China has in recent years expanded its footprint in Nepal, assisted perhaps by India not being concerned enough for local sensibilities. However, making inroads into the Nepalese space is easier said than done for China, as its aggressive designs are becoming obvious in many countries. Thus, this is an opportune moment for Nepal to finely balance its relations between India and China and extract the maximum mileage

Nepal’s disputation of its border claim in June last year, with India, came as a surprise to many, both due to the timing as well as the perceived assertiveness. Brought bluntly in the media, when India was engaged in a challenging situation with China, this led to an array of conclusions. The clichéd India – China balancing, also made its rounds in the intellectual circles. But facts are seldom that simple. The present endeavor seeks to take a closer under the skin look at Nepal’s strategic imperatives.

This Nation, of 29 million, 800 Km in length, and 90-150 km North- South, is traversed by hills and mountains, for 75% of its land mass. Nepal shares an 1850 km open border with India, and 1414 km boundary with China. Its demography is largely as a consequence of migrations from India and Tibet, with a small core of Newaris and Tharus who are indigenous.  80.3 % of the populace is rural and 19.7% reside in urban areas, 81.3% of whom are Hindu and 9% follow Buddhism. 75% of the total population is below 30 years of age.

The history of modern Nepal can be traced from the rise of the Kathmandu based Prithvi Narain Shah in 1769. Thereafter there were Thapa and Rana Rulers upto 1951. Consequent to the restoration of Monarchy by King Tribhuvan, in the 50s, Nepal has seen several forms of governance and ruling elites. In fact, there is inadequate appreciation of the turbulence and deprivation the common folk have suffered over decades, leaving Nepal among the Least Developed Countries of the world.

The state of economic and developmental neglect can to some degree be perceived by the tortured political developments in the country. Monarchy being re-established in 1950-51, there was a promise of a democratic system. Post the 1959 Constitution, general elections brought the Nepali Congress to power. This Government was dismissed by the King in 1960 and a new pro-monarchy Constitution promulgated in 1962. By 1979 the nation was plunged into economic chaos. A referendum in May 1980, led to political liberalization but retention of the 1962 Constitution. This being completely unacceptable to the political parties, in Feb 1990, a coalition of left and centrist parties demanded basic political reforms of the country, and launched an armed struggle. The nation now entered a stage of power struggle between the Monarchy, Left parties (Maoists) and other political parties. There were fresh Constitutions in Nov 1990, 2007,  and 2015. The Maoist insurgency that raged from 1990s took US assistance; a seven party and Maoist agreement in Nov 2005 (New Delhi); and a UN mediated peace accord in2006- for the Maoists to enter into full fledged democracy. In 2008 the UCPN (Maoists) were elected to power, royal rule came to an end and Nepal was proclaimed a Secular Democratic Republic. Communist leadership from 2008 till date has continued to be fraught with political upheavals. Several heads of State and PMs have changed and the political tumult and contentions continue.

The Indian and Nepalese, people have been intertwined historically for centuries. The multifaceted and intricate relationship to some degree can be understood, as Roti – Betiaur Dharam ka rishta. This in no way detracts from the deep fractures in the relationship that surface periodically vitiating the entire connection. The modern relationship is characterized by the treaty of 1950, which grants unparalleled rights to the citizens of both nations across  borders. It is difficult to find such a relationship anywhere in the world where 6 million Nepalese, live and work in India enjoying the full benefits of Indian citizens. The treaty also seeks to obviate the land locked limitations of Nepal by granting preferential rights, access to Kolkata port, and open national borders. 600,000 Indians also live and work in Nepal. The Indian connection encompasses almost all dimensions of Nepalese life. Significantly 50,000, including those under training, Gurkhas serve in the Indian Army at any point of time, with about 97,000 ex servicemen and 11,000 widows as Indian pensioners in Nepal. While the balance of trade remains heavily in favor of India, post a 1996 renegotiation, Nepalese exports have grown 11 times and bilateral trade has increased 7 times.

An enormous envelope of aid, trade, education, infrastructure, business and culture exists linked to India, with highest level joint coordination. Be that as it may, we must reboot and record the reasons for Nepalese dissatisfaction with India. The objections and resentment that rise and fall periodically center on.

♦   Perceived political interference and orchestration in national politics.

♦   A general big brother fixation, coupled with arrogance by India and Indians.

♦   1950 Treaty being largely beneficial to India, unequal to Nepal.

♦   Slow movement on projects, aid and assistance.

♦   Ability to enfeeble Nepal, as evidenced by the blockage to trade and transit in 1989 and 2015.

♦   Loyalties to particular sections on Nepalese populace.

♦   Nepali leadership and intelligentsia accuse India of viewing Nepal through outdated lenses, refusing to come to terms with the tectonic changes since 2015.

In a relationship of centuries, with free migrations across territories, and complex inter connected realities; it is also evident that familiarity breeds contempt. Let us however not wish away the sometimes club footed approach of India.

Nepal and China formalized their relationship, in 1955, the same year Nepal became a member of the UN. The relationship is centered on Panchsheel. China promptly entered into a border agreement with Nepal in 1960/61 and demarcated the border in 1963. It is today the second largest trading partner after India, and contributes the second highest FDI. In 2018  Chinese tourists exceeded Indian. It seeks to present a clean image, by extending, grants, lines of credit, interest free loans, and the promise of outdoing India in trade and transit. The fact remains, whatever the Indian interventions, China has been very active with leftist, Communist and Maoists in Nepal and the merger of all into the Nepalese Communist Party in 2018   is largely attributed to them. China seeking strategic influence has developed good momentum. A case in point is its offer of a road rail link through Tibet to the sea.  The Qinghai- Tibet rail line complete up to Shigatse, will soon reach Rasuwangadi, on the Nepal border.  That leaves only 100 Km to Kathmandu. China plans to transport Nepali products to Lanzhou, completing the trip in 10 days as opposed to exports via Kolkata which take up to 30 days. It also seeks to build rail connectivity up to Lumbini close to the Indian border.

