The year the Sino-US tussle came to KathmanduStuck between Indo-Pacific and BRI, it is in Nepal where the US-China trade war has manifested itself.
The year 2019 will probably be defined as the year Pax Americana met with its greatest challenge since the heydays of the Cold War. The Pax Sinica as envisioned by Beijing through its Belt and Road Initiative (BRI), found acceptance even among nations traditionally part of the American-led global order. Although the trade war between the US and China has curtailed some of the latter’s economic ambitions, it is increasingly clear that trade and economic matters alone will not determine the winner. The US is playing up the fact that China has several soft spots—Tibet, Xinjiang, Taiwan and Hong Kong—and the next round in their battle for global spoils will see pressure tactics, such as the recent American bills on Xinjiang and Hong Kong demanding sanctions for human rights violations.
In South Asia, it is in Nepal where the US-China tussle has clearly manifested itself. Not since the CIA funded Tibetan guerrillas and the Indians and the Chinese competed for influence in the 1960s has Kathmandu found itself in the geopolitical spotlight. However, the key takeaway has been a prevarication on whether Kathmandu is part of the Indo-Pacific security arrangement, or whether it simply committed to receiving economic assistance under the scheme. For, while the tilt towards Beijing is increasingly clear, what is not is the roadmap Kathmandu has in mind for managing its international affairs and foreign policy direction. More and more, it’s seeming like a case of having a finger in every pie, a situation that might deliver in the short run, but as these two powers begin asking questions on allegiances and alliances, will be difficult for us to resolve in the long run.
The other question is whether the security establishment and the political and bureaucratic class are aligned on this issue, as an analyst recently told me. Signals indicate while the security cooperation with Beijing is still broadening its scope, Washington wishes to deepen the existing relationship, as can be seen in the recent gifts of two ‘sky-trucks’ to the Nepal Army and the statement attributed to the defence minister that ‘Nepal is positive about joining the State Partnership Program of the Indo-Pacific’.
Such equivocation isn’t unusual for a country like Nepal. As former chief of army staff, General Gaurav Rana said in an interview to The Record early last year, ‘Nepal’s approach to the world is more realist than idealist in nature… [China’s rise is an] opportunity… However, the challenge comes in being able to balance the concerns of India—that’s number one—and next, the US.’ This interview gives us excellent insight into our establishment’s thought process; the challenge is to balance great power expectations while negotiating the tricky terrain of neighbourhood geopolitics. After all, Delhi is not sitting by twiddling its fingers while Washington and Beijing fight for influence in Kathmandu.
The lack of movement on any of the projects outlined under the BRI is a worrying sign. Charges of Chinese ‘debt trap diplomacy’ have been dismissed as coming from a ‘negative attitude towards China’ aimed at ‘instilling psychological fear’ in Nepal by the foreign minister himself, an opinion also voiced by an unnamed Nepali ‘diplomat-turned-scholar’ in a recent survey on perceptions of BRI among member countries. How are such negations to be understood amid the newfound tentativeness towards BRI projects? Is it just our ‘weak institutional capacity’ that has stalled negotiations?
In the survey on perceptions about BRI, Nepali respondents were among the most optimistic and saw the initiative as an opportunity. But most importantly, eight out of ten Nepali respondents thought BRI countries needed to prepare a ‘national infrastructure development strategy’ to engage with China in a more organised manner. This, combined with our insipid movement on BRI, suggests that the initial commitments made were more of a political decision, and specific project-related negotiations were not carried forward.
This then leads us to similarly query our wrong-footedness on the Indo-Pacific strategy, which remains an amorphous idea. ‘The Indo-Pacific strategy is simply the name we have given to everything we do in the region, and security is an important part of ensuring the Indo-Pacific Region remains free and open,’ explained US ambassador to Nepal Randy Berry in September this year. But the Millennium Challenge Corporation (MCC) compact, which Nepal signed in 2014 and has been the key agreement that brings Nepal under the Indo-Pacific, was primarily intended for infrastructure development. Kathmandu’s delinking of the MCC from the Indo-Pacific is a nuanced take, but it will not absolve it when Beijing asks questions of it, especially in an era when the US National Security Strategy identifies China and Russia as countries that ‘want to shape a world antithetical to US values and interests.’ The same document is clear on American goals in South Asia, one of which is that the US ‘will help South Asian nations maintain their sovereignty as China increases its influence in the region.’
What is, however, clear is that the Sino-US tussle has put aside the India-China strategic contest in the South Asian neighbourhood for now. Rather, Delhi is watching how the contours of the new multipolar world develop, and engaging with both the parties on its own terms. This has important implications for Kathmandu, for there are suggestions that Delhi is no longer ‘against [its neighbours’] policy of engaging more players to maximise benefits,’ meaning it longer sees engagements with Beijing as automatically being against Delhi. At the same time, Delhi will not cede ground on its key interests.
For Nepal to then maximise its current position in a rapidly changing world order, it needs to first improve its capacity to negotiate for better deals. It must assure other powers, especially our neighbours, that their concerns remain a priority—a ‘neighbourhood first’ policy, in sum, that keeps in mind the global power struggle. Prachanda’s statement that trilateral cooperation with India and China rather than a ‘2+1’ arrangement provides a roadmap; but again, unless our institutional capacity is strengthened and our policies aligned, next year will be full of surprises for us.
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