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China’s Problem With Nepal

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The Pulse | Diplomacy | South Asia

China’s Problem With Nepal

Beijing is frustrated with the lack of progress in Nepal’s implementation of Belt and Road projects. But rhetorical bullying of its small neighbor won’t help.

China’s Problem With Nepal

Participants in the first Nepal-China Friendship Dragon Boat Race Festival that was held on June 23-24 in Pokhara, Nepal.

Credit: Twitter/ Nepal Tourism Board

China is rolling out global initiatives as if its “window of opportunity” is closing soon.

Almost a decade after President Xi Jinping introduced the Belt and Road Initiative (BRI) (then called One Belt One Road) in 2013, he announced three initiatives over the last three years. Beijing announced the Global Development Initiative (GDI) in 2021, Global Security Initiative (GSI) in 2022, and Global Civilization Initiative (GCI) in 2023. The initiatives have been led by Xi, marking China’s engagement with the rest of the world on Beijing’s terms.

The different initiatives cover different aspects of China’s engagement with the world and have lofty goals. The BRI is primarily about infrastructure connectivity, which has expanded consistently to include policy, trade, financial, and people-to-people connectivity. The GDI aims to “pool efforts to tackle challenges post-COVID recovery for achieving common sustainable development.” The GSI aims to “eliminate the root causes of international conflicts.” Meanwhile, the GCI advocates respect for the common values of humanity but the diversity of civilizations.

Across the Himalayas in Nepal, these Chinese initiatives pose opportunities and risks. Nepal desperately wanted to be a part of the BRI. As a result, China added the Trans-Himalayan Multi-Dimensional Connectivity Network to its BRI plans. The two nations signed the BRI agreement in 2017. Nepal leaders have sold the proposed rail network crisscrossing the Himalayas as Nepal’s ticket to end its complete dependence on India. However, there has been little development in implementing the BRI in Nepal since.

Meanwhile, two projects are already being implemented in Nepal under the GDI. At the same time, China has invited Nepal thrice and put pressure on it to join the GSI. However, Nepal has resisted the calls owing to its constitution-mandated policy of non-alignment. Nepal is studying Beijing’s invitation to be a part of the GCI.

However, Beijing is frustrated with Nepal’s lack of progress on BRI projects. It has become a primary Chinese concern. The Chinese government has grilled every visiting Nepali delegation about progress on the BRI, and the Chinese embassy in Kathmandu has pressed Nepali leaders here.

Beijing is keen to show that Nepal is progressing in the Beijing-led initiatives. Chinese ambassador to Nepal Chen Song claimed that Pokhara International Airport, built with Chinese aid and by a Chinese company, was a part of the BRI. Nepali Foreign Minister Narayan Saud clarified that “not a single project in Nepal under the BRI has been executed.”

Beijing also offered Nepal an olive branch as soon as Pushpa Kamal Dahal, also known as Prachanda, became the prime minister of Nepal in December 2022. China sent an expert team to Nepal to conduct a feasibility study of the Kathmandu-Kerung (Geelong) railway a day after Prachanda’s swearing-in.

As for the GSI, Beijing got then Nepali President Bidhya Devi Bhandari to deliver a six-minute speech at a GSI meeting last year despite reservations from the prime minister and the Ministry of Foreign Affairs of Nepal.

Similarly, Chen claimed that the Dragon Boat festival held in Pokhara in June 2023 was a part of the GCI.

There are various domestic and global reasons why Chen and the Chinese diplomats in Nepal are keen to claim and show progress.

First, the Chinese find the lack of progress and enthusiasm to implement BRI projects in Nepal befuddling. The Trans-Himalayan Multi-Dimensional Connectivity Network was added to China’s BRI plans at Nepal’s insistence. Nepali leaders have heavily sold the railway line linking Nepal to China as its ticket to end one-way dependence on India. The MOU to conduct a feasibility study of the proposed rail network was signed in 2019 during Xi’s historic trip to Nepal. Therefore, the statements could be Beijing’s way of putting pressure on Nepal to expedite the BRI projects.

Second, these are Xi’s initiatives. These initiatives represent Xi’s (and China’s) global ambitions, and he will be judged worldwide based on the success or failure of these initiatives. Thus, Beijing uses its diplomatic machinery to persuade countries to join and implement projects. Therefore, diplomats worldwide, Nepal included, are keen to report to Beijing that they are progressing toward Xi’s vision. In cases like Nepal, they have reported made-up progress where none existed.

Third, Nepal is a test case for China’s initiatives. Not only is it a neighbor of China but also it is a country where people largely perceive China positively. Therefore, Chinese diplomats do not want to lose face due to a lack of progress in the initiatives in its immediate neighborhood. What happens to these initiatives in Nepal could reverberate globally.

Fourth, China has an added impetus because Nepal ratified and has started the implementation of the Millennium Challenge Corporation (MCC), a $500 million U.S. grant project for infrastructure development. The agreement was signed at the same time as the BRI. It would be embarrassing for the Chinese government to see a project of a distant peer competitor successfully implemented, whereas its own projects remain in a limbo.

Therefore, Chinese diplomats in Nepal have taken the initiative to guide the narrative that BRI projects are being successfully implemented in Nepal. They are under pressure to save China’s face to a global audience and their own to their party seniors in Beijing. Hence, they are lumping any project carried out with Chinese aid or by Chinese companies under these initiatives, whether or not they were formally a part of the initiatives signed between the two countries.

China is not necessarily the only one to do so. Earlier, the debate on the MCC in Nepal was clouded by some U.S. officials remarking that the MCC was a part of the United States’ Indo-Pacific Strategy (IPS), implying that Nepal was already a part of the IPS.

However, Chinese diplomats are hardly winning over new friends in Nepal by attempting to bulldoze the narrative on these initiatives. While they have every reason to be miffed with Nepali leadership for their big talk but no progress on Sino-Nepali projects, rhetorical bullying is not the way forward.