A Nepal-China Transit Treaty Alright, but India Should Not Worry

Nepalese Prime Minister K P Oli concluded a successful visit to China last week. This was his second visit abroad after assuming office and follows a state visit to India a few weeks earlier.The joint statement at the conclusion of the visit contains the usual anodynes to assuage each other’s sensitivities. The previous such joint statement following the Nepal visit of Premier Wen Jiabao in 2012, during the prime ministership of Baburam Bhattarai, was perhaps even more euphoric in tone. Assertion of its sovereignty is important for Nepal, while China continues to require reiteration of ‘one China’ policy from others. Nepal’s commitment not to permit its territory to be used by any anti-Chinese or separatist forces is, of course, directed at Tibetan refugees. In the past, China has shown itself to be extremely sensitive in its dealings with Kathmandu.Major TakeawaysThe Nepali media have focused on the wholehearted Chinese welcome to the promulgation of the constitution, as compared with the rather formal Indian response. However, it must be noted that the welcome also expresses the sincere hope that “Nepal could take this opportunity to realise its political stability and economic development.” This is a nuanced statement. Judging by Chinese assurances to the Madhesis, following anti-Chinese demonstrations, it is not unlikely that Beijing’s advice to Oli may not have been very different from India’s stated position on the need to arrive at a compromise solution.A large number of issues were discussed during the visit, paving the way for some agreements. These were related to trade, where the Chinese promised to look into the possibility of freer access, cross-border connectivity, infrastructure development, investment, post-earthquake reconstruction, energy, tourism and business. Besides the Chinese promise to look into various Nepali requests, there does not appear to be anything tangible or immediately productive. Many have been under discussion or implementation (as in enhancing road linkages) for quite some time. Extending Chinese rail network to Nepal is likely to be a long-term project, involving economic viability as also Chinese security concerns with respect to Tibet. A major takeaway for Nepal was the Chinese agreement to offer transit facilities for third country goods. For this purpose, Tianjin would be the designated Chinese port. Nepal has decided to open a consulate in Guangzhou for trade facilitation. It is not clear when this route would become operational. Tianjin is 3,000 kms away from Kathmandu, as compared to 1,000 kms from Kolkata.Flashing the China CardThe Nepali media have focused on the wholehearted Chinese welcome to the promulgation of the Constitution, compared to formal Indian response.It was expected that an agreement on fuel supply would emerge during PM Oli’s visit, however this did not happen.Even the seasoned Nepali commentators suggest that the Chinese did not agree for a deal on supply of fuel due to pressure from India.Oli’s visit to China comes in the backdrop of the Madhesi agitation when it was suggested that Nepal must reduce dependence on India.From an Indian perspective, a more self-assured Nepal provides the possibility of balanced state-to-state relations.No Solution to Fuel CrisisEver since the interruption of trade across the border started in October, following the Madhesi protests in the Terai region (invariably called a blockade by the Nepali establishment and media, and unthinkingly copied by the Indians), the lack of fuel hit Nepal hard. On Nepal’s request, the Chinese sent a consignment as gift, adequate for a day or two. Nepal urgently sought a long-term purchase agreement and high-level delegations visited Beijing. Commercial terms could not, however, be agreed upon. It was widely reported, and expected, that such an agreement would emerge during Oli’s visit. This did not happen, and the prospect remains subject to finalisation of mutually acceptable commercial terms. It is arguable that Oli has not succeeded in obtaining Chinese concurrence to the single most important and urgent item on his agenda. Victim of Indo-PhobiaThe Indian spectre continues to haunt even the minds of otherwise seasoned nationalist Nepali commentators who suggest that the Chinese did not agree for a deal on supply of fuel due to pressure from India. It appears more likely that the Chinese wish to make a distinction between high profile gifts, be it out of affection or politics, and long-term commercial commitments. Pleas that India should not stand in the way of improved Sino-Nepal relations fall in the same category of Indo-phobia. Oli’s China visit had a unique importance. Following the Madhesi agitation and disruption of trade, it was repeatedly stated that Nepal must break out of dependence on India and that China provides the answer. It was intended to reassure the Nepali public as well as deflect criticism of the government’s own shortcomings, cause nervousness to many in India who are prone to suffer from excessive concern regarding China and, consequently, mute India’s support for the Madhesis’ just demands. Positives from Oli’s VisitSurely, China, like any other country, would seek to gain advantages where it can, but that should not be the only determinant of Indian policies. The China card has been sought to be ominously flashed since the time of King Mahendra and Oli is to be commended for his courage in putting it on the table. There are positives from the Oli visit for both Nepal and India. If the many possibilities of Sino-Nepal relations do fructify, when they do, they would be beneficial for the people. With a new transit route being made available, it should provide greater self-assurance to Nepal in dealing with India without feeling claustrophobic and is a psychological boost. From an Indian perspective, a more self-assured Nepal provides the possibility of balanced state-to-state relations, which are not hostage to emotions or personalities, each seeking to pursue its national interests. This seems to be very much on the same lines as the Chinese do. (The writer, a former Indian ambassador to Nepal, is the author of ‘Magic of Nepal’)Also read:Nepal’s Otherwise Admirable Constitution is Steeped in Inequities

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A Nepal-China Transit Treaty Alright, but India Should Not Worry

Nepal Prime Minister K P Oli’s China visit hasn’t charted any course that should worry India, writes Deb Mukharji.

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Topics: Nepal Xi Jinping Li Keqiang