With China and India locked in a high-stakes border standoff over the Doklam plateau, Nepal has been caught between two powerful neighbours. Chinese Vice Premier Wang Yang’s recent visit to Nepal and Prime Minister Sher Bahadur Deuba’s upcoming trip to India under the current circumstances have, therefore, been a time to reflect on what Nepal’s role should be in regards to the standoff and how Nepal could protects its own national interests as the two powers could come to a head over tiny Bhutan. Mukul Humagain and Sanjeev Giri talked to former Nepal ambassador to China and Chair of the think-tank, Nepal Alternative Research Society, Mahesh Maskey, who has a sound understanding of regional geopolitics and China’s neighbourhood policy.

What was the primary objective behind Chinese Vice Premier Wang Yang’s visit to Nepal?

This visit by Chinese Vice Premier Wang Yang was particularly important because a number of events have unfolded recently that have a bearing on China’s relationship with India and Nepal. Nepal signed a framework agreement for the Belt Road Initiative (BRI) in May, and this visit could be regarded as an initiative to strengthen this recent development. The second, more pressing issue at hand, is the stand-off between China and India in the Doklam area. China has praised the non-aligned stance of Nepal in the Doklam issue. Perhaps China hoped that with this visit, Nepal could be encouraged to facilitate dialogue between China and India. It is integral that Nepal appear a balanced and neutral party.

Vice Premier Wang is an extremely important, high-ranking Chinese politician. He has a huge hand in China’s dealings with South Asia the Association of Southeast Asian Nations (Asean). The Chinese government is making a point for their regard for Nepal when they send someone of his stature. Now we need to reciprocate this gesture and move to push forward the agreements made between our two governments.

What specifically does Nepal stand to gain from the BRI?

There are a vast number of benefits that Nepal could reap from joining the BRI. In my opinion, Nepal should be driving the push for eco-development. We should not be waiting for China to come and tell us that development should be pushed forward. If the transit facilities through China could be harnessed prudently, the BRI offers Nepal a trade and cultural cooperation opportunity between more than 60 countries who have signed on to the project. Nepal could benefit hugely from this connectivity. The Asian Infrastructure Investment Bank (AIIB) has also been established to support infrastructure projects in Asia, thus providing financial backing as well. Another thing of note is the technological benefits Nepal can reap through a partnership with China. We need technology to fuel development, especially considering the difficulties presented by our geographical terrain.

The Chinese government is pushing for an investment model to finance the building of railways; with an investment model, the Chinese government will also benefit from returns. China has already made inroads into establishing a railway line close to its border with Nepal, so it will not take long for the Chinese side of the railway to come into Nepal. However, Nepal has no such infrastructure in place; we need to start work from our end immediately. Instead of being confined to rhetoric, Nepal has to demonstrate its zeal through actions.

With a railway in place, we can formulate a tourism-centric development model and boost the tourism sector, thus providing another way via which Nepal can benefit. Trade will also be promoted all throughout Nepal; the northern districts and mid-hill economy in particular will get a boost.

India has stayed away from the BRI, and now it seems that the Doklam standoff has caused the India-China relations to deteriorate further. Will the standoff have a deleterious effect on China’s push for connectivity in the region?

Connectivity should be viewed through both an economic and security perspective. The emergence of the String of Pearls theory has already created a security dilemma between China and India in the Indian Ocean, and the BRI will span over an even larger area. It stands to reason, then, that India would have security concerns. Security and military competition in the past has fuelled an environment of mistrust between India and China. But in spite of this, India and China have developed a major trade partnership worth over $60 billion. If India developed a measure of support or an agreement modality with China, that could benefit the Indian economy. This could perhaps circumvent security concerns arising as a result of the BRI. If this happens, then the Asian Century could still be realised.

However,  recent developments such as the Doklam issue have caused the distance between India and China to grow. Not only could this definitely affect the BRI, it could also affect economic diplomacy and trade.

Our geostrategic position puts us between two huge economies and strategic rivals, and renders it essential for us to handle the situation by projecting ourselves as an independent moderator. Towards this end, what steps can we take?

Nepal has to establish itself as an independent and sovereign nation with a non-aligned foreign policy if it is to truly step in as a mediator to resolve the issues between India and China. If the situation does deteriorate into a war, then we will be pulled into the resulting fallout. So, Nepal has to maintain a distance from either country, but, at the same time, has to try to moderate as a neutral party. But one thing to remember is that Nepal should not get too deeply entangled in the conflict between India and China. It is essentially their conflict.

On a broader level: what interests does China have in Nepal?

China realises that good relations with Nepal have to be maintained; conflict with neighbouring countries should be avoided at all costs. China and Nepal established diplomatic relations in 1956, so the history between the two countries is long and cordial. Nepal also borders the Tibet autonomous region, a sensitive area for China. China realises that until Nepal develops economically and gains political and economic stability for sustainable development, the stability of Tibet too may be affected. Nepal will also profit from China’s economic advancement, thus resulting in a win-win situation for both sides.

The Indian establishment still considers Nepal to be under its ‘sphere of influence’. How can Nepal and China advance their relationship in the face of Indian reservations?

If we are able to take a stand and communicate the message that we can stand as a sovereign nation, then we will not be taken lightly and India will rethink their position.

We have given a glimpse of such a stand during the embargo imposed by India in 2015. We used to be dependent on India, but now the situation has changed, and we are slowly weaning ourselves off this tendency. We need to be able to tell India that Nepal is now moving forward and that the relationship between the two nations has to be redefined.

If Nepal takes an independent, sovereign and non-aligned stand, that will assure China as well about its commitment. But it has to be understood that China will not get into a conflict and jeopardise its relations with India solely for helping Nepal, unless the matter endangers Nepal’s sovereignty. 

As the the Doklam standoff drags on, isn’t it only right that Nepal should resolve the issues of the Lipulekh pass and Kalapani for good?

We need to eventually raise consciousness regarding Nepal’s claim over Lipulekh pass and Kalapani, but perhaps not now. We have to have a better understanding of this disputed area and the arguments behind the claims of each country if we really want to resolve the issue. Using the conflict between India and China as footing to resolve the Lipulekh and Kalapani issue is remiss. We have to wait until the environment and the timing is right.

How does the Nepali government’s political will and bureaucratic regime factor into the development of diplomatic ties with China?

Nepal and China signed a transit agreement in March 2016. This was after the unofficial blockade imposed by India had ended. The blockade drove home the fact that Nepal needed another source of petroleum products other than India. China was seen as a viable alternative if transportation and transit issues could be addressed effectively; petroleum products could be transported to Nepal from a third country through China. Despite hedging by the bureaucracy, a transit document was finally pushed through. However, a detailed protocol is yet to be worked out. As of now, nothing concrete has come to light. It seems as though the Chinese government wishes to conduct discussions with a stable, long-term government. Strengthening bilateral trade and diplomatic ties after the historical agreement and joint statement of 2016 was undermined by the fact that the Dahal and Deuba and, even Oli’s, governments have not done much towards following it up. No one knows how long our window of opportunity with China will last, so we should not take it for granted and we should translate our plans into action.