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COMMENTARIES OCT 18 2019

Xi’s visit exposes the limits of China-Nepal strategic

convergence
RAJESWARI PILLAI RAJAGOPALAN

Despite the interests both sides have for better ties, there are real limits and challenges to this.
 DEBT TRAP KP SHARMA OLI NEPAL NEPAL-CHINA XI XINPING

Last week, as expected, Chinese President Xi Jinping stopped in Kathmandu, the capital of Nepal, for
a state visit on his way back to China after an informal summit with the Indian Prime Minister
Narendra Modi.

Xi’s Nepal trip itself came as no surprise: China has been attempting to woo India’s smaller neighbors
in South Asia, and there is clearly interest among some including Nepal to use the Sino-Indian
competition for their own benefits. But Xi’s trip also showed the limits of these converging interests.
Indeed, the lack of progress on issues, with an extradition agreement not signed being a case in point,
reinforces the fact that any alignment has its limits despite the strategic interests that both Nepal and
China see in the wider relationship.

The mutual attraction between Nepal and China is easy enough to understand. From Beijing’s
perspective, Nepal is important for a few strategic reasons. For one, Nepal borders China’s Tibet
Autonomous Region (TAR). Though Tibet is relatively quiet, China always worries about the
possibility of a resurgence of Tibetan nationalism. Though the largest chunk of Tibetan refugees lives
in India, Nepal also hosts about 20,000 Tibetan exiles. Any disturbance in Tibet will likely have some
reverberations in Nepal too.

Thus, China is concerned about ensuring that the Tibetan exile population in Nepal does not become
an issue of concern. This appears to have been the primary reason why China was pushing for an
extradition treaty with Nepal. This also makes good relations with Nepal an important means of
managing any future problems in Tibet itself.

In addition to this direct linkage, China also has more general and obvious balance of power
considerations in befriending Nepal. As a small South Asian neighbor of India, Nepal affords the
opportunity to balance India within the region itself. Nepal’s relations with India, which had its ups
and downs, makes Kathmandu a potentially attractive partner for Beijing. There is nothing unusual in
this because this is at least part of the reason for Beijing’s outreach to all of India’s smaller
neighbors. And of course, India returns the favor, trying to partner with China’s own smaller neighbor
such as Vietnam.

A third reason for China’s interests in Nepal is China’s drive to develop the Belt and Road scheme,
both as a means of exporting Chinese capital and labor but also expanding its interests. China has
discussed several BRI projects with Nepal, including a railroad that would link Lhasa and Kathmandu
as well as a Parliament building, National Defence University, and other infrastructure projects.

Nepal also has some interest in developing this partnership with China. For one, a closer relationship
with China makes India a lot more receptive to Nepali concerns. Nepal, like India’s other neighbors,
has complaints about the lackadaisical manner in which New Delhi approaches development projects
 in Nepal. Chinese help with infrastructure kills two birds with one stone. It potentially helps Nepal
develop economic infrastructure – China has been very efficient in completing such projects,
especially in comparison to India – while also putting pressure on India to pay greater attention to
Nepali connectivity requirements. Seen from this perspective, having two great powers competing for
Nepal’s attention will not be entirely unwelcome in Kathmandu.

In addition, Nepal, a small, landlocked country, also feels vulnerable to Indian pressures. India has
been known to impose blockades on Nepal because much of Nepal’s international trade either
originates in India or passes through Indian territory. The most recent of these blockades was in 2015,
when India imposed an unofficial blockade in an ill-advised move to pressure Kathmandu over what
was perceived by India to be discrimination against the Madhesi population in the new Nepali
constitution. Though it appears somewhat impractical, Nepal would like to reduce its dependence on
India by building trade and transit linkages through China. At the very least, closer linkages with
China might make India more careful antagonizing Nepal.

All this suggests that mutual interests by itself may not be sufficient to power China-Nepal relations.
Negotiating the terms of actual deals, domestic national concerns, as well as the fear of getting
dragged into the Sino-Indian competition, are all likely to limit how close India’s neighbors such as
Nepal will get to China.

This commentary originally appeared in The Diplomat.

The views expressed above belong to the author(s).

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