Nepal Crisis: China, India must reduce trust deficit

24th September 2015

24th September 2015

Nepal is sandwiched between India and China’s interests

Nepal is a small landlocked country sandwiched between two of world’s most ambitious and populous nations, China and India. It is strategically vital for both Asian giants—China doesn’t want it to be a hub of Tibetan separatists; India frets if it was to lose the buffer zone against world’s new superpower.

The new constitution of Nepal has raised India’s heckles. It views this as inimical to the interest of its people settled in Nepal. Worse, it sees Nepal going outside the orbit of its influence. Nepal has literally thumbed its nose at India. At who’s behest? The logical corollary is China.

Influence in Nepal is a paramount policy for China. Its’ sensitivity on the Tibet issue is well-known. Nepal shares its entire northern boundary with Tibet. Nepal hosted the Khampa rebels against China in 1959. During the 1960s, Tibetan separatists held several demonstrations in Kathmandu. Nepal has the biggest Tibetan refugee population in the world.

China can’t afford to lose Tibet which has the largest uranium reserve in the world. Most major rivers in China, including the Chang Jiang, originate from Tibet. It is known as Asia’s Water Tower. Being the “roof of the world,” Tibet also offers China a vantage position if war was to break out in the region. Tibet’s riches in terms of copper, coal, zinc and lead are priceless. If Tibet was to go, China would face several other separatist movements, for example in Taiwan or Inner Mongolia. Kathmandu has also been important for trans-Himalayan trade from the medieval ages.

Nepal’s importance for India is along the same lines, and more. It can’t afford to lose the “buffer” zone to China. It shares a 1751-km border with Nepal. If its influence was to decrease in Nepal, anti-terrorist activities could mount inside its borders and the porous boundary would allow an easy getaway. If people of Indian origin were to be discriminated in jobs, education and premier posts, the future could be bleak for India’s voice in Nepal. The consequences could be grave—instability, terrorism, disadvantage in case of a war, spiraling of military spending, being tied down to issues around its neighbourhood instead of seeking a global role—India has legitimate concerns.

While both Asian giants value Nepal, it is China which walked the extra mile in protecting its interests. After it lost its most valuable ally in Nepal’s monarchy in 2008, China sided with Maoists rather than the democratic forces which were aligned with India. It was hosting the Beijing Olympics and separatist Tibetans had raised a global voice of protest.

In 2005, India, US and UK had suspended military assistance to Nepal during the Maoist rebellion. China that very year offered a sizeable assistance. By 2009, the military aid had bloated to Rs 220 million. Maoists realized they needn’t fear India now.

India and China were soon engaged in offering increased economic assistance to curry favour. When India offered Rs 100 million for the hilly Mustang region, China forked out Rs 10 million for library, science laboratory and school building in the same region. Ambassadors of both countries paid a visit to the area.

China offered to extend the railway link from Tibet till the Nepalese border. India drafted its own plan for railway links to Nepal. The railway links plan of the two major Asian powers at certain locations is too close for comfort. The Karakoram highway, Beijing-Lhasa rail link and further towards Nepal and Sikkim all carry a definite meaning.

China has invested in mega projects such as Arniko Highway, the ring road, national stadium etc. Hundreds of Chinese firms have invested in Nepal, generating thousands of jobs. From hotels to restaurants to electronics to cell phone service, hydropower, civil construction, China’s assistance has gone in all directions. Nepal’s trade with China is largely through Tibet and Hong Kong. Nepal has been allowed duty free access to over 500 Nepali goods in the Chinese market. China became Nepal’s biggest foreign investor in 2014. China is building a billion-dollar hydropower project; Chinese engineers are constructing Nepal’s first eight-lane highway. China’s trade has almost doubled in last 7-8 years.

India loses out in perception to locals in Nepal. Its policy is confused and it has diverse objectives and contradictory statements compared to China who only wants to secure its borders. India only seems to offer help when some high dignitary visits Nepal. The perception extends that Indian projects come with lots of conditions and rarely are delivered on time.

If China and India reduce the trust deficit and look to cooperate, tensions in the region are manageable. India fears that it is being encircled. China on their part believes that if Nepal was to turn into a base for a superpower such as United States, its vital security could be compromised. It views the disputes in East and South China Sea, not to say the trouble in its Xinjiang region as a part of a larger plan to destabilize its rise.

China and India must make sure they build on the gains of BRICS and SCO and extend cooperation rather than confrontation. A part of Asia is already in ruins. If China and India were to go at each other’s throat—with Japan having similar plans against China, the whole region could be up in flames. It would be in no one’s interest—except for those who want to turn Asia as a “region of chaos.” We could then very well forget the notion that the 21st century belongs to Asia.

For starters, China could advice Nepal to address India’s legitimate concerns. India, instead of crying foul in public, should resort to backroom diplomacy. A failure here could lead to similar troubles in India’s other neighbourhoods. It must not happen.

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