Indiaís outreach to Nepal in recent days has hit all the right notes. It has managed to capture the imagination of Nepalese people and politicians alike. The recent visits of the Indian prime minister, Narendra Modi, and the external affairs minister, Sushma Swaraj, to Nepal were an important opportunity to recalibrate Indo-Nepalese ties and they have succeeded in doing precisely that. Modiís visit to Nepal in early August was the first bilateral visit to Nepal by an Indian prime minister in 17 years, an example of negligence that is as disconcerting as it is incomprehensible. Nepalese polity, cutting across party lines, had welcomed the assumption of power by Modi, with most expressing hope that Nepal would be a beneficiary of Modiís developmental agenda. And Modi has reached out to that country promptly as a sign that he is serious about prioritizing Indiaís South Asia policy.
Nepal, too, reached out to Modi in an unprecedented manner ó the prime minister of Nepal, Sushil Koirala, breaking protocol and receiving Modi at the airport, giving Modi a 19-gun salute on his arrival, the Nepalese parliament inviting Modi for an address, the first by a foreign head of state to that body after 1990, with the people of Nepal giving him a rousing public welcome. Modiís speech at the Nepalese parliament was a graceful reflection on the trials and turbulence that have shaped Indo-Nepalese ties over the last few years with a promise of a change of course in the coming years. Although the signing of the power trade agreement was deferred, Modi concluded three memoranda of understanding. These included one on the 5600-MW Pancheshwar project, the first report of which was drafted by India as far back as 2002. The other two were a Rs 69 million grant to Nepal for the supply of iodized salt and cooperation between Nepal Television and Doordarshan. Modi announced a 10,000 crore (Nepalese rupees) line of concessional credit to Nepal. Most significantly, Modi has promised prompt implementation of Indian projects in Nepal, a cause of needless irritation in this bilateral relationship as delay is seen as symptomatic of Indiaís lack of seriousness by most Nepalese people.
The groundwork for Modiís visit was done during Sushma Swarajís visit a few days earlier, when she managed to convey the right message by settling a long-pending issue. That is, she promised a review of the 1950 Treaty of Peace and Friendship within two years, on the basis of recommendations from a group of eminent persons from both countries. She also co-chaired the Nepal-India joint commission that met after a gap of 23 years, and reviewed bilateral ties as a whole. The Modi government now has an opportunity to reshape the contours of New Delhiís relations with Kathmandu and it should lose no time in doing that, especially as India seems to be losing ground in Nepal to China.
ďA yam between two rocksĒ was how the founder of Nepal, Prithvi Narayan Shah, described the Himalayan kingdom, underlining the pivotal geo-strategic location of Nepal, land-locked between China and India. In 1955, Nepal established diplomatic relations with China, recognizing Tibet as part of China in 1956. Since the mid-19th century, Tibet, rather than Nepal, had served as Indiaís buffer with China. The role of this buffer passed on to Nepal after the Chinese annexation of Tibet. It became imperative for New Delhi to deny China direct access to Nepal because of the vulnerability of Indiaís Gangetic plain containing critical human and economic resources. For China, the growing influence of India had grave implications for its security, especially as regards Tibet. Thus, preserving the balance of power in southern Asia in its favour and securing Nepalís active co-operation to prevent its rivalsí use of the country for anti-Chinese activities became principal strategic objectives of Beijingís Nepal policy.
The 1950 Treaty of Peace and Friendship between India and Nepal enshrined the close relationship between the two nations (including close co-operation on trade, transit, defence and foreign affairs) and constrained Chinese options vis-ŗ-vis Nepal. As Chinaís economic and political profile rose, it gradually began to increase its influence in Nepal, and Kathmandu, wanting to counterbalance India, was keen to leverage China in its dealings with New Delhi. By supporting Nepalís position during most disputes between that country and India, China was able to project itself as a benevolent power compared to India with its supercilious attitude towards its smaller neighbours. Nepal signed an arms pact and a secret intelligence-sharing agreement with China in 1988 which elicited strong reaction from New Delhi, leading to the imposition of an economic blockade on Nepal in 1989-90. In spite of this, Sino-Nepal ties continued to evolve with Nepal importing Chinese weaponry and cultivating extensive military co-operation in a move to reduce dependence on India.
Chinaís interests and presence in Nepal now go far beyond the Tibet issue. China is projecting its Ďsoft powerí in Nepal by setting up China study centres to promote Chinese values among a Nepalese populace that is otherwise tied culturally to India. These centres are emerging as effective instruments in promoting Chinese perspectives on key issues concerning Nepal. China is constructing a 770-kilometre railway line to connect the Tibetan capital of Lhasa with the Nepalese town of Khasa, a move that would connect Nepal to Chinaís national rail network. China is also constructing a 17-km road through the Himalayas linking Tibet to the Nepalese town of Syabru Besi, which will not only connect Tibet to Nepal but, when completed, will also facilitate the first direct Chinese land route to New Delhi. China views Nepal as a vital bridge to south Asia. It plans to extend the railway line from Lhasa to Shigatse, Tibetís second-largest city, to as far as Kathmandu, and to build a new airport at Pokhara, Nepal.
By projecting India as a factor of instability and an undue beneficiary of Nepalís resources, China has used Nepalese sensitivities vis-ŗ-vis Indian influence to good effect, thereby further undercutting Indian influence in Kathmandu. Indiaís overwhelming presence remains a source of resentment towards India in Nepal. China appears attractive because it can claim that, unlike India, it is not interested in the internal affairs of Nepal. China has demanded from the Nepalese government that it be given the same privilege as India in identifying the projects in need and in channelling funds through district bodies without going through the government.
With the drafting of a new constitution stalling in Nepal, and political and economic instability causing more uncertainty, India is viewed as being part of the problem as it is seen as being too involved in Nepalís domestic politics. The political uncertainty in Nepal has fuelled anti-Indian sentiments and allowed China to enlarge its presence, with Beijing even offering lawmakers financial assistance in drafting the new constitution. The Himalayan kingdom is going through a crisis and India is being blamed for pulling strings from behind the scenes. It is this insecurity that China has been able to exploit in Nepal to serve its own interests ó a trend that is likely to persist in the near future.
The Modi government has shown a willingness to treat Nepal as an equal sovereign state by showing an interest to explore the possibility of a transparent review of the 1950 Treaty of Peace and Friendship and joint developmental projects in the realm of energy and infrastructure. It will now have to prove that this is not a fleeting interest in Nepal and that Modiís visit is just a beginning.