Nepal: A New Theatre for Regional Rivalry
| Vaishali Basu Sharma, Thought Leader, Delhi - 27 Nov 2020

In keeping with current endeavors to ease palpable tensions between India and Nepal, Indian Foreign Secretary  Harsh Shringla is paying an official visit to Kathmandu to meet his counterpart Bharat Raj Paudyal on November 26-27, 2020. This was preceded by the visits of Army Chief General Manoj Mukund Naravane and of Samant Kumar Goel, the chief of India’s Research and Analysis Wing (R&AW). Albeit this indicates a desire by authorities to normalize the strained relations, the fact is that these steps way overdue and reflexive reactions to deflect expanding Nepal China relations. The question is whether Nepal intends on harmonizing equitable relations with its two Asian neighbours, or does it intend to play one against the other in a dangerous game of geopolitics, thus becoming a theatre of regional rivalry?

India by not being as aggressively inclined in signaling the preeminence of Nepal in its neighborhood, has vacated space for a bewildering surfeit of Chinese aid. More troubling is China’s overwhelming role in the delineation of Nepal’s attitudes toward India. Unless Nepal does a course correction, it risks losing its ability to take sovereign decisions.

By Vaishali Basu Sharma, New Delhi   

‘Zone of Peace’:

“Nepal situated between two most populous countries in the world wishes within her frontiers to be enveloped in a zone of peace.” This idea was formally proposed by the Late King Birendra of Nepal in 1973. In mooting the concept of Nepal as a zone of peace the Late King had rejected the concept of his country as a buffer state. But in search for socio-political stability Nepal has throughout faltered in maintaining even handed relationships with either India or China. And at no point have the relationships been so contentious with India, or as conciliatory with China as they are at present.

Chinese Encroachment into Nepalese Territory:

Lately it was revealed that Chinese army and border police have constructed buildings in Nepal’s Lapcha-Limi, Humla region and are occupying the same. This incident is not without precedent. A document issued by the Survey Department of the Ministry of Agriculture in 2017 shows that China had encroached upon 36 hectares of Nepalese territory at 10 places along its northern border. The reports also alert that the Chinese Government is expanding its road construction activity in the Tibet Autonomous Region (TAR) and diverting the flow of rivers which act as a natural boundary.

The report alerts, “If this continues, hundreds of hectares of our land could go to TAR.” These and the latest reports of encroachment in the Lapcha Limi area have been firmlyrefuted by the government of Prime Minister K. P. Sharma Oli, to the extent of contending that no such document on Chinese expansion into Nepalese territory exists. The fact remains that the document exists and lawmakers in Nepal have been raising the issue in the Parliament questioning the apathy of Oli’s government on the matter.

Several news reports bring to light incidents of Chinese land grabbing in the Nepalese districts of Humla, Sindhupalchow, Gorkha, DharchulaandRasuva. In some villages in these districts the Nepalese government doesn’t have active control. The issue has not even been raised with the Chinese side despite the areas plainly being part of Nepal according to all official maps. Aconsistenttactic to squash all voices raising concern about China compromising Nepal’s territorial integrity is in place.           

On August 14 Nepali journalist Balaram Baniya, who initially exposed Chinese encroachment in Rui village, of Gorkha district was found dead under mysterious circumstances.

China attempts to Cultivate Cultural & Security Ties with Nepal:

The Chinese attempt to encroach is not limited to land grabbing, it expands into the realm of influencing the intelligentsia of Nepal. Some years back it was reported that over two dozen China Study Centres (CSC) have emerged in Nepal – strategically sited in southern Nepal along India’s border these CSC are engaged in ‘propagating subjects of Chinese culture, traditions, teachings and economy to the population in Nepal.’ By last count the number of China Study Centres stands at 35. A growing number of Chinese scholars are following and studying Nepalese affairs. In fact, the China Study Centre based in Kathmandu was commissioned a study to find out why Nepalis join the Indian Army.

It is a systematic attempt to persuade the civil society and campaign that there are deep socio-cultural relations between the two nations.The Nepal-China Institute of Social Relations has launched a magazine called ‘Nechisora’ with the stated aim of cultivating the mutual understanding between Nepal and China. A constant themein its narrative is to emphasize that China treats Nepal as an equal, and conversely undermine the enduring and extensive ties with India as inequitable.

