The alliance between Pushpa Kamal Dahal aka Prachanda of the Communist Party of Nepal (Maoist Centre) and KP Sharma Oli of the Communist Party of Nepal (Unified Marxist-Leninist) is a marriage of convenience brokered by Beijing. It is an opportunistic alliance between two leaders who have a fractious history, unbridled personal ambitions and an intransigence of character that are unlikely to lend themselves to an enduring and fruitful administration.
Even before the recent elections in Nepal, China had been hyperactive in its efforts to forge a measure of unity among the country’s proliferating Communist factions, but had failed comprehensively, with Dahal preferring to go along with the five-party Joint Ruling Alliance, which included then Prime Minister Sher Bahadur Deuba’s Nepali Congress. Deuba’s party did emerge as the largest single party after the elections, with 89 seats, and a clear majority for the Alliance, but Prachanda, with just 32 seats, wanted to be prime minister. Oli, himself a former prime minister, with 78 seats in his party’s kitty and desperate not to sit in the Opposition, ceded the post to Prachanda on a ‘rotational’ basis, with each in the PM’s seat for two-and-a-half years—an arrangement that has failed dramatically in the past. Deuba has been denied, but stability appears to be a remote prospect in Kathmandu.
Nevertheless, the new arrangement has fuelled some speculation on the potentially adverse implications for New Delhi, since the Nepal Communists have tended not only to be hostile to India, but also to be particularly inclined in China’s favour. China is believed to have mid-wifed the present ‘deal’ between Dahal and Oli. Beijing’s influence in Nepal may now be decisive, and India is in for escalating friction with Kathmandu.
Nepal’s politics is a fragile balancing act, and so is its foreign policy. As a small country sandwiched between two giants, its vulnerabilities are real, but it has also learned to exploit Indo-China tensions, extracting a significant ‘rent’ from both. For the financial year 2022-23, for instance, India has allocated a grant of about NPR 12 billion to Nepal, while China has pledged NPR 15 billion in grant assistance. China has, however, made aggressive inroads in a number of spheres, creating a network of sympathetic media, non-government organisations, ‘research institutes’, as well as funding for the political process itself. Eventually, of course, China could bring far greater resources to bear in its efforts to force Nepal into its sphere of influence—particularly with a sympathetic government in place.
Beijing certainly has grand schemes for Nepal under its Belt and Road Initiative. There is, moreover, increasing mistrust, particularly of the financial terms of these projects, and this has only grown after the chaos that consumed Sri Lanka, as well as the capture of many of Colombo’s most prestigious projects by Beijing, when financial projections failed to materialise and debt-servicing became unbearable. The reality is, everything Beijing gives, comes with a price tag, and its actual value is hidden behind the opacity of the terms imposed by China, conditions that governments in Nepal have clearly expressed unwillingness to accept.
Beijing has, moreover, been playing mischief along the Nepal border, including encroachments on Nepalese territory in the far western Humla district. There is growing resentment against Chinese companies and their environmental and labour practices, border trade, and issues relating to Nepalese students pursuing courses in China. And there have been several protests against China’s policies and actions in Nepal. Essentially, no government in Nepal can blindly toe Beijing’s line, any more than it can be seen to succumb to New Delhi. There are certainly opportunities. Among his first statements in his third tenure as Prime Minister, Dahal has sought to keep the gates open on both sides.
What, however, needs to be understood is that simply harping on the deep ‘cultural and civilisational relationships’ between India and Nepal, will not suffice to counter China. The Nepalese have needs, aspirations and security concerns, and the country that is more willing and able to meet these will tend to secure influence in Kathmandu. India has always been the first and often most generous responder to Nepal in its times of crisis, and geography alone indicates that this will remain the case. Unless China is willing to bring far greater transparency and equity to its interventions in Nepal, it is unlikely that it will be able to exercise extraordinary control over any government in Kathmandu—Communist or otherwise. There may be periodic irritants for New Delhi, but Beijing also faces multiple challenges in Nepal.
Ajai Sahni
Executive Director, Institute for Conflict Management, South Asia Terrorism Portal
ajaisahni@gmail.com