Tag Archives: Nepal

At the Gateway from East: Where do India’s Neighbours stand on the Belt and Road?

ISSSP Reflections No. 55, June 19, 2017

Author: Seetha Lakshmi Dinesh

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How do India’s neighbours look at the One Belt One Road (OBOR) initiative of China? What is the current politico-economic framework in the Bangladesh-China, Nepal-China and Sri Lanka-China relations? What could be the possible opportunities and concerns when the Indian neighbourhood takes the new road with China? How do they intend to take the initiative forward?

Sino-centric bilateralism

 China’s tie with Bangladesh has been primarily one of friendly trade and defence cooperation. The International Trade Centre marks the commerce between the two States to be USD 12 billion in 2014 and estimated to exceed USD 30 billion by 2021. However, there seems to be a huge imbalance in trade, in terms of export-import between the two nations. The exports of Dhaka to Beijing seem to have not reached even a billion while on the flip side it enjoys duty free accessibility on a number of Chinese products. Bangladesh intends that the existing and growing imbalance could be tackled if China shows more interest to invest in Dhaka’s sunset industries and improve exports by sending the goods produced to Beijing.

Interestingly, Nepal faces a similar trade-deficit like Bangladesh, that is, the average export has remained at a very low rate compared to its imports with China, though, and trade relations among the duo have been at a steady rise. Nepal has not been able to fight the trade imbalance given the zero tariff entry it enjoys on a number of its goods primarily agro-products. Apart from this, geographical factors leading to poor connectivity have also been a major challenge to improve trade relations with Beijing. Nevertheless, China has been consistently making efforts to improve infrastructure on its part along the Nepal border. It has already connected a suburban plateau in Nepal through railroads.

Sri Lanka, on the other hand, has been receiving greater attention from China in recent times as the latter has been seeking to revive its ancient trade routes. This has improved the investment of Chinese Yuan in Sri Lanka. Even so, Colombo’s trade imbalance seems to be in line with other nations. The import from China accounted to USD 3,731.64 million while the imports barely remained at USD 293.05 million during 2015. Sri Lanka does not completely apprehend on this as Chinese imports of raw materials largely provide the foundation for Sri Lanka’s textile manufacturing and its export.

OBOR: Opportunities and Concerns

 The One Belt One Road (OBOR) initiative is largely seen as a gateway to expanded commerce by South Asian States. Small economics like Bangladesh and Nepal view OBOR as a prospective tool to improve the present infrastructural deficiencies which is vital for socioeconomic advancement. Dhaka, for instance, intends to meet its annual task of employment generation through the OBOR, which assures speedy growth and an extensive network of trade. Bangladesh also seeks to make use of her geographic position and work towards emerging as a major hub serving all the corridors along the OBOR. However, Dhaka seems concerned about how well it would be able to harness the opportunities to the fullest and reap benefits.

The unofficial border blockade by India has been a major factor which pushed Nepal into having extended ties with China and further into signing the OBOR. Kathmandu seems affirmative towards the initiative and like Bangladesh, Nepal also primarily views connectivity as one of the major breakthroughs to accelerate the economic engine. Kathmandu is a very recent entrant into business with China. It, therefore, becomes important for Nepal to keep a tab on the long term benefits it could gain from the initiative and also analyse on how the rest of  South Asia, especially smaller economies have been carrying their relationship with China forward.

Besides the geopolitical question, Sri Lanka, unlike the rest of her South Asian counterparts seems to remain in bigger dilemmas. The State is sceptical about its way forward due to the debt-laden projects with China it inherited from the previous government. Further, Colombo’s association with Beijing on the OBOR would mostly be on building infrastructure at the Hambantota Port and the Colombo Port for which Sri Lanka would have to respond to the queries of India on alleged Chinese expansion unto the Indian Ocean Region (IOR). But, the island already seems ready to tackle the risk.  Sri Lanka cannot underplay its ties with China, particularly at a time when it plans to move ahead with its projects.


Evidently, China’s motive might not be one of overt power projection along South Asia but covertly, it could also be in order to expand its defence capabilities by familiarising with the region in the first hand. India as a regional power seems to be drifting away from its neighbourhood. Recent policy shifts suggest that India might join hands with USA and Japan on infrastructure projects countering the OBOR. India as a major player in the Asia-Pacific region and China almost leading the superpower race today aggravates the challenges to which States like Bangladesh, Nepal and Sri Lanka could be exposed in the coming years. But, the prospects of a landmark initiative like the OBOR are undoubtedly humongous. It would not be wise of these States to let go of the enormous connectivity and trade opportunities the initiative pledges to offer. Nonetheless, small economies have to make sure that this win-win drive towards globalisation lets them extract optimally without pushing them to the Chinese laden debt-traps.

