Indo Nepal Relation: Time to Review By Maj Gen AK Chaturvedi (Retd)

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Hindu and Buddhist traditions in Nepal go back more than two millennia. In Lumbini, Buddha was born, and Pashupati Nath temple in Kathmandu, is an old and famous Shiva temple of Hindus. Tantric traditions are deep rooted in Nepal, including the practice of animal sacrifices. In fact these cultural ties bind India and Nepal together.

The Kingdom of Nepal also known as the Kingdom of Gorkha was a Hindu kingdom formed in 1768, by the unification of Nepal by King Prithvi Narayan Shah, a Gorkhali monarch of Rajput origin from India. It continued for 240 years until the abolition of the Nepalese monarchy in 2008.

The Gorkhas were defeated by the British East India Company in the 1814–16 Anglo Nepalese war and were made to cede certain territories under the 1816 Sugauli Treaty. Post the treaty, Nepal had generally maintained a peaceful and friendly relations with the East-India company. The friendship helped The East India Company, when Nepal during the First Battle of Indian Independence in 1857 sided with the East India Company to crush the rebellion. On 21 Dec 1923 a treaty was signed between Great Britain and Nepal. The treaty declared Nepal as an independent and sovereign nation.

Independent India and Nepal initiated their relationship with the signing of 1950 Indo Nepal Treaty of Peace and Friendship and thus freshly defined security relations between the two countries, and an agreement governing both bilateral trade and trade transiting Indian territory. The 1950 treaty, stated that “neither government shall tolerate any threat to the security of the other by a foreign aggressor” and obligated both sides “to inform each other of any serious friction or misunderstanding with any neighbouring state likely to cause any breach in the friendly relations subsisting between the two governments.” These accords cemented a “special relationship” between India and Nepal. The treaty also granted Nepalese the same economic and educational opportunities as Indian citizens in India, while accounting for preferential treatment to Indian citizens and businesses compared to other nationalities in Nepal. The Indo-Nepal border is open; Nepalese and Indian nationals may move freely across the border without passports or visas and may live and work in either country. However, Indians are not allowed to own land-properties or work in government institutions in Nepal, while Nepalese nationals in India are allowed to work in Indian government institutions, except in some states and some civil services; IFS; IAS and IPS. After years of dissatisfaction by the Nepalese government, India in 2014, agreed to revise and adjust the treaty to reflect the current realities. However, the modality of adjustment hasn’t been made clear by either side so far.

End of Monarchy– Nepali democracy has experienced many trials and travails over the past two decades. Multi-party democracy was established in 1990, but it was challenged by a Maoist insurgency that began in 1996. In 2005, the then-king ousted the democratic government in a royal coup, claiming he needed emergency powers to fight the rebels. This led to a rapprochement between the Maoists and other political parties, and in 2006, popular street protests forced the monarch to step down, paving the way for elections to a Constituent Assembly, tasked with drafting a new constitution, in 2008. Political disputes, delayed the constitution-drafting process. Nepal finally promulgated a controversial new constitution, adopting secularism and federalism.

Importance Of Nepal in India’s Strategic Matrix

Nepal is sandwiched between India from West, South and East and Tibet Autonomous Region (TAR) of China from North. The terrain of Nepal is such that from an altitude of 70 meters from MSL in South it rises to an altitude of 8884 meters in North. With Tar it is connected by 28 passes out of which only three are all weather. It has an open border with practically no obstacle to separate her from India. There are a number of rivers which originate in Nepal and flow into India and there are few which originate in TAR and as such Nepal is middle riparian state and India is lower riparian state. Important of these rivers are Karnali and Arun. Both these are tributaries of Ganges which flows in Bangladesh before emptying in the Bay of Bengal. The length of the border between India and Nepal is 1751 km. There are three boundary disputes with India (more about these in next section). In Madhes region there has been certain demographic changes (12-13% population now Muslims) which has led that area to become a hot bed for ISI sponsored threat. Also with the rise of Maoist in Nepal there linkage with the left wing extremists of Bihar, Uttarakhand cannot be ruled out.

