the midnight of 15 April. The novel coronavirus (COVID-19) infection has entered its second phase in Nepal where it is no longer imported but people are catching the virus from infected people. 

The government had announced a nation-wide lockdown initially for a week from 24 March and then extended it by another week.