The Rastriya Swatantra Party (RSP), which is set to head a majority government in the coming weeks, has vowed to pursue a policy of “development diplomacy”.

After the March 5 parliamentary elections, RSP chief Rabi Lamichhane stated that the government formed under his party’s leadership would strictly implement a non-aligned foreign policy focused on development diplomacy. His statement has sparked curiosity about what it actually means and entails.

On March 7, speaking at a gathering in Chitwan, Lamichhane, after being elected from Chitwan-2 constituency for the third time, stated that the party will remain firmly committed to a balanced foreign policy based on mutual respect.

A Nepali diplomat, who holds a PhD in economic diplomacy, told the Post that development diplomacy is relatively a new term in the international development sector and focuses on development without any geopolitical or security strings attached.

“Mostly, it is attached with development components like education, information technology, agriculture, health, and other social development projects without any political strings attached. As many projects started coming with conditions from bilateral donors, the only focus of development diplomacy has evolved to social and infrastructure development without any political interests,” the diplomat added.

In the past, some foreign aid and assistance became controversial and this prompted calls for caution among smaller nations like Nepal. For example, the US Millennium Challenge Corporation which has brought an investment of $550 million was dragged into controversy. China's Belt and Road Initiative and India's High Impact Community Development Projects are also criticised for perceived strategic interests.

RSP now wants to avoid such controversies while taking assistance for development projects.

Lamichhane, while thanking his voters, stated that the RSP would introduce special policies to create a favourable investment climate and ensure full protection for investors.

In its 100-point election manifesto, the RSP has set several targets: seven percent annual growth, a per-capita income of above $3,000, and expanding the economy to $100 billion within five years. The party has also promised reforms to attract investment, simplify the business environment, and ease financial regulation.

Development diplomacy is also used in development cooperation, such as aid, infrastructure projects, and technical cooperation, to achieve foreign policy goals.

Ashbinkumar Pudasaini, who holds a PhD in economic diplomacy, told the Post that development diplomacy refers to cooperation on the development agenda, maintaining relationships among bilateral and multilateral development agencies, and ensuring support for achieving sustainable development goals.

“Development diplomacy is a form of public and economic diplomacy for foreign direct investment and has been practised as a means of development support to the developing countries through grants, technology transfer, soft loans, and capacity building,” he told the Post.

It also honours commitments to the United Nations, United Nations Development Programme, World Bank, International Monetary Fund, Asian Development Bank, and other similar agencies that support developing nations, he said.

Lamichhane said his party would align development priorities, foreign policy objectives, and private sector interests. In his address, he sought to reassure the international community, saying his party would remain firmly committed to a balanced foreign policy based on mutual respect.

“By cooperating in development, our relations will reach new heights. The RSP’s policies will protect and safeguard the private sector. RSP will continuously work to create an environment for domestic investment and to ensure investment security,” he said.

Semanta Dahal, an legal expert and development consultant for large infrastructure projects, said the RSP is likely to shift the focus of India-Nepal relations from historical commonalities, shared civilisations and deep-seated familial, cultural and social ties.

“It intends to shift the emphasis towards relying on the blueprint of India’s economic transformation to accelerate Nepal’s own development. It could entail development aid [loans and grants], lines of credits, the Indian Technical and Economic Cooperation programme, and private investments from India,” said Dahal.

As per RSP’s manifesto, it will renew development partnership models so Nepal can benefit from the rapid progress made by India over the past decade, particularly in digital public infrastructure, high-speed and high-quality physical infrastructure, economic formalisation, balanced growth between manufacturing and services, and overall state capacity enhancement.

At the same time, RSP aims to build structured partnership frameworks with China by mobilising concessional finance for world-class infrastructure, adopting state-guided socio-economic development programs, and learning from effective inter-provincial competition models. Through this balanced approach, RSP seeks to ensure national interest while positioning Nepal as an active, confident, and development-oriented partner in the region, as per the manifesto.

Aneka Rebecca Rajbhandari, a Yenching Scholar at Peking University and co–founder of Araniko Project, told the Post that development diplomacy means socio-economic development assistance, which could also include different kinds of aid and grants to foster state relations.

Regarding practical use, she said it could cover hydropower, roads, trade, and border infrastructure development, as well as technical and vocational education/human resource training, university exchanges and disaster preparedness.

Pudasaini added that development diplomacy is coordinated through the government-to-government, government-to-private sector, agency-to-agency, people-to-people, and relationships among economic actors between countries.

Rajbhandari said the term is often used interchangeably with development cooperation.

“Development diplomacy is essentially the same as development cooperation, a term which is more familiar to China. Chinese government documents on aid and cooperation frame it that way, but the purpose of the two terms is the same,” she said.

The RSP needs to clearly decide whether to focus on human resources, infrastructure, or other areas, she says.