But major threat is from assertive China more than one ways. Late Chairman Mao Zedong in 1930 itself gave the concept of five finger based strategy for the security of China and Nepal happens to be one of the fingers (more about it later). That is why China always considers Nepal as a bridge to her strategic interests in South Asia  rather than a buffer between India and China. Some of the issues of concern are following:-

  • River water diversion– At least three major river/ river systems Koshi (Arun) in the East , Gandaki in the Centre and Karnali in the West originate in TAR. Any kind of diversions from these rivers/ damming them will directly affect the water availability in Ganges. Although,  United Nations Convention-1997 on Non-Navigational Uses of International Watercourses is one international instrument that specifically focuses on shared water resources. It established two key principles to guide the conduct of nations regarding shared watercourses: “equitable and reasonable use” and “the obligation not to cause significant harm” to neighbours. If this convention is followed in letter and spirit that China would not steal water but China is not a signatory of this convention. As such there is always a fear that hydro-electric projects executed in TAR will have a bearing on the water availability in the Ganges.
  • The potential of China using Nepal to have access in the central sector is well within the realm of probability. In case China uses that option the heart land of India would be directly impacted and the threat would be a substantial one. Incidentally recently China has deployed a Surface to Air Missile near a lake which is part of Kailash Mansarovar. Such a deployment confirms the Indian apprehensions about the criticality of the Central Sector.
  • An unstable Nepal may lent itself for being used up to cause a threat to India- therefore it would be in India’s interest, that Indo Nepal relations remain cordial, on even keel and such that Nepal feels Confident of Indo- Nepal relations.
  • India needs to be ready to deal with Nepal adopting policies which could be detrimental to the security interests of India.

Boundary Disputes

Map-1: Lipulekh Pass and the disputed Area

Despite the close linguistic, marital, religious and cultural ties at people-to-people level between Indians and Nepalese, since late 2015 political issues and border disputes have strained relations between the two countries with an anti-Indian sentiment growing amongst the government and people of Nepal. Further, because of border dispute between the two countries, a boundary agreement hasn’t yet been ratified by either government.

Border dispute on account of virtual Inauguration of an 80 Km road to Lipulekh pass on the Indo Tibet border on 08 may by the Defence minister of India; was the latest flash point in the Indo Nepal relations. The latest issue is actually based on a dispute over an historical aberration or of otherwise of a geographical territory. It has been brewing between the two neighbouring countries for the past several decades now. The bone of contention is the Kalapani-Limpiadhura- Lipulekh ‘Trijunction’ between Nepal-India and Tibet ( now part of Chinese Tibet Autonomous Region). Located on the banks of the river Kali (Mahakali) at an altitude of 3600m, the Kalapani territory lies at the eastern border of Uttarakhand in India and Nepal’s Sudurpashchim Pradesh in the West. India claims the area is part of Uttarakhand’s Pithoragarh district, while Nepal believes it to be part of its Dharchula district. Nepal Protested that the road was in the area which is part of Nepal. It needs to be noted that the new road alignment is along the Kali River which is the boundary between India and Nepal. The end point of the road is at Lipulekh Pass with China which is near the tri-junction of India, China (Tibet) and Nepal. New Delhi has rejected Kathmandu’s protest, saying the Lipulekh region is “completely within the territory of India” and that both sides could resolve such boundary issues through diplomatic dialogue. The Nepal Government on 20 May 2020 unveiled a new political map of the country that depicts Lipulekh, Kalapani and Limpiadhura as part of Nepalese territory. Nepal’s lower house passed the constitutional amendment seeking to replace the old map with the new map on 13 Jun 2020 and Upper House passed the bill on 17 Jun 2020. The Law Minister of Nepal informed the house that they had enough facts and evidence to support their claim and will resolve the issue with India through diplomatic negotiations. President of Nepal gave her accent on the same day after the passing of the constitutional amendment by the Upper House. India, which controls the region – a slice of land including Limpiadhura, Lipulekh and Kalapani areas in the northwest – has rejected the map, saying it is India’s new road, up to the Lipulekh pass, is not an unprecedented change in the status quo. India has controlled this territory and built other infrastructure here before, besides conducting its administration and deploying military forces The area of Kalapani is of strategic importance to India because it provides shortest route to Tibet from Delhi besides it would be an important and convenient route for Man Sarovar and Mount Kailash. It is of significance that China appears of have accepted the sovereignty Of India on this route as in 2015 she had agreed to do trade with India through Lipulekh pass.