Beijing’s interest in Nepal is manifold. Not confined to economic cooperation, it mainly seeks to reduce the permeation of Indian culture in Nepal. More importantly, besides civil society and academia, China has been cultivating ties with the full spectrum of political parties and Nepal’s defence forces. Several Nepal politicians have been appointed office-bearers of Chinese government sponsored NGOs for the redevelopment of Lumbini, which it plans to control as the focus of a “Buddhist tourism circuit.”In order to undermine cross border activities of ‘Free-Tibet’ activists, and to gain control of the Nepal-Tibet border, it has also begun to invest heavily in Nepal’s security forces. It has committed approximately Rs. 2.5 billion military assistance to the Nepal Army.

China’s Escalating Political Interference in Nepal:

After some private Indian news channels aired reports about China's ambassador to Nepal Hou Yanqi Nepal has stopped the transmission of these news channels, except Doordarshan. According to several media reports Chinese Ambassador is very popular in Kathmandu and “part of her job, of course, is to wean Nepal away from its civilizational embrace of India.”Violating diplomatic norms, and keeping all the cards close she remains in touch with the Nepal Army chief, local NGOs, youth forums and trade organisations to prevent Khadga Prasad Sharma Oli’s Nepal Communist Party (NCP) from losing power.

To prevent the Oli government from collapsing because of internal rifts she persuaded meeting senior NCP leaders like Jhala Nath Khanal and Madhav Kumar Nepal both former prime ministers, and aligned with the rival faction led by Prachanda. It is speculated that she was the draftswoman behind controversy around an 80-km road built by India as a reprieve for PM Oli, after which he issued a new political map for Nepal to consolidate his position and his popularity soared. Nepal justified including Kalapani, Lipulekh and Limpiyadhura, in its new map as a retaliation to the inauguration by India of an 80 km-long road connecting to the border with China at the Lipulekh pass. The Chinese discontent was clearly reflected in Nepal’s reaction in issuing the new map.

Reorientation of Strategic Ties:

The tremendous increase of Chinese investments in the Himalayan country was to a large extent the result of restrained foreign relations between the India and Nepal, in the period after the Maoist insurgency. India’s then policy makers held back in their assistance to Nepalese policy, which was transitioning from the end of monarchy and a People wars into Democracy. Until the adoption of the new Constitution in September 2015, Kathmandu went through a difficult political process. Protest movements along the Indian border by Madhesi groups and the blockade in cross-border trade led to pessimism towards India amongst Nepali civil society and government. At a time when the Nepalese state sought economic stability and growth, the Chinese intervened but are now taking over as an overwhelming extractive force. 

The 2015 earthquakes further opened critical spaces of post-disaster reconstruction for Chinese interventions in Nepal. A clear sign of its strategic reorientation was the signing of the ‘Joint Statement between the People’s Republic of China and Nepal,’ during Nepalese Prime Minister Khadga Prasad Sharma Oli’s visit to China in March 2016. Soon after Kathmandu canceled a state visit to Delhi by President Bidhya Devi Bhandari, signaling its frustration with India. Then in May 2017 Kathmandu joined Xi Jinping’s flagship Belt and Road Initiative. Following this China’s financial aid and infrastructure support to Nepal stepped up massively.

Nepal is playing a dangerous game of selectively prioritizing border issues to extract political and economic value. With India, it vociferously raised objection to Kalapani, Lipulekh and Limpiyadhura’s status as Indian territory and unilaterally changed its official maps. With China however, it a has happily surrendered land along border regions in exchange for professed infrastructural development. The Chinese have been developing an array of infrastructural projects along the bordering districts like Rasuwa. Notwithstanding the developmental claims of the Nepalese government, these projects in Nepal are managed by Chinese contractors and have generated uneven experiences for local Nepalese and Tibetan refugee populations. Chinese workers form their own ghettos in the developmental reserves and are quite regularly at odds with the local population.

With democracy still in its formative years and a vacuum of local governance that persists across Nepal, economic development has been set as a parameter for successful state formation. To enforce its viability as a legitimate stable entity the present Nepalese government has sought to deliver on hydropower and transportation infrastructure, which in turn is linked to cooperation with China. But this perspective ignores the uncompromisingly exploitative practices of Chinese developmental efforts and reflects unequal power relations. The bulk of China’s FDI to Nepal is specifically targeted for hydropower development.

Chinese investment in Nepal’s hydropower sector increased the bargaining power of Nepal’s ruling elite vis-à-vis India. Aflush with subsidized state financed loans, Chinese contractors are currently involved in the construction of more than 17 hydropower projects across Nepal. These enclaves of infrastructure production reflect the consolidation of Chinese state into Nepalese territory. That Chinese investment will materialize into a developed future and support Nepal’s state-making agenda are unlikely.

