Analysis

China majorly increasing footprint in Nepal: Experts

Nepal-China

China has not only made deep inroads into Nepal, with major investments in the Himalayan country’s infrastructure, it is also getting closely involved in Kathmandu’s security and political architecture, with top officials from Beijing visiting Nepal regularly, experts said here.

At a talk on ‘An Assessment of Nepal China Relations’, former Indian envoy to Nepal Ranjit Rae said while China was increasing its footprint in Nepal, “but it is not large enough to dent the nature of India-Nepal relations”.

According to Professor S.D. Muni, one of the main reasons for China’s outreach into Nepal was due to its “sense of vulnerability” with regard to Tibet and that Kathmandu “gets panicky” over the subject of the Dalai Lama.

Rae, who was the Indian ambassador to Nepal at the time of the five-month border blockade, said China’s involvement in Nepal was visible in the economic, defence and political spheres.

“China is the single largest FDI source for Nepal, and its presence is not just there in small projects, but in substantive ones, like cement, airports, roads, transmission lines, railway, optical fibre network. China’s economic involvement in Nepal is significant,” Rae, who is currently a member, Commonwealth High Level Group on Governance, said at the talk.

Chinese banks have also opened in Nepal and the two-way trade between the two neighbours is at the ratio of 45:1, heavily tilted in Beijing’s favour.

People-to-people connect between the two was increasing at a rapid pace, with lots of Chinese tourists visiting Nepal, especially Pokhara.

Trans-border connectivity between the two nations, which share a 1,400 km border, was also most significant, he added. The Nepal-China Trans-Himalayan Multi-dimensional Connectivity Network (THMCN) is part of China’s ambitious Belt and Road Initiative.

The proposed 170 km trans-border railway line is to connect Kerung in southern Tibet to Kathmandu and then to Lumbini on the Nepal-India border.

China and Nepal also held joint military exercises for the first time, and Beijing is supplying arms and equipment to the Nepalese side. The Chinese Defence Minister visited Nepal and the two sides hold regular exchanges.

But it has been a while since an Indian Defence Minister visited Nepal, the experts said.

In the political sphere too, China has a strong presence in Nepal, and a strong outreach with the Madhesi parties. The unification of the two Communist parties also had the “strong backing of China”.

According to Muni, Professor Emeritus, Jawaharlal Nehru University and former Indian Ambassador to Laos, China’s outreach into Nepal was “part of its overall global and Asian strategy”.

He said the Chinese were “driven by a sense of vulnerability” with regard to Tibet and the restive Xinjiang province in western China.

With regard to China’s deep inroads into Nepal’s economy, Muni said it was largely driven because the Chinese companies had reached “saturation point” and Beijing wanted them “to remain engaged”.

“With the Chinese growth sliding and the high demand for natural resources by its companies, combined with the demand for new markets to feed on, China has set its sights on South Asia,” said Muni.

South Asia, comprising a region with 1.6 billion population with 5-7 percent growth rate, “is a huge market”, in Beijing’s eyes.

China is also concerned about the “Malacca dilemma” – the Strait of Malacca, a key Asian sea trade route and major choke point, and is seeking to resolve the matter through its involvement in the Gwadar port in China, Humbantota in Sri Lanka and Sittwe in Myanmar, Muni said.

“China does not want South Asia to gang up with the US against it,” he said, adding that a major motive behind Beijing’s involvement in Nepal was to “keep India in place”.

From Economic Times

Published on Lokantar on 25 July 2019

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