  Map -2: Map Issued by Nepal on 20 May 2020

  Map -3: Area under Dispute

The problem has its origin in the interpretation of the Treaty of Sugauli of 1816; between the East India Company and Nepal post Anglo- Nepali War (1814- 1815), which stipulated that the Kali (India calls it Mahakali) river would mark the western border of Nepal with India. The tributaries of the Kali River comprise a number of streams, including the Lipu Gad, which merge into the main river at the Kalapani temple near the tri-junction. India asserts that old British surveys and maps show this section as part of India. But Nepal points to other maps and documents to support her claim. Total area which Nepal claims is 355 km . Point to note here is that even when Indian military units occupied the Kalapani area during the Sino-Indian war of 1962, Nepal did not raise any objection. Nepal ignored the Kalapani issue from 1961 to 1997. The dispute over the location of the river, and consequently that of the territoriality of Kalapani, was first raised by the Nepalese government only in 1998, after the ratification of the Mahakali treaty with India by Nepal ’s Parliament. Nepal ’s claims first surfaced during the negotiations resulting in the Sino-Nepal Border Agreement (1961), Sino- Nepal Border Protocol (1963) and, the subsequent 1979 Border Protocol. According to Nepal, after the India-China war in 1962, Nepal allowed Indian troops to occupy some posts in Nepal as a defensive measure. India has withdrawn from all of them, except Kalapani. Now Nepal has demanded that the border post be removed and the area restored to it. Notwithstanding the current protest, it needs to be realised that the Road to Lipulekh has not been built overnight. In fact the road was under construction since 2008 and as such it is unbelievable that the Nepal government was not aware of its progress. In all fairness Nepal Government did raise the issue during November 2019 , when India issued its new political map based on new reorganisation of its own states’ boundaries in post Article 370 abrogation. It also appears to be an attempt by Nepali PM, Sri KP Sharma Oli to strengthen his position within his party as well as to divert attention of the nation from the problems staring in the face. Land being an emotive issue, he was swiftly able to mobilise public opinion, play up nationalist sentiments against India, get his internal party rivals on board, and divert attention from his failed ordinances and challenges to contain the COVID-19 pandemic. In this connection it is relevant to note that since the blockade of 2015, anti-Indian sentiments have been gaining ground in Nepal. The argument of ROTI-BETI relations and religious and traditional cultural relations no longer impress the new generation of Nepal. In fact when they see pictures of Shanghai and Beijing and compare them to adjoining areas of Bihar and East UP; whom they find as impoverished as they themselves are; they do not relate to India to their dreams. Such public sentiments; PM Oli finds easy to exploit to strengthen his position within the party and within the country.

This indeed is a nadir in the relationship between India and Nepal. More so with China gaining upper hand in Nepal due to leaning of the current government of Nepal towards China. The spectre of China gaining ground in Nepal makes the situation quite worrisome for India, because presence of China in a hostile Nepal will directly threaten heart land of India. In this connection, some of the recent actions of the Nepal Government confirm the tilt of the present government towards china. Two examples would suffice. First is; Nepal choosing not to attend the BIMSTEC Conference hosted by India, terming it as an anti-China military alliance driven by India in Jan 2020 and second is that the Nepali Communist Party has created obstacles to the implementation of a United States-sponsored MCC grant that would upgrade Nepal’s electricity transmission system and connect it to the Indian power grid. themselves not as a ‘land locked country’ but a ‘land connected country’. Nepal appears to be trying to assert her sovereignty by charting a more independent Foreign policy course.

Other Land Disputes– Besides Kalapani, there are two more land disputes between the two countries. One is in the Susta river border region which is part of West Champaran District in Bihar and Nepal claims it to be part her of Susta Rural Municipality under West Nawalparasi District of Province No 5. and the second little less known is at the Eastern Tri- Junction in Sikkim.

Both governments agreed during PM Modi’s 2014 visit to discuss the issues through Foreign Secretary level talks. At the root of the issue is the differing interpretations of what exactly warrants a diplomatic dialogue. While Nepal considers that certain territories which belongs to Nepal but is under occupation of India, the latter considers it to be an issue of technical nature

Changing Dimensions of Indo Nepal Relations

Indian Assistance to Nepal– As a part of her Act East policy India has been investing in upgrading its cross-border infrastructure and economic assistance to Nepal for example; there are now new rail and road links, an electronic cargo system for Nepali goods to transit via Indian ports, inland waterway navigation plans, and a new cross-border pipeline for petroleum products. These are just some examples of the many projects that India has undertaken/are being undertaken. As far as financial assistance is concerned the details are as tabulated below:-

Table-1: Indian Financial Aid to Nepal

Ser No Year Amount in Crores
1. 2016-17 333.72
2. 2017-18 253.17
3. 2018-19 652

Ref: Jayant Jacob, “ Nepal Top Recipient of India Aid with 253 Crore”, published in Hindustan Times 06 Apr 2018

While this approach is; ‘work in progress’; the traditional approach, focused on security, military and other geostrategic factors, continues to prevail, especially in moments of crisis and tension such as now. Indian Strength against China is in the people-to-people contact. Besides a large number of serving (about 32000 personnel) and retired military personnel  (around 126,000 personnel) of Indian Army, more than a million Nepali citizens are working in India and the remittance send by these two groups is a major source of revenue to Nepal. As against this Main Land china has miniscule presence of Nepali migrant workers (approximately 3500) even Hong Kong has only 15950 people of Nepali migrant (2017 estimate).

