Just a day before of embarking on an official visit to India by Prime Minister Sher Bahadur Deuba, the Investment Board Nepal has deferred the process of signing a crucial agreement with a Chinese company.

The company is reportedly all set to invest Rs37 billion in a cement factory in the country.

According to The Kathmandu Post, a leading daily, the IBN had completed all the process required to sign the Project Investment Agreement (PIA) with the Nepal-China joint venture, Hongshi Shivam Cement. The IBN was planning to seal the deal, which would have protected interest of the foreign investor in Nepal, during Chinese Vice Premier Wang Yang’s visit to Kathmandu, which concluded on Thursday. But this could not happen. Now the IBN is planning to sign the deal on September 3.

Sources at the IBN and the Ministry of Foreign Affairs told the Post that the IBN had deferred the plan to sign the agreement with the Chinese company during the Chinese vice premier’s visit as the government was concerned the issue would be raised during the PM’s meetings with the Indian prime minister and other key Indian political leaders.

This decision was taken a day after India’s reputed newspaper The Economic Times published the article saying New Worry For Modi As China Takes Deep Toot In Nepal, A Place Where Anti-India fire Is So Easy To Fan.

The economic times detailed how Chinese companies have grasped Nepali market and invested heavily in various sectors. Interestingly, the story’s filed from Darchula in western Nepal near tri-junction of Nepal, China, and India.

Chinese companies dominate India’s burgeoning electronics market and are estimated to be worth $22 billion, by the Confederation of Indian Industry,” writes The Economic Times.

“China is bagging some of the biggest projects in Nepal, be it the Pokhara International Airport or several hydroelectricity projects. But many Chinese companies that were awarded these projects have since backed off — because project costs escalate from the ridiculously low bid, and Chinese construction companies are unable to fulfill their contractual obligations,” said The Economic Times.

Just a day before a visit by Prime Minister Deuba, Indian media are taking official line showing how a regional power nervous in Nepal.