China Nervous About Nepal’s Resolve To Strengthen Ties With India And USA

China, which had tried its utmost to bring Nepal into its exclusive sphere of influence, is now apprehensive of the Himalayan nation’s resolve to improve ties with India and the USA.

Beijing’s nervousness over the Sher Bahadur Deuba government’s firm intention of bringing its relations with India back on track and its growing closeness with Washington became apparent at a recent meeting between top officials of both the countries.

China had managed to bring Nepal under its spell during the rule of the communist Prime Minister Khadga Prasad Sharma Oli, during which ties with India weakened considerably. Beijing had also forced Kathmandu to desist from signing the Nepal compact of the Millenium Challenge Corporation under which the US will extend a US $500 million grant to Nepal for producing clean energy, undertake climate change mitigation measures and for power and infrastructure projects.

Oli had staved off signing the agreement for the US grant at China’s behest. But the Nepali Congress government led by Sher Bahadur Deuba ultimately ratified the agreement in late February this year. China has not taken too kindly to Kathmandu defying its wishes and trying to forge closer ties with Washington.

Tibetan refugee issue

At the 14th meeting of the Nepal-China Bilateral Bilateral Consultative Mechanism held last week, the Chinese side reportedly nudged Kathmandu to continue with its One China policy and guard against ‘internal or external factors’ influencing the policy in any manner.

This exhortation comes in the wake of a senior US official meeting Tibetan refugees in Kathmandu during an official visit to Nepal. US Under Secretary for civilian security, democracy and human rights, Uzra Zeya, met Tibetan refugees in Nepal’s capital in the third week of this month.

Zeya also serves as the Special Coordinator for Tibetan Issues in the Biden administration. Before flying to Kathmandu, Zeya had traveled to Dharamshala--the seat of the Tibetan government-in-exile in India’s Himachal Pradesh--on May 18 and met the Dalai Lama as well as senior religious and political figures of the Tibetan community there (read this and this).

Soon after reaching Kathmandu, the US official visited the Tibetan refugee settlement at Jawalakhel near Kathmandu where, apart from Tibetan refugees, she also met human rights activists and discussed the problems faced by the community in Nepal. Zeya wrapped up her visit to Nepal on May 21 by visiting the Bouddha area in Kathmandu where a large number of Tibetan refugees live (see this).

Representatives of the Tibetan refugees complained to the visiting US official that about seven thousand of the fifteen thousand refugees in Nepal had not been provided refugee identity cards and other documents by the Nepal government. This has put them in a severe disadvantage in securing admissions to educational institutions, getting jobs, traveling abroad or engaging in many social activities.

Under pressure from China, Nepal had stopped issuing identity cards to Tibetan refugees in 1995. The USA and some Western nations have been urging Nepal to issue identity cards to the refugees and the Nepalese establishment is divided over this sensitive issue.

Tibetan refugees are a highly sensitive issue in Nepal and the government has very often bent over backwards to please Beijing by dealing harshly with the refugees. Nepal prohibits refugees from celebrating the Dalai Lama’s birthday or observing the anniversary of the 1959 uprising that followed China’s conquest of Tibet.

Beijing is sensitive about how Nepal, or other countries (including India) handles Tibetan refugees. The Chinese have been leaning hard on Nepal to abandon its policy of non-refoulement under which Kathmandu does not push back Tibetans who escape to Nepal from harsh Chinese rule. This policy is part of an informal agreement between Nepal and UN agencies as well as some Western governments (read this).

Zeya’s meetings with Tibetan refugees were brought up by the Chinese side, which was led by Chinese assistant foreigh minister Wu Jianghao. The Nepalese delegation, led by foreign secretary Bharat Raj Paudyal, had to go to great lengths to clarify that the US official’s meetings did not have Kathmandu’s formal approval. The Nepalese delegation also had a tough time assuaging China’s concerns over Nepal ratifying the Millenium Challenge Corporation (MCC) compact.

Nepal has, over the past few months, seen a flurry of visits by US officials. The frequency of these visits went up after Nepal’s parliament ratified the MCC agreement that the country had signed with the USA in 2017.

In September last year, MCC Vice President Fatema Z Sumar landed in Kathmandu to urge the political leadership to get the agreement ratified. Two months later, US Assistant Secretary of State Donald Lu also flew into Kathmandu with the same message to Nepal’s leadership: Ratify MCC.

Lu later called up Prime Minister Deuba, CPN-UML chairperson and former premier Oli as well as Maoist leader Pushpa Kamal Dahal with an ultimatum: that if Nepal failed to ratify the MCC agreement, Washington would be forced to review its ties with Nepal.

This had its desired effect and Deuba managed to get other political parties on board to ratify the MCC agreement in the nick of time.

China wasn’t pleased at all. Beijing had spoken out against the MCC on a few occasions in the past. A month after the MCC’s ratification by Nepal’s parliament, Chinese foreign minister Wang Yi traveled to Kathmandu to push Nepal into identifying projects for implementation under Chinese President Xi Jingping’s pet Belt & Road Initiative (BRI) project.

But Yi encountered a strong reluctance by the Nepal government in initiating any projects under the BRI. Yi’s attempts to sugarcoat the BRI also did not have the desired results. Nepal has, according to observers, become wary of BRI, especially in wake of Sri Lanka’s disastrous dealings with the Chinese.

What would have rankled the Chinese even more is that prime minister Deuba, immediately after snubbing Wang Yi, flew to New Delhi where the red carpet was rolled out for him.

Washington rewarded Kathmandu for ratifying the MCC by increasing the quantum of aid through the US Agency for International Development (USAID) to Nepal to US $ 659 million.

Last month, a US Congressional delegation visited Kathmandu. Prime Minister Deuba will visit the US in mid-July, making it the first visit by a Nepalese premier to the USA in twenty years.

In between, two more delegations of US officials are scheduled to visit Kathmandu. Simultaneously, Nepal has also stepped up bilateral engagement with India and visits between officials of both the countries have increased appreciably.

Beijing is, understandably, nervous about Kathmandu’s growing proximity with both New Delhi and Washington. It is trying its best to retain Nepal within its sphere of influence, but the Nepalese establishment has become wary of China. Especially after the crisis that has engulfed Sri Lanka; the grave crisis that the island nation is in the midst of is perceived to be the fallout of implementation of BRI projects that has pauperised the country.

China has also held out many sops to Nepal of late. But its handouts and renewed overtures are yet to be met with the same amount of enthusiasm as they used to be in the past under communist rule.

This is good news for India, which is also rebooting its ties with Nepal.