29 August 2024, NIICE Commentary 9465
Sakshi Rathi
The Shifting Geopolitical Dynamics in South Asia
The geopolitical dynamics in South Asia are rapidly shifting, presenting new challenges for India. Intense protests, economic difficulties, illicit trade, terrorism, and an assertive China are increasingly putting pressure on India’s regional influence. The Indian government’s strategy of maintaining regional hegemony by supporting pro-Indian governments has not yielded the desired outcomes. This complex scenario can be likened to a “ring of fire,” symbolizing the encircling pressures and threats facing India.
In response to these evolving dynamics, India has recalibrated its approach, adopting a more proactive stance toward its neighbors while simultaneously positioning itself as a ‘Vishwa Guru’ on the global stage. The Indian government has maintained its influence in the region, but recent political shifts, such as the leadership change in the Maldives under Mohamed Muizzu, the return of K.P. Oli in Nepal, and domestic turmoil in Bangladesh, have emerged as critical security concerns for regional stability, particularly for India. This context underscores the necessity for India to shift its policy from relying solely on pro-India governments to engaging constructively with all governments while asserting its leadership in South Asia.
Vikram Misri’s Diplomatic Visit: Significance and Context
Against this backdrop, the visit of India’s Foreign Secretary, Vikram Misri, to Nepal from August 11-12, 2024, gains particular importance. Invited by Nepal’s Foreign Secretary, Sewa Lamsal, Misri’s visit aligns with the ongoing practice of regular high-level exchanges between India and Nepal. As a key partner in India’s ‘Neighborhood First’ policy, Nepal holds strategic importance, and Misri’s visit underscored the need to align strategic priorities and enhance mutual understanding, especially under the renewed leadership of K.P. Oli.
The Return of K.P. Oli and the Nepal-India Dynamic
K.P. Oli, Chairperson of the Communist Party of Nepal (Unified Marxist-Leninist), is now serving his fourth term as Prime Minister. His party, CPN-UML, has formed a significant alliance with the Nepali Congress, led by Sher Bahadur Deuba. This coalition, commanding the majority in Nepal’s Parliament, holds the potential to realize the vision of a “Prosperous Nepal, Happy Nepali,” with ambitious goals including transforming Nepal into a middle-income country by 2030 and a developed country by 2043. This vision aligns with India’s objective of maintaining stability and peace in its neighborhood, making cooperation between the two nations even more crucial.
However, Nepal’s position between two emerging economies and Asian giants, India and China present unique challenges. Often described as suffering from the “small state syndrome,” Nepal must carefully navigate its internal and external security challenges as Nepal’s geostrategic location offers both opportunities and challenges. Political maneuvering in this context can be easily misinterpreted, particularly in relation to India, leading to perceptions of India as overly interventionist in Nepal’s internal affairs.
Historical Context: The Nation-State and Sovereignty
The concept of the ‘Nation-State,’ solidified by the Treaty of Westphalia in 1648, introduced the ideas of sovereignty and territorial integrity. As a sovereign state, Nepal has the right to manage its internal dynamics independently. However, the reality of geopolitical interdependence, where any security threat in Nepal has broader implications for South Asia especially India, creates a complex dynamic. India’s actions are often perceived through the lens of strategic necessity, but they can be misinterpreted as interventionism, leading to the view of India as a “big bully”. This perception has led to oscillations in the bilateral relationship, ranging from close cooperation to significant tension.
During K.P. Oli’s earlier terms, his tenure was marked by significant tensions with India. One major point of contention was his government’s accusation that India imposed an unofficial blockade in 2015-16, which worsened the humanitarian crisis following Nepal’s devastating earthquake. Relations further deteriorated when Nepal unveiled a new political map that included Kalapani, Lipulekh, and Limpiyadhura within its borders. This move came shortly after India had released its own political map, placing Kalapani within Indian territory. These developments deepened mutual distrust and strained ties, particularly over disputed territorial boundaries.
A New Chapter: Cooperation and Mutual Benefit
Recent developments, however, suggest a thawing of this relationship. The visit of Nepal’s Foreign Minister Dr. Arzu Rana Deuba to India, at the invitation of India’s External Affairs Minister Dr. S. Jaishankar from 18-22 August 2024, is a testament to the skillful management and careful articulation of prevailing issues between the two nations. This visit coincided with significant unrest in Bangladesh, where the ousting of a secular prime minister and rising mob violence against minority Hindus posed security concerns for both Nepal and India. The unrest also raised the potential for a large-scale refugee crisis, underscoring the need for close cooperation between the two neighbors.
Dr. Arzu Rana Deuba’s visit also marked a new achievement in the India-Nepal Energy Trade sector, with an additional 251 MW of electricity import, bringing Nepal’s energy exports to nearly 1000 MW. According to estimates by Chandan Kumar Ghosh, this export revenue could increase to Rs 27 billion in the current fiscal year if the additional power exports are successful. This development follows the long-term energy deal announced by Indian Prime Minister Narendra Modi during Nepalese Prime Minister Pushpa Kamal Dahal’s visit to India in May-June 2023, where India agreed to buy 10,000 MW of electricity from Nepal over the next ten years. Further, the recent facilitation of providing training for the Nepali cricket team at the National Cricket Academy, Bengaluru represents the new gamut of cooperation. This development aligns with Indian Prime Minister Narendra Modi’s long-term vision of fostering regional development and stability through economic cooperation i.e., ‘sabka saath, sabka vikas’, extending to India’s neighborhood as well.
Pragmatism in K.P. Oli’s Recent Stance
In the broader context, K.P. Oli’s recent stance appears to be one of pragmatism. While his earlier terms were marked by tension and accusations against India, his current approach reflects a shift towards cooperation and mutual benefit. The new coalition government in Nepal, led by CPN-UML in alliance with the Nepali Congress, may provide a more stable platform for fostering positive bilateral ties with India.
India, as a significant market and investor, plays a crucial role in Nepal’s ambition to become a developed country by 2043. This relationship can be better understood through the lens of Political Modernization Theory, which posits that as nations modernize, their focus shifts from conflict to collaboration, especially when economies of scale are at play. Accordingly, interdependence between nations, particularly in economic development, reduces the likelihood of conflict, as both nations recognize that mutual growth benefits all parties involved.
Conclusion: A New Chapter in India-Nepal Relations
In this context, shared goals of economic development and regional stability have opened a new chapter in India-Nepal relations. Both nations are leveraging their strengths to address common challenges. India’s investment in Nepal’s infrastructure and key sectors is aimed not just at economic gain but also at fostering regional stability. As Nepal develops, economies of scale encourage cooperation over conflict. India can further leverage its position by recalibrating its approach to embrace more inclusive and equitable partnerships, especially in light of the ongoing unrest in South Asia. By deepening diplomatic engagement and supporting Nepal’s domestic priorities, India can strengthen its influence while promoting a stable and prosperous neighborhood.
Thus, the evolving India-Nepal relationship is a testament to the idea that economic interdependence and shared goals can create a more peaceful and prosperous regional environment, benefiting both nations as they move forward together.
Sakshi Rathi is Visiting Fellow at NIICE.
