Nepal’s new government signals shift in India, China relations

Nepal’s incoming government has signalled it will pursue a more pragmatic foreign policy centred on national interests, as the newly victorious Rastriya Swatantra Party (RSP) seeks to recalibrate relations with both China and India after years of shifting political alignments. In its election manifesto, RSP pledged to pursue “balanced and dynamic diplomacy” with both neighbours, emphasising economic cooperation, cross-border connectivity and trade while transforming Nepal from a “buffer state into a vibrant bridge”. “Our relations with our neighbours and other countries will be based broadly on the national interests of Nepal,” Shishir Khanal, an RSP leader and newly elected parliamentarian, told This Week in Asia. “We will focus on economic and development diplomacy, where we will build relationships for the economic growth of our country.” RSP secured a landslide victory in last week’s poll, an unprecedented feat for a party that entered national politics only four years ago. Voters frustrated with corruption and unstable governments – grievances that erupted into a youth uprising last September – largely rejected Nepal’s three traditional parties, clearing the way for 35-year-old rapper and engineer-turned politician Balendra Shah to become prime minister. While Shah has not put out a detailed foreign policy doctrine, analysts say his public statements and the party’s campaign messaging suggest a nationalist approach that does not favour any single partner over another. The former Kathmandu mayor has criticised Nepal’s overdependence on Delhi, banned a Bollywood film over a cultural dispute and used profanity against India, China and others in a now-deleted social media post. On Tuesday, Shah posted on social media that “we will work together to further strengthen, deepen and make more result-oriented” ties with India in response to a congratulatory message from Prime Minister Narendra Modi. Historical alignments Two of Nepal’s oldest parties – the Nepali Congress and Communist Party of Nepal – were founded in India in the 1940s when parties were banned under the autocratic Rana rulers. While the Nepali Congress has historically maintained close ties with India, the communists have leaned towards China. Communist leaders K.P. Sharma Oli and Pushpa Kamal Dahal have particularly deepened ties with China over the past decade, with Oli tilting towards Beijing as a counterbalance to Delhi. Nepal’s relation with Delhi cooled significantly under Oli after a spate of incidents – including India’s unofficial economic blockade in 2015 and Nepal’s approval of a map including contested area along India’s border – pushed the country further into China’s orbit. Huang Yunsong, deputy director of Sichuan University’s Institute of South Asian Studies, said RSP’s victory presented “structural opportunities” to strengthen China-Nepal relations. He added that the previous governments’ handling of relations with China, which involved policy fluctuations with power changes, “provided great food for thought for RSP to pursue a better and more effective engagement with Beijing”. “China is interested in establishing institutionalised communication with RSP,” Huang said. “The focus is not on whether to realign the relationship, but how to connect with each other. China will closely follow RSP’s foreign policy agenda and attempt to accurately align the Belt and Road Initiative.” Though Nepal signed up to the initiative in 2017, none of the 10 projects have moved beyond planning. While Oli prioritised completing a major belt and road project in his constituency in eastern Nepal’s Jhapa, Shah did not mention it when campaigning in the same region, reflecting a sensitivity to the concerns of both neighbours. Arpan Gelal, a research coordinator at the Kathmandu-based Centre for Social Innovation and Foreign Policy, said this could be an electoral rather than geopolitical calculation. Jhapa’s China-Nepal Friendship Industrial Park is strategically sensitive as it is near the Siliguri Corridor, a vital link to India’s volatile northeast states. Chinese projects in Nepal have also been mired in controversies, with critics accusing Oli and Dahal of awarding infrastructure contracts without transparency or due diligence. Last year, Nepal’s anti-corruption agency filed charges against former ministers, bureaucrats and a Chinese state-owned company in connection with a multimillion-dollar embezzlement during the construction of China-funded Pokhara International Airport. “Previously, China had some leeway with Nepali communist leaders in the government, but that could take a back seat now with RSP,” said Gelal, who researches China, borderlines and geopolitics. “China needs to change its strategy – there has to be a shift in under-the-table negotiations that bypassed state mechanisms and become more transparent, working with the new government.” He added that RSP would also uphold Nepal’s long-standing one-China policy while safeguarding security along the Tibetan border. RSP’s Khanal said his party was committed to Nepal’s long-standing foreign policy commitments with China, but the new government would assess new China-funded projects based on their priorities through bilateral discussions. Important partners Both India and China were equally crucial to Nepal, said Kalyani Honrao, a Mumbai-based independent geopolitical analyst. While the Belt and Road Initiative could support Nepal’s economy through investment and job creation, one of RSP’s key campaign promises, India remains the primary source of trade and essential goods and fuel for landlocked Nepal. “Nepal will not alienate itself from two important bilateral partners,” Honrao said. “The incoming government will adopt a balanced approach in its foreign policy. Addressing security challenges in the Siliguri Corridor will be crucial for India. Therefore, India will engage actively with the new Nepali leadership to maintain friendly ties.” Nepal’s foreign policy, long shaped by a delicate balancing act between its two neighbours, is often viewed as a contest between India and China for influence. Domestic leaders have frequently aligned themselves with one or the other for political and personal gain. But analysts say that such narratives can be risky. “Excessive pro-China tendencies may lead to Indian intervention and political instability in Nepal, while uncontrolled anti-India sentiments will also increase regional frictions,” Huang said. “To maintain healthy relations with both China and India, the new RSP government can continue to have a balanced strategy.” Gelal, however, said Nepal’s external affairs should move beyond balancing, which he called “an old idea in foreign policy”. Instead, the new government should focus on how to strategically benefit from its neighbour, he said. “RSP doesn’t have the ideological or relationship baggage, unlike previous parties,” he said. “This is the time to dismantle the ‘pro’ and ‘anti’ narratives and make operational, logic- and interest-based [rather] than ideology-based policies. That would be the start of a new era for foreign policy in Nepal.”

Nepal’s new government signals shift in India, China relations

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Newly elected Balendra Shah’s public messaging suggests a balanced approach rather than a tilt to either side, analysts say

Newly elected Balendra Shah’s public messaging suggests a balanced approach rather than a tilt to either side, analysts say