Does China’s increasing influence make any big change in Nepal-India relations?

Nepal and India have cordial bilateral relations and they share common cultural elements, traditions, and religion. The two countries established diplomatic relations on June 17, 1947. In principles of peaceful coexistence, sovereign equality, and understanding of each other’s aspiration and sensitivities, Nepal and India not only have relations through treaties and agreements between the two countries, but also have people-to-people contact and free movements of people between the countries. At the political level, Nepal and India have good relations, with frequent high-level visits by the leaders of both the countries. Recently, for example, Prime Ministers exchanged visits within a short period of time. This illustrates the importance of India-Nepal relations at the political level.

Almost all Nepali Prime Ministers visited India after they assumed office. Reciprocally, an invitation from Nepal’s then Prime Minister, Sushil Koirala, led to an official visit of Indian Prime Minister Narendra Modi to Nepal in August 2014. This was a historic visit by a prime minister of India to Nepal, after 17 years, which reflected the commitment of the newly formed Indian government to enhance India’s relations with neighbouring countries. This indicates the importance of Nepal’s relations to India after the change of leadership in India in response to China’s increasing development assistance and engagement in this region.

An analysis of more frequent Indian engagements in Nepali affairs, an example of which is the third visit of Indian Prime Minister Modi in a span of three years, indicates that its diplomatic course and policy are shifting towards Nepal. A review of ongoing engagements of Nepal’s friends in Nepal’s development reflects that China-Nepal-India trilateral relations are becoming more viable than before.

Currently, governments of Nepal and India are led by parties with different political ideologies. But, Nepal and China have communist governments. A basic assumption is that Nepal faces challenges in maintaining balanced relations with both the neighbours in this condition. Due to the presence of communist government, some scholars predict that Nepal will incline more towards China, which India would perceive as a security threat. But irrespective of the ideology of ruling parties here, China always supports Nepal government as well as its decisions.

Instead, India’s diplomacy is now slightly changed and has a political tone. But still, cultural factors and open borders definitely are strong influences. Therefore, it is likely that the relations among three countries will grow stronger than before in the upcoming days.

For Nepal, India has been a key development partner. India had been supporting Nepal not only in development projects, but also in political affairs during the insurgency and various mass movements. India has been providing economic assistance to Nepal in different sectors, such as infrastructure development, capacity development of human resources, and initiation of large and intermediate projects. Nepal does not have direct contact to seaports, so its trade depends mostly on the Indian market. India and Nepal have a bilateral treaty on trade and transit, and agreements of cooperation to control unauthorised trade.

Due to geographical structure and complication, there are not many options or routes for trade and transit between Nepal and China. Only the Rasuwagadhi-Kerung border point has been upgraded to the international standard after the 2015 earthquake, which damaged Tatopani transit point and border link roads.

Since the earthquake and the Indian border blockade in September 2015, Nepal has become closer to China as it has tried to find alternatives to the trade and transit activities with India, allowing China to step into the Nepali market that was, in past, India’s monopoly. Further, it is believed that Beijing is looking into the possibility of connecting Kathmandu to Lhasa in Tibet via railways at an estimated cost of $8 billion through the One Belt, One Road initiative. China’s activities have been steadily expanding in Nepal after Kathmandu’s support for OBOR materialised. This happened despite India’s stiff resistance to OBOR. So, for both the neighbours, Nepal is an important friend for not only their economic interests, but also in multilateral and regional forums.

China’s engagement in South Asia and Nepal contribute to more assertive diplomacy and friendship between Nepal and India. Meanwhile, Nepal’s government aims at a balanced foreign policy towards its neighbours. According to the Constitution of Nepal, foreign policy of Nepal is guided by abiding faith in the United Nations and the policy of nonalignment. On the other hand, Nepal’s ties with India are incomparable to any other relations given their historic background. Therefore, any major change in the trilateral relations is unlikely.

Karki is post-doctoral research fellow at Institute of Global Studies in Tokyo University of Foreign Studies, Japan.

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