Earlier this year, the President of the United States, Barack Obama, made a state visit to India as chief guest for India’s Republic day ceremony. The world had a chance to watch the interplay between Indian Prime Minister Narendra Modi and the US President, with the former leaving no stone unturned to create an atmosphere of economic cooperation with the US. Seizing the day, Modi hosted two economic summits in India: the India-US Business Summit and the US-India CEO Forum, creating an environment of dialogue between business stakeholders and the US President. Modi’s efforts did not go in vain. President Obama announced that America would increase trade with India by five times and it would invest $4 billion in India. Returning the favour, Modi assured that India would be a favourable destination for US investment. So it might look like the visit turned out to be very productive for India, but the story does not end here.

US interests, China interests

US Foreign Policy Professor Mieczyslaw P Boduszynski, who has served as a US diplomat to countries like Japan, Egypt, and Libya, believes that the US has four broad interest areas in India. The first is economic interest, since India’s market is lucrative. Second is balancing Chinese aggressive foreign policy in Asia. Third is a nuclear deal and fourth is cutting the carbon footprint since India is the third largest emitter in the world and an important player in solving the climate problem.

But during his visit, Obama was hardly able to take any bold steps in  the US’s interest areas, except in providing a counterweight to Chinese assertion. Obama and Modi issued a joint statement criticising China for its moves in the South China Sea. Also, there were talks on reinvigorating the loose security network between the US, Japan, India, and Australia.

The neorealist approach to international relations believes that whenever a country feels a security threat, it will attempt to counter that threat by forming alliances with other countries that have similar security interests. In the case of China, its best rebalance in Asia would be to get closer with Pakistan. This is what some critics think China is trying to do right now. However, Professor Cameron Munter, former US Ambassador to Pakistan, sees the issue differently. He states that though China and the US have different interests in most other regions, in Pakistan, they have very similar interests. Getting rid of militant Islam and spurring economic growth so that Pakistan can absorb investment and become stable are in the interests of both US and China, according to Professor Munter.

South Asian politics, therefore, is at a crossroads. Important power houses are neither rivals, since they still have some common interest areas, nor are they allies, since there are many areas where they cannot trust each other. This complexity, however, can turn be turned into Nepal’s favour.

Where Nepal fits in

The primary issue for China now is the assertion of its One China policy and its security concerns in Tibet. Most recent events in Asia have not been in China’s favour. It has relatively less influence on South and South East Asian countries like Myanmar, Bhutan, and Sri Lanka. But China is making more diplomatic inroads into Nepal as was evident in the visit of Chinese Foreign Minister Wang Yi to Kathmandu in December and the raising of Chinese foreign aid from around Rs 3 billion to Rs 13 billion. Also, there are strong indications of a potential visit to Nepal by Chinese President Xi Jinping to mark the diamond jubilee of diplomatic relations between Nepal and China.

Nepal needs China as a friend, but Nepal also needs to be able to create common ground where both China and Nepal can work together for mutual benefit. Chinese influence in Nepal might be increasing but it is no secret that Indian influence continues to have a strong hold over our internal politics and our economy. Many agreements with India have come under criticism for serving the Indian interest. Also, news of border encroachment by India are not new. Closer relations with China, then, can only benefit Nepal.

Some critics might point to a possible escalation of tensions between China and India, leading to a conflict. But it is very unlikely that India and China will ever go to war, despite some real security concern, as the trade for these two nations amounted to around $70 billion in 2014 only. Our geography is such that our interest can only be served by maintaining equidistant diplomatic relations with both India and China. We are already inclined a lot towards India so now its time to balance that by creating ties with China as well. Also, for a small developing country like ours, sovereignty can be best maintained by conducting business diplomacy with two powerful countries that are not aligned with each other. This is how other small developing countries are balancing power in the 21st century.

Shiwakoty is a student of International Relations and Foreign Policy at Pitzer College, the US