Madhesi Problem and Blockade of 2015

Madhesis form 39 % of the population of Nepal but when the then seven-party alliance of the mainstream political parties and the CPN-Maoist jointly announced the Interim Constitution in 2007, it totally ignored the concept of federalism. This triggered a decade long Madhes movement. Their demand was equal rights for Madhesis,Tharus, Muslimsand Janjatigroupsin Nepal. Althoughtheinterimconstitutionof 2008 ensured the demands of Madhesis to be considered, the 2015 Constitution of Nepal failed to address any of those issues. One of the major trigger was unfair formation of seven federal provinces under the new Constitution. The other one was the issue of proportional representation or inclusion in all organs of the state (Madhesis being higher Indian population and yet have lesser number of members in Parliament).”The constitution states that 45% of all jobs in state organs and public employment are reserved. Madhesis did not accept this amendment. The third issue was related to gender discrimination as it denies single woman to pass on citizenship to their children. As per the amendment, clauses in the constitution draft say that both parents have to be Nepali to acquire citizenship. Likewise, a Nepali woman married to a foreign may not acquire citizenship but if the father is Nepali, the child is given citizenship regardless. Madhesi Communities, who often have marital ties with Indians across the border, will be disproportionality affected because they are ethnically and socially connected with the North Indians. India felt that these constitutional provisions were anti-Madhesis.  There was a strike based on this disaffection and it resulted into an economic blockade, which began on 23 Sep 2015. The blockade was an unmitigated disaster which quickly degenerated into a humanitarian crisis. Nepal accused India for the blockade. Although India denied the charge but it did not cut any ice with the common Nepali. The blockade turned average Nepali hostile to India. There was a campaign on social media: hashtag#BackoffIndia as well as street agitations. The blockade choked imports of not only petroleum but also medicines and earthquake relief material and affected distribution of relief material and stoppage of international flights from Kathmandu Airport. The government of Nepal failed to ease this fuel crisis and could not bring petroleum from China on time although it signed an agreement to buy one-third of Nepal’s petroleum requirement from the northern neighbour. This agreement was seen as a cornerstone for Nepal to end the full dependency on only one country for petroleum imports. China donated 1.3 million liters of petrol to Nepal after the fuel crisis through the Kerung to ensure that the trucks entered Nepal safely. Madhesi parties also criticized the Nepali media reports blaming the blockade on India.Some Nepali scholars started asking the government to Internationalize the issue as India had moved back from the Nepal India friendship treaty and violated the various International trade, transit and commerce laws.

It was said that the blockade had been done by the Madhesis (Tharu and Kiranti people). India repeatedly kept suggesting to Nepal to solve the issue with the Madhesi. This blockade dented the  Indo Nepal Relations substantially and it will take a long time to repair it. Some agitating people were blocking the border points and disrupting the supplies. In fact India officially informed that 4,310 trucks were sent to the border, where they had been stranded. He argued that from there onwards, it was Nepal’s responsibility. Finally on 23 Jan 2016, Parliament of Nepal approved by two- third majority, the amendment, to address two key demands of the Madhesis – proportionate representation to the minority community largely of Indian-origin and seat allocation in the Parliament on the basis of population. Madhesis termed it as an incomplete amendment as it did not address their demand of re-drawing of federal boundaries. However, Madhesis backed down unilaterally and called of the blockade with effect from 04 Feb 2016.

Nepal’s Neutrality– The 1950 military occupation of Tibet by the PLA raised significant concerns of security and territorial integrity in Nepal, drawing Nepal into a close relationship with extensive economic and military ties with Republic of India. The 1950 Indo- Nepal Treaty of Peace and Friendship that had established a close Indo-Nepalese relationship on commerce, and foreign relations, is being increasingly resented in Nepal, which began seeing it as an encroachment of its sovereignty. During the War of 1962, though Nepal maintained neutrality, however allowed Indian troops to establish 18 border observation posts (BOPs) along the Sino-Nepal border. After the war, Indian army acquiesced to Nepal governments request and pulled out from all but one border observation post. India still maintains military presence in Nepal’s Kalapani area. Subsequent Nepal since 1990 has been urging India to remove Indian troops from Kalapani area, which has however not been agreed by India.