China was definitely gifted some windows into Nepal. In 1965 the commitment to import arms only from India was revoked by Nepal and multiple agreements were worked out with China. When India and the US withdrew military aid to King Gyanindra in the period 2001 to 2008, China smoothly moved into the vacuum and became a supplier. Exploiting the entry they cemented ties with the agitating Maoists and ensured when the king was removed in 2008, that they had muscular ties with the communist political elites, and security agencies. Riding high, in 2015, as the blockade of goods and transit occurred due to the Madhesi agitations, and India’s perceived collusion, China struck a bonanza.

The distinctly singular strategic outcomes that China seeks in Nepal must engage our focus.

♦ China sees an opportunity to extend its strategic influence south of the Himalayas, as proximate to the Indian borders, as possible.

♦ While ensuring the loyal and committed support of Nepal on all international issues, it seeks to ensure Nepalese territory is not used for any activity inimical to China. Consequently, emasculation of the Tibetan refugee population (20,000) is demanded.

♦ By establishing relations with the leadership and security establishment, it seeks a role in decision making as well as execution.

♦ It aims to outclass all Indian economic advantages by air, land and rail linkages, liberal grants, participation in Belt and Road initiative, and winning over the populace by the success story of China.

♦ Seeks to create a niche, by cultural, educational and linguistic outreach.

♦ Seeks to debunk India and rein in the Indian influence.

The Lipulekh boundary issue that was agitated in May 2020, is not a new contention. The area at the India- China- Nepal

tri-junction, (Kalapani, Lipulekh, Limpyiyadhura), has been unresolved for decades, and the Nepalese claims go back to the 1815 treaty of Sagauli. Nepal has been sensitive to Indian talks on this issue with China, without their participation. As a consequence of the Indian road through Lipulekh, the 2nd Amendment to the 2015 Nepalese Constitution was triggered, and a revised map published by Nepal, laid claim to the whole area. India registered a border dispute and Nepal has sought talks. Simple enough. But it is neither simple nor enough.

Despite several initiatives by the present Indian Government, the Nepalese PM, KP Sharma Oli (a second time PM), has chosen an ultra nationalistic approach to governance. He is under severe threat for leadership from the powerful Maoist leader, ideologue, and previous PM, Pushpa Kumar Dahel – Prachanda. The Indian road gave an enormous nationalistic opportunity to PM Oli, to gain popularity and detract from his dismal performance domestically. Oli like Prachanda, is one of the dedicated communists wooed by China. He has met President Xi on several occasions, and is signatory to the 14 point joint agreement with Xi in Jun 2018. President Xi has visited Nepal in 2019, a major signature event, where Nepal and China acknowledged strategic partnership and concluded 20 Agreements. Oli as a consequence of his ultranationalism is also respected for his anti India stance during the 2015 transit blockade.

The Nepalese stance on the border would have evoked much acclaim in China. But international affairs are complex and unforgiving. Unlike India, China can function with Nepal in an “expeditionary” manner, since there are no human connectivities, nor complexities of history, culture, and demography. A pragmatic view however informs us that despite Nepali leadership’s posturing, it is unthinkable that 6 million Nepalese would live and work in China or Tibet, or 50,000 Gurkhas serve in the Chinese PLA. Further balancing India with China, if seriously considered as policy is perilous. States adopting such a path cannot control the escalation matrix this sets off. With the proclivities for misperception, and speed of thought and action in the 21st century unintended consequences manifest rapidly. With populations intertwined, geography and economy integrated India cannot be balanced out.

China despite its approach and window dressing is an aggressive power. The Chinese bad news emerges sometime after its honeymoon. This is amply evident in Malaysia, Sri Lanka, Maldives and ASEAN and Africa. It took time but the disenchantment with Chinese methods has shown up. Whether it is the debt trap, commercial and strategic exploitation, or indeed the penchant for Chinese males to pick up wives, the bad taste has prevailed. Chinese outreach is configured and oriented in an aggressive, self proclaiming manner and its true nature can be occluded for brief periods only. While it may waltz with Nepal now, it will progressively seek ascendancy. As Xi chooses to seize this international moment globally, China and Nepal will also need to contend with the priorities of the US and UK in the region.

Nepal’s greatest challenge is to meet the existential needs of its population. The enormous youth bulge, seeks legitimate socio economic progression, and is not in the mood to wait indefinitely. The agitations, insurgency and all the decades of struggle, have raised an expectancy that needs to be fulfilled. Patriotism is great, but seldom fills stomachs, and at best can serve as a band aid, if not backed with economic opportunities and outcomes.

Consequently, this is a sensitive strategic moment for Nepal. It must seek economic advantages from either neighbor, to its best advantage. Strategic license is another matter. The Indian connectivities are too deep-rooted to be packed away, without great disadvantages to Nepal. Undoubtedly both Nepal and India must re energize their mutual appeal, and this must be done with an open head and heart. Nepal will need to find a calibrated approach to China. The Northern neighbor has shown scant respect for emotions, sensibilities and finer nuances, when these compete with its strategic design. The true balancing that Nepal needs to undertake is between its growing economic needs, and professed strategic space. Bilateral relations with India and China distinctly frame worked, may be the way forward. As a famous Nepali proverb goes, “opportunities come but do not linger”, the present moment offers opportunity to Nepal.