Foreign Minister Shisir Khanal followed his customary visit to New Delhi with a routine trip to Beijing. A balancing journey to Washington may not be far behind. Educated in the United States, at the University of Bridgeport and the University of Wisconsin-Madison, Khanal brings to diplomacy the polished ease of the global NGO world: Suave, soft-spoken and wrapped in the charming simplicity of development activism. He probably also knows his limitations. On the eve of his departure for Beijing, he said his talks with Chinese leaders would focus on dispelling misperceptions about the RSP government’s foreign-policy orientation.

The Indian establishment offered red-carpet treatment to his party chair, Rabi Lamichhane, while the official response to Khanal was warm and cordial, but far from effusive. The Chinese will probably press for the implementation of past commitments, including the Belt and Road Initiative (BRI), rather than make fresh promises. The ‘pro-Western’ image of the Shah regime is likely to hinder its attempt to break new ground in improving relations with either China or India.

There is hardly anything new in the ‘pro-Western’ turn of South Asian countries, as Brahma Chellaney, a self-described geostrategist well known for his hawkish views on Pakistan and China, seems to imply in his assertion that Washington increasingly saw the world’s largest autocratic state less as a challenger to be contained and more as a peer superpower whose cooperation America now urgently needs. That has been so since the Nixon-Mao rapprochement of the 1970s helped produce a joint front against Moscow.

In South Asia, American alliance-building was aimed chiefly at containing the Soviet Union. Pakistan was a partner through the Central Treaty Organisation (CENTO), while Nepal had been friendlier to the Western camp of the Cold War since the 1950s. Both Islamabad and Kathmandu continued to court Beijing, with Washington looking the other way. The exception came when King Mahendra allowed the Central Intelligence Agency (CIA) to run its Khampa rebellion campaign from Nepali soil. The Khampa warriors were abandoned only after the CIA began to disown them following President Richard Nixon’s visit to Beijing in 1972.

Washington’s interest in South Asia may have faded after the Soviet collapse and the triumphalism of the so-called ‘End of History’. China, meanwhile, was being woven into the very fabric of global capitalism. After it entered the World Trade Organisation in 2001, it offered cheap labour, reliable infrastructure, political stability, export discipline and the promise of easy profits. In return, Beijing extracted technology, factories, jobs and industrial capability from the West, chiefly the US.

The 2008 subprime crisis changed the mood. As the American financial system staggered, China discovered its own weight. By the time BRI was launched in 2013, Beijing was no longer content to remain the workshop of the world. Despite the pandemic and mounting pressures at home, the challenge to Western hegemony has only grown more open.

The forces that built and benefited from the unipolar world are unlikely to yield to an emergent power without resistance. I use the term West India Company (WIC) as a metaphor for the alliances, interests and institutions—states, corporations, finance, security establishments, think tanks, media, donor agencies, sanctions networks and trade regimes—that operate below the surface to withstand the Chinese challenge.

Power matrix

More than four centuries after Queen Elizabeth I granted the East India Company its royal charter on December 31, 1600, another imperial-commercial formation has taken shape. The WIC has no flag, no monarch, no charter, no headquarters and no single board of directors. Yet its reach is unmistakable.

Its roots can be traced at least to the Bretton Woods institutions, but it came into its own with the Washington Consensus, when trade, investment, conditional lending and market access began to replace aid as the preferred instruments of hegemony. After the dismantling of USAID and the resulting shock to the aid industry, the power of less visible instruments—finance, sanctions, ratings, investment rules and strategic philanthropy—has only increased.

At times, this dispersed formation may even help engineer regime change—sometimes through independent contractors for plausible deniability—to secure higher profits or serve the interests of a powerful patron. Unlike its chartered predecessor, it cannot be summoned before one parliament or disciplined by one electorate. Its power lies precisely in its dispersion. To understand contemporary geopolitics, one must look past the comforting language of cooperation, development and rules-based order, and examine the transactional machinery through which wealth is extracted, dependency is managed and political leverage is produced.

It is not that clandestine funds no longer flow into electoral contests that form parliaments or produce electoral authoritarianism. Rather, local business interests are mobilised to help erect legitimate authority—often a demagogue or a populist, sometimes both—on the Y-axis of power.

Along the X-axis, several political parties are assisted in strengthening their organisations to maintain the façade of competitive politics. This also gives the WIC the ability to replace one formation with another when ambitious politicos become too big for their boots or when scandal hits its favourite vehicle.

More important than the legitimate hierarchy on the vertical axis or the supporting organisations on the horizontal axis, however, is the third dimension: The oligarchic control of media and the intelligentsia. In a two-dimensional framework, the Z-axis is the most powerful precisely because it remains unseen.

Hindutva triad

The Hindutva power matrix is easier to see in India. The century-old Rashtriya Swayamsevak Sangh (RSS), unregistered anywhere but headquartered in Nagpur, provides the ideological footing and organisational depth of committed cadres on the X-axis. The Bharatiya Janata Party, claiming to be the world’s largest political party, occupies the Y-axis of formal authority under Prime Minister Narendra Modi, though the party machine appears to be disciplined as much by Home Minister Amit Shah as by its former president. The plutarchy—symbolised by the corporate empires of Adani, Ambani and other powerful oligarchic interests spread across Bengaluru, Mumbai, Hyderabad and Surat—operates on the Z-axis through monetary muscle and media power, producing an unprecedented concentration of influence.

This convergence of capital and ideology has been cemented by the repurposing of state instruments. Critics argue that the Election Commission and the Enforcement Directorate no longer function as autonomous arbiters or investigators, but increasingly as tactical extensions of the ruling regime—used to induce compliance, harass opponents or manufacture scandals that push the opposition toward irrelevance. The atmosphere of pre-poll malpractice, including controversy over the special intensive revision (SIR) of electoral rolls in West Bengal, has added another layer to the construction of Modi’s aura of invincibility.

With firm control over the vertical axis and the full support of the oligarchs, Modi has implemented much of the ideological agenda of the base while politely refusing to be answerable to Nagpur. Perhaps the Modi magic over the electorate has begun to fade. The ideologues and moneybags constituting the Indian subsidiary of the WIC may now want to ease him towards the Margdarshak Mandal. The celebration over a technical record—4,399 uninterrupted days in office as an elected prime minister—may be preparing the ground for his farewell rather than merely honouring his endurance.

The performative reception accorded to RSP chair Lamichhane, including high-level meetings with National Security Adviser Ajit Doval, External Affairs Minister S Jaishankar and Prime Minister Modi himself, was largely optics. Sewa Teerth is fully cognisant that it is not merely the government, but the regime itself, that has changed at Singha Durbar. Both sides are weighing each other: Shah indulges in aura farming, while the WIC increases pressure to bring him to the negotiating table.

Indian mangoes, Nepali tea leaves and chemical fertilisers are administrative matters. Chinese Foreign Minister Wang Yi reportedly told Khanal that distant relatives were not as good as close neighbours. It is not known whether he also reminded him of what every Chinese strongman since Chairman Mao has impressed upon Nepali interlocutors in one form or another: Relatives are important, neighbours are more important, but maintaining cordial relations with the closest neighbour, who also happens to be a relative, is most important for the sovereignty, integrity and prosperity of a country such as Nepal. That, however, is a call premier Shah will have to take himself—once he finds time for the urgent business of governing between chilling, shitposting and curating his own spectacle.