Attempts to Counter India’s Cultural Dominance –India’s soft power influence in Nepal has always remained a challenge to pro-China forces in Kathmandu and Beijing. Bollywood’s connect with the millennials in Nepal is extraordinary. More often than not, it engulfs itself in discomfort exhibited by the Nepali nationalists. Recent order of restricting screening of Indian movies for only six months is a case in point. There is a growing demand in Madhes to secede from Nepal. These kind of sentiments make decision makers quite apprehensive about India. In the backdrop of these sentiments Indian support for amending the constitution  give grind to their fears and Nepal then attempts to align more with China. China also is aware of the fact that due affinity on account of culture, religion and social connect India scores and a subtle attempt is being made by China to reduce this influence. The establishment of Chinese study centres are an attempt in this direction.

Impact of Tension between India and Nepal- the terrain in the largely unguarded border areas of Indo- Nepal border is jungle/ riverine. It is being exploited by the Chinese and the Pakistani intelligence agencies to smuggle arms/contraband, to carry out  attack in India and return to Nepal to seek shelter. Growing number of Muslim fundamentalist groups among the 12-13% of Muslim population in Terai region is perceived as a measure of success of the ISI in establishing a base for themselves. The ISI has also increased its assets in Kathmandu over the years. The current hostility gives a boost to these activities.

Growing Chinese Influence in Nepal

Nepal established diplomatic relations with the People’s Republic of China on 01 Aug 1955and signed the Treaty of Peace and Friendship in 1960; relations since have been based on five principles of Peaceful Coexistence  (PANCHSHEEL).  Mao Zedong called Nepal as one of the fingers of his five finger policy (other four are; Ladakh, Sikkim, Bhutan and Arunachal Pradesh). Nepal maintains neutrality in the conflicts  between China and India. It remains fully committed to the ‘One China Policy’. and is known to curb anti-China activities from the Tibetan refugees in Nepal. Citizens of both the countries can travel up to 30 km within the boundary without visa.

The bilateral relation between Nepal and China has been friendly. These are defined by Treaty of Peace and Friendship- 1960. From 1975 Nepal has maintained a policy of balancing India and china. In recent times China is trying to get into SAARC and Nepal is supporting their efforts.

Economic Cooperation– Presently China is the biggest source of FDI to Nepal (90% of FDI in 2019-20 was from china). Also during the visit of President Xi Jinping China pledged a financial  aid of $ 500 million to Nepal. Nepal needs to realise taking cue from the experience of other countries that such assistance on a later date may degenerate into a debt trap. To improve the trade between the two countries there are five points of trade. However the legal route is through Kodari in Nepal to Zhangmu in Tibet over the Friendship Bridge. China is constructing an Inland Container Depot near the Friendship Bridge to facilitate the trade. Presently China isviewed favourably in Nepal owing to an absence of any border disputes (things appear to have changed since then), coupled with its assistance in infrastructure development and aid during emergencies; favourability has increased since China helped Nepal during the 2015 economic blockade alleged to have been engineered at the behest of India. Post 2015 blockade, Nepal has diversified its supply of petroleum products from China by signing an agreement with Petro China , it ended the monopoly of IOC to supply petroleum products to Nepal. China has also permitted the use of four of its sea ports and three of its land ports to Nepal

Security Agreements between Nepal and China– as quid pro quo to all the financial assistance China  has asked Nepal to increase monitoring on its border and apprehend those Tibetan who run away from Chines oppression in Tibet. Nepal has already signed several security agreements with China.   Further Nepal has committed that it will not allow Anti- china activities on its soil and operationalized border security cooperation over the course of several years. With 20,000 Tibetans living in Nepal, it is likely to become a source of problem in Future for China.