China’s geopolitical gamesmanship is aimed at shifting Nepal’s alliances and its historically “special relationship” with India. If sections of the strategic community in Nepal believe that Chinese intrusiveness is imagined by India, they surely cannot discount the occupation of Tibet as abstract! The Nepalese polity should heed Tibetan President Lobsang Sangay’s forewarning of the Chinese intent to fulfil Mao Zedong’s ambition of acquiring the so-called five fingers Ladakh, Nepal, Bhutan, Sikkim and Arunachal Pradesh after the gaining the palm that is Tibet.

China’s principal goal in Nepal is to build and firm up its influence by undercutting India’s pre-eminent role in the Himalayan country manifest by our people to people, economic, infrastructural, ties. Chinese infringement of Nepal will continue to increase in juxtaposition to increasing Tibetan unrest.

Until recently the 1,800-kilometer Indo-Nepal open border with its 37 motorable entry points was feted for its unrestricted movement of people on both sides – as well as their socio-cultural affinity. Citing the pandemic, and in view of the dispute over Lipulekh, the Nepalese government sealed the border and the commute of people from either side has come to a standstill. Along with the Armed Police Force (APF), it has deployed additional security personnel along border points. According to local reports the security personnel along the borders are being provided with amenities and apparatuses by the Chinese to ensure that the border with India remains sealed.

This has affected the both the disadvantaged Nepalese who bought cheaper goods especially food items from the Indian side, and the traders along the border towns, for instance Banbasa (Uttarakhand), Gorakhpur (Uttar Pradesh), Jainagar (Bihar) whose main customer base was from Nepal. This border sealing has affected the livelihoods of an estimated 279,000 Nepali seasonal migrant laborers who work in India and regularly cross the border to and from work. Nepalese ex-serviceman, who had worked with the Indian army have been unable to draw their pensions from banks on the Indian side, because of the unreasonably strict sealing of the border by Nepal.

India & Nepal – A case of Natural ties:

India has long provided infrastructural support and development assistance to Nepal. While the advantage for India lies in its tremendous soft reach into India, it is losing ground to China’s zealous outreach in technology and infrastructural aid. For instance, Huawei and ZTE are involved in Nepal Telecom’s mobile phone capacity. Eager to deliver, the Nepalese government remains unconcerned that both these companies have links to the Chinese government and are universally designated as national security threats. India’s involvement in Nepal’s social and education sectors has been longstanding and instinctive, but these consistent humanitarian efforts have lost out in diplomatic space to China’s frenzied approach to infrastructure development ventures.

With a view to reconnect old bonds between 2014 and 2019 Prime Minister Narendra Modi visited Nepal thrice. One successful partnership in the field of energy has been the launch of South Asia’s ‘first cross-border oil pipeline,’ the Motihari-Amalekhgunj project which enabled fuel transport from India to Nepal. Keeping aside differences, India provide essential medicines to Nepal during the global healthcare crisis triggered by the coronavirus outbreak. In September Indian Railways delivered two modern Diesel-Electric Multiple Unit (DEMU) train sets to Nepal Railways for the Jayanagar (Bihar) – Kurtha (Dhanusa district, Nepal) railway link.

Despite Indian overtures, Oli’s stance offensive towards India continued as he declared that “coronavirus from India is more lethal than the Chinese and Italian ones.” Nepal’s leaders are outrightly defending China, be it on the virus, border encroachment, debt trapping or over quelling the grievances of nearly 20,000 Tibetan refugees in their country. They are gravely unconcerned about the implications for their country’s sovereignty. The diplomatic influence China now exerts over Nepal is so intense that Nepalese police regularly detain Tibetans who try to cross the Nepalese border into India.

India by not being as aggressively inclined in signaling the preeminence of Nepal in its neighborhood, has vacated space for a bewildering surfeit of Chinese aid. More troubling is China’s overwhelming role in the delineation of Nepal’s attitudes toward India. Unless Nepal does a course correction, it risks losing its ability to take sovereign decisions.

Vaishali Basu Sharma is an analyst on Strategic and Economic Affairs. She has worked as a Consultant with the National Security Council Secretariat (NSCS) for nearly a decade. Vaishali is now associated with Policy Perspectives Foundation. She tweets at @basu_vaishali

Images – 1 Ambassador of the People’s Republic of China, Hou Yanqi (left) shakes hand with Prime Minister KP Sharma Oli. Photo: MoFA – Credit -

Image - 2 Author Vaishali Basu Sharma 

Images - 3 This document issued by the Survey Department of the Ministry of Agriculture, Nepal in 2017 shows that China had encroached 36 hectares of Nepal’s territory at 10 places along the northern border. Source: Dept of Survey /


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