New Nepal government to face tough foreign policy challenges

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CPN-UML chairman Khadga Prasad Sharma Oli (left) shakes hands with the chairman of the Communist Party of Nepal (Maoist Centre), Pushpa Kamal Dahal, aka Prachanda, during a news conference in Kathmandu on December 17, 2017.  Photo: Reuters / Navesh Chitrakar

Not many political developments in Nepal make headlines in international media. The recently concluded elections for the House of Representatives and provincial assemblies, however, drew a lot of international attention and deep concerns.

The reason was that the left alliance, which is ideologically close to the Communist regime China, had a landslide victory in the national election and is preparing to form a new government. If the alliance remains intact, Khadga Prasad Oli, chairman of the Communist Party of Nepal (Unified Marxist-Leninist) or CPN-UML, will lead the new government, where he will face immense foreign-policy challenges.

Though Nepal’s communist parties have transformed into democratic parties, their rise always becomes a matter of concern for both India and Western countries.

Mainstream Indian media have reported that the left alliance’s victory will further solidify China’s footprint in Nepal, which is partially true. They are also worried that India’s influence will further dwindle in Nepal while China makes wide inroads. This perception was developed because the media and intelligentsia in New Delhi believe that Oli, who served as prime minister from October 2015 to August 2016, is close to Beijing. Such perceptions arose in New Delhi for at least three reasons.

First, during the Nepal-India border blockade in 2015, Oli stood firmly against it. Indian media, think-tanks and officials believe that this created anti-India sentiments in Nepal and set up a favorable environment for China to increase its influence.

Second, Oli signed a trade and transit agreement with Beijing that aimed to end India’s monopoly in the supply system of day-to-day essentials. Until 2015, Nepal had such an agreement only with India, but now it has been diversified.

Third, Oli has publicly criticized Indian interference in the internal political affairs of Nepal. Even after the elections, Oli has said that some foreign forces were trying to stop him from taking leadership of a new government, clearly hinting that he meant India.

For half a century, India enjoyed exclusive influence in Nepal, but that has been challenged by China over the past decade. That is why there are fears among media, government officials and policymakers that the emergence of leftist parties will provide more room for China to advance its influence.

A nuanced study of a couple of developments that took place during the past two years shows that despite pressure from both of its giant neighbors, Nepal has gradually adopted a strong and independent foreign policy. It is almost certain that in the coming years, the government in Kathmandu will face further pressure from both India and China, so it needs a strong leadership to withstand this.

On May 12, 2017, Nepal decided to join China’s Belt and Road Initiative  despite pressure from India not to be a part of it. India cited issues related to security and sovereignty to suggest that Nepal not sign on to the project. The next challenge for Nepal is to select and execute projects under the BRI in an independent and prudent way that will be beneficial for the country, while learning lessons from other South Asian countries. Intensive and careful homework is required before selecting and implementing the projects.

Nepal is heavily dependent on India for trade, investment, day-to-day needs and employment. Their open border and deep-rooted social and cultural relations are unique. The only option left for both countries is to take the relationship to a new level

When it comes to relations between Nepal and India, both countries must work to complete bilateral economic projects on time. Many hydropower and connectivity mega-projects remain unfinished. With the purpose of removing the hurdles holding back implementation of such projects, a joint mechanism has been formed that should expedite the work.

There have been delays in initiating two big hydropower projects, West Seti and Upper Karnali, and there are dozens of other bilateral projects that are proceeding at a snail’s pace.

Nepal is heavily dependent on India for trade, investment, day-to-day needs and employment. Their open border and deep-rooted social and cultural relations are unique. The only option left for both countries is to take the relationship to a new level.

Adopting balanced relationships remains an uphill task that South Asian countries are facing. New Delhi may be wary of growing Chinese investment in Nepal but it cannot prevent it.

Nepal is not the only neighbor of India where Chinese investment is rapidly growing. Recently, Maldives signed a free-trade agreement with China, Bangladesh is rapidly embracing the BRI project, and China has signed an agreement on a 99-year lease of Sri Lanka’s Hambantota port.

Seeking a balance

Like Nepal, other South Asian countries are struggling to maintain balanced relationships. All these countries are trying to expand economic cooperation with China while taking India into their confidence. India is of the view that growing Chinese projects in neighboring countries will affect its security, so another challenge of South Asian countries is to reassure New Delhi on its genuine security concerns.

As India cannot fulfill the development aspirations of those countries, Chinese investment in the region will increase. South Asian countries, however, must work to maintain a delicate balance between India and China.

The left alliance won the Nepalese election with the slogan of peace, development and prosperity. To bring prosperity and development to a resource-constrained country like Nepal, the alliance will have to secure support from the international community.

Therefore, the new government will need to make an honest effort to maintain cordial relations with the international community. For its part, the international community should view the recent election in Nepal is an encouraging development. For a long time, the global community has called for peace, stability and development in Nepal.

Both India and China are saying that they want to see peace and stability in Nepal, and now here is hope for a new stable government in Kathmandu.

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