Support by China for Infrastructure Development– China is presently viewed favourably in Nepal owing to an absence of any border disputes (things appear to have changed since then), coupled with its assistance in infrastructure development and aid during emergencies; favourability has increased since China helped Nepal during the 2015 economic blockade alleged to have been imposed by India. Subsequently China has granted access to its ports for trade with other countries. Nepal has also joined the Belt and Road Initiative (BRI) of China. There are 35 projects identified, which Nepal proposes to be undertaken under BRI ( the list has since been pruned to nine projects), which covers a wide-ranging area, including infrastructure development, energy, construction of integrated check posts, free trade area. For this a proposal for concessional funding had been submitted to Ministry of Finance of China to provide a concessional loan to Nepal up to $ 1 billion at 3 percent rate of interest. A high-level Chinese technical team under Jhang Lee Yang, the deputy administrator of National Railway administration, in cooperation with the Department of Railway (DoRW) of Nepal government conducted a field visit to the proposed 287-kilometre-long Kyirong-Kathmandu-Pokhara-Lumbini Railway Project in Nepal. In this regard China’s loans on an average have turned out to be debt traps and Nepal will have to be cautious. Also such connectivity will destroy Small Scale Industries not only in Nepal but even in the border areas of India due to open border. Oblivious to future shocks Nepal is increasingly becoming enamoured with China’s economic diplomacy. In this connection the case in point are hydroelectric projects which are increasingly getting transferred to China with likely disastrous consequences for India- Nepal power sharing arrangements. It may be noted that China has an insatiable need for power and therefore while China might get benefited Nepal definitely will be a loser. Although muted but resentment about some of the projects has started being heard in Nepal. It is significant to note that none of the projects so far have been taken up. Some of the hydro-electric projects and the rail project are a cause of concern. Specially that projects on Karnali, Trishuli and Arun will impact water availability in India which is the lower riparian state in this case and as per Un Convention of 1997 for the trans- border rivers rights of lower riparian states have to be taken care of.

Attempt to influence Nepali Psyche– In yet another development the Chinese government has offered to pay salaries to private school teachers who teach Mandarin in Nepal. According to reports, this move by China had made private schools in Nepal to compulsorily teach Mandarin. Now, many private schools in Nepal have started practicing the Chinese language as it is mandatory for teaching staff to communicate in this language. This move is meant to further strengthen the Chinese bonds with Nepal and grow its roots in Nepal. The recent order of restricting screening of Indian movies to six months only in a year is to further weaken the bonds between India and Nepal. The upshot of it is to  weaken bonds with India. In recent times Xi Thought has become the official doctrine of the NCP. In fact in last few years a very intimate relationship is emerging between the CCP and the NCP.

Evolving Political Situation

  • However all is not well in the current political milieu of Nepal. When a long-simmering row within the ruling Nepal Communist Party (NCP) flared up last December finally resulting into a split. Prime Minister Khadga Prasad Sharma Oli dissolved Parliament —a move critics decried as unconstitutional. In Feb 2021 Apex Court in Nepal reinstated the dissolved house . Then, on February 3, Oli moved to consolidate control over key constitutional bodies that are supposed to serve as checks and balances to the government. PM Oli lost confidence vote in the House of Representatives on 10 may but he was reappointed as PM as opposition failed to come together to offer an alternative. The recent events have been a setback for China, which supported the NCP and had tried to keep it unified. India, the United States, and the European Union, which stand to benefit from China’s loss of influence, have remained neutral to PM Oli’s actions. Here it is important to understand the recent NCP split and related PM Oli’s manoeuvres. Ahead of general elections in 2017, the Maoist Party of Pushpa Kumar Dahal ‘Prachanda’ and the United Marxist Leninist (UML) Party led by Oli agreed to campaign together and finally went for a full-fledged merger to form Nepal Communist Party (NCP). NCP won the election with the understanding between Oli and Prachanda to share the party’s chairmanship and take turns as prime minister during the government’s five-year term. Oli went first for the position of PM. Soon after taking office, Oli began to consolidate power in his own hands. In March 2018, he took the unprecedented step of bringing the national agencies for intelligence, tax fraud investigation, and money laundering investigation directly under his control and brought several new bills which threaten free speech and allow the government to spy on citizens with little oversight. These actions of Oli divided NCP. The deadlock ended only when the Chinese ambassador to Nepal mediated between the warring factions.  But the rift festered. Finally the Oli prorogued Parliament in July 2020. Finally, The NCP split.Most Nepalis see the NCP split as driven by the leaders’ egos rather than any political ideology.
  • China appears to be willing to work with any political dispensation so long it takes firm action against the political activities of the Tibetan refugees. Bigger problem that is brewing in Nepal is that China has also begun taking an active interest in Terai politics. China’s political influence grows in Nepal, Beijing may have, encouraged Prime Minister Oli to take a bolder stance against India during the boundary dispute. By playing the China balancing card as a last resort, Nepali leaders have often hoped to get Delhi to pay attention to festering problems that Indian diplomacy neglects or forgets about. It is risky because it assumes China is always willing to extend indefinite support to Nepal at the cost of its relations with India.
  • In a surprise move one of the Madhesi parties, Janata Samajwadi part joined minority government of PM KP Sharma Oli on 04 Jun 2021. His will help PM Oli to consolidate his position in House of Representatives against oppositions attempts to dislodge him. Further the statement of PM Oli is significant that all issues with India has been resolved. This only proves that in the See Saw battle of supremacy it is becoming advantage India against China, who for last two years had been calling the shots in Nepali politics.

Advantage India– While Nepal’s political crisis is a setback for China, India seems to be waiting with cautious optimism. New Delhi’s longtime influence over Kathmandu politics waned with the rise of the NCP, which cultivated close ties to Beijing and even held trainings on “Xi Jinping Thought”. It appeared to be a continuation of the diplomatic spat Nepal and India had last year on ‘Map Issue’. But as the NCP’s internal dispute escalated, Oli seemed to begin courting Indian favour. The Indian intelligence chief, army chief, and foreign secretary all visited Kathmandu in the months before Oli dissolved Parliament, and in December, Indiandiplomats declared the dissolution of the Parliament an “internal matter.” Then, in late January, India became the first country to donate one million dosage of the  COVID-19 Vaccines to Nepal. It is unfortunate that India due to its own vaccine problems has not been able to maintain the momentum. This may turn out to be a lost opportunity to reset India Nepal relations.The Chinese assertiveness in the border areas has further fuelled the suspicion of average Nepali about Chinese intentions. In this connection it may be noted that As per a survey by Nepal’s Ministry of Agriculture, China illegally encroached on several bordering districts including Gorkha, Dolakha, Humla, Darchula, Sindhupalchowk, Rasuwa and Sankhuwasabha. In this connection it is worth noting that in Nov 2019 encroachment of 36 hectare of Nepali territory was reported. There was a further risk of losing several more hectares of land. It has also been reported that road construction work in Tibet Autonomous Region (TAR) has caused change in the course of common rivers like Arun and that is likely to expand China’s boundary into Northern territories of Nepal. To further add insult to injury in May 2020 China called Mount Everest(which is located at the border of China and Nepal) as Mount Qomolangma and claimed it as a part of Chinese territory. Although the border dispute between India and Nepal remains unresolved and many average Nepalis are still resentful of India, with all these attempts on the part of China to grab Nepali land, the initiative seems to be now with New Delhi. The recent mediation effort by the Chinese Ambassador between the warring factions of the NCP has further made average Nepali citizens wary of China, who consider such an attempt of  micro-management  as an interference in their sovereignty.

Geopolitical Jockeying– The United States, too, stands to benefit from Nepal’s political crisis and has not criticized the prime minister’s recent actions. Like India, the USA also seeks to increase its influence in Nepal as a counterweight to China. Previously, the NCP was divided over whether to accept hundreds of millions of dollars in U.S. aid through the Millennium Challenge Corporation (MCC), a special funding mechanism, with Oli for and Dahal against the agreement. The NCP breakup and new political alignments could create an opening for the USA to push the MCC forward. Still, critics argue that the U.S., India, and the EU —the world’s largest democracies —are being hypocritical by remaining silent on Oli’s moves to consolidate his power .

Security Implications of Growing Chinese Influence on India

The recent reports of missile launching facility coming up near Mansarovar in TAR by China, Rail line coming to Nepal Border from Shigatse and plans to extend it further, Hydroelectric projects on Arun (Sapt Koshi) & Karnali unmindful of UN Convention-1997 on the rights of lower riparian states by China in Tibet and growing foot prints of Pak sponsored terror networks in Madhes region of Nepal are having grave security implications in both traditional and non-traditional domain of National Security of India. A hostile Nepal under the influence of China will be a bad news for security in the Central Sector (Uttarakhand and Himachal). Any ingress in this sector will directly impact North Indian heart land. Therefore it is important that all necessary steps by the Security Establishment of India in conjunction with diplomatic outreach are taken at the earliest to ward off threat in this sector.

Recent Developments Showing Improvement in Relations

Visit of Chief Of Army Staff  of India To Nepal-Army Chief General Manoj Mukund Naravane visited  Nepal for three days from 04-06 Nov 2020.It was not a routine visit but it also marked a resumption of ties between the two countries after months of chill and  restored the ties at the old level, as all those activities which used to be done in past during similar visits were also restored. Gen Naravane was conferred the honorary title of ‘General of the Nepal Army’ by Nepal’s President Bidya Devi Bhandari in keeping with a 70-year-old tradition under which the Nepal Army chief is also similarly honoured by India. The primary agenda for the Indian Army Chief during his three-day visit was to strengthen military ties between the two countries. Gen. Naravane’s visit also ensured a continued bonhomie between the Indian and Nepalese armies, and also ensured continuity of strong military cooperation between both the two nations.

Other Visits– Besides the visit of the Chief of Army Staff (COAS), a number of other visits helped to reduce the chill which had set in the relations. The process of thawing commenced in Aug 2020 when an online meeting was helped between the two Foreign Secretaries to review the progress of projects being undertaken by India in Nepal. In the month of Oct 2020 Head of RAW visited Nepal and met the PM Oli. After COAS’s visit Foreign Secretary to reset ties. In Jan 2021 Foreign Minister of Nepal visited India for three days. During the visit he attended the 6th meeting of Nepal-India Joint Commission and discuss the entire gamut of relations, including COVID-19  cooperation and border disputes, with his Indian counterpart Dr S Jaishankar.

Thaw in the Anti India Utterances– After months of jingoism, the PM of Nepal attempted to mend fences with a call to the Prime Minister of India on the eve of Independence Day.

Way Ahead

Some of the measures that India can consider to win back Nepal’s confidence are as follows:-

  • One of the things which irks Nepal is that India tries to micro manage Nepal’s politics. It will be better for Indian policy framers to realise the changing paradigm of Nepal and they need to work on the principle of India First but remain sensitive to Nepal’s aspirations. India needs to assure and keep reassuring that she respects Nepal’s sovereignty.
  • Nepalese have started getting aware of the intentions of the Chinese as cases of Chinese nationals indulging in human trafficking and Cyber-Crimes have started coming to light. Also there are border disputes coming up with China too. A change in New Delhi’s attitude is required in order to pursue our diplomacy in Nepal. Projects need clearances, funding at a pace that can be matched up to Chinese.
  • India and Nepal need to work hard to keep their relationship stable, even if not special. For example, India can no longer remain fixated on its traditional approach towards Nepal and expecting Nepal to give first right of refusal to India . India needs to become awarethat Nepal has been embracing a policy of strategic diversification to safe guard its national interests. The rising presence of China across the Himalayas, especially after Nepal having decided to join BRI has called for a paradigm shift in India’s Nepal policy. In this connection the report prepared by an Eminent Persons Group from both the countries to assess the state of bilateral relations mandated in 2015 by Indian and Nepali Prime Ministers is gathering dust since its submission in 2018. Such indifference on the part of India is being taken negatively by Nepal.
  • Even after political trust is restored and diplomatic dialogue begins, whether in a few days, months or years, both sides will have to compromise. The border dispute has turned into a permanent political irritant between the two countries. To thwart Chinese attempts to fish in the troubled water it is important that India settles the issue with Nepal. In this connection the historical, technical and cartographic claims from both sides will probably lead to a dead-end, with never-ending, clashing interpretations about river alignments and other contentious criteria. The only possible solution is to go for joint management and if possible shared sovereignty. Such a possibility may appeal to Nepal as it would offer them easy access to Mount Kailash and Man Sarovar. If India in past could offer to Pakistan Joint management of Siachen it would not be such a difficult proposition.

Author Maj Gen AK Chaturvedi, AVSM, VSM (Retd)  is a retired Indian Army General Officer who has served in Jammu & Kashmir, NE, Andman Nikobar on various appointments at Command and Army HQs. . He is Vice Chairman of Think Tank, “STRIVE”,  after retirement is pursuing his favorite hobby of writing for newspapers, journals, and think tanks.

Disclaimer: The views expressed are those of the author and do not necessarily represent the views of the organisation that he belongs to or of the STRIVE.


2 thoughts on “Indo Nepal Relation: Time to Review By Maj Gen AK Chaturvedi (Retd)

  • June 11, 2021 at 9:06 am

    Sir, it takes long to read your article and rereading to absorb it.But the analysis is wonderful.

    Your suggestion of joint management of contentious River alignments is appreciable to ward off China to take advantage.

    This article is excellent and should be read by all diplomats dealing with Nepal

    Hats off to you Sir and the Sappers

  • June 10, 2021 at 7:47 am

    Gen Chaturvedi, your research and in-depth analysis on any subject is really commendable and in this article you have very lucidly brought out the whole gamut of India-Nepal-China equation.

    I wonder if the powers that be, analyse the current rising influence of China on Nepal especially the financial skulduggery which China has so manipulatively exploited in gaining access to Ports in Srilanka.

    If India doesn’t proactively counter the Chinese loan sharking machine, the day is not far when the roads, bridges and may be dams of Nepal will be under control of China and it will pose a huge security risk to India.

    A great article with in-depth research, Kudos to you sir for such an exemplary effort.

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