About the Author

Seetha Lakshmi Dinesh, Research Intern at ISSSP, NIAS.


Nepal 2017: Where to from here?

Nepal 2017: Where to from here?

NIAS Strategic Forecast No. 18 | Author: Sohan Prasad Sha & Suman Mondal| April 2017

To read the complete report click here

To cite: Sohan Prasad Sha and Suman Mondal. “Nepal 2017: Where to from here?,” NIAS Strategic Forecast No. 18. Bangalore: International Strategic and Security Studies Programme, National Institute of Advanced Studies, April 2017.

The perpetual state of political instability and transition now rest upon the politics of ‘amendments’ in the constitution. Major contentious issues are: the demarcation of federal boundaries, delineation of electoral constituencies in upper house and local bodies on the basis of population, recognition of local languages and provisions of citizenship.

But, the roots of constitutional discords not only at the behest of amendments per se but also the asymmetric numerical balance in the Nepalese constituent assembly turn parliament.

India’s Relations with its Near-Abroad

Asia Center, IAS Officers’ Association, Bangalore, August 20, 2016

M. Mayilvaganan, Assistant Professor, National Institute of Advanced Studies

m-mayilvagananAbstract of Lecture: India’s security and well-being are interlinked with its immediate neighbourhood. However, India’s relations with its neighbours have never been entirely free of problems. This was perhaps inevitable as there are huge differences in every aspect – geographic, political, economic and military- between India and its neighbours with which it shares its borders.

New Delhi aspires to a major role in the world, however, for about four decades after independence had been focused on the major powers, while unresolved issues with its neighbours festered. Particularly, Kashmir issue kept New Delhi much on fire fighting – dealing – with Pakistan in the region, the US internationally, and domestically Kashmir and, in between tackling China (1962). Besides, this forced New Delhi to maintain undemanding relations with its immediate neighbours, even when some incidents affected its strategic interest. The US and later China have stepped into the breach, and has made energetic strides in economic cooperation and military relations with neighbours which India has been unable or unwilling to satisfy their aspirations. Nevertheless, India’s more energetic efforts to shape its environment occasionally too have been met with accusations of hegemonism. 

The talk focused mainly on Nepal, Bangladesh and Sri Lanka as a case study. First reviewed briefly the history of India’s relations with these neighbours, identified shortcomings in policy, if any, and particularly, looked into the manner in which the BJP-led NDA coalition government and later UPA government has conducted foreign policy with its neighbours with reference to Nepal, Bangladesh and Sri Lanka from 1998 to 2014. Finally, reviewed recent developments under the current NDA government and discussed the way ahead for improving relations with neighbour. And, in doing so, the aim was to examine whether there is much change in India’s approach today than earlier.

Nepal: Return of the Madhesi Movement

ISSSP Reflections No. 45, June 08, 2016

Author: Nazrin Huzzain

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The second round of agitations has started in Nepal. There seems to be a new game plan from the Sanghiya Gathbandhan or Federal Alliance  and getting back into the agitation mode? How is the government likely to react?

 The Madhesi Agitati240920150511442-600x0on: New found support

The Janajati and Madhesis have joined forces and formed a Federal Alliance known as the Sanghiya Gathabandhan to protest together in Kathamndu.  The Madhesis seem to be striving forthe recognition of all the marginalised ethnic groups in Nepal.

The new coalition seems to be getting support, as they are seen fighting for a just cause. A federal state is not just the demand of the Madhesis, but the majority in Nepal. The constitution demands dividing Nepal into seven federal units. There is no basis on which this division has been made. If this proposal moves forward then people belonging to the same ethnic group will be split into different units.  This is something which is opposed by all the ethnic groups.

The Madhesis have been successful in mobilising the support of other ethnic groups.   This is not because the ethnic groups in Nepal are sympathising with the Madhesis, but the demands of the latter resonate with their own. Unlike the blockade earlier, the new agitations that have started in May 2016 are not the demands of the Madhesis alone; it is a call for recognition by all the marginalised ethnic groups in Nepal. Is the government listening?

Protesting in Kathmandu: A foolproof plan

The decision to move the protests to Kathmandu have been a stroke of genius. It has produced the outcome that the Madhesis had wanted – mobilise support and increase momentum for the movement. Now that the Madhesis are not alone in their cause, utmost caution is required moving forward. They should stick to their demands and not let the success to undermine their larger goal. There have been recent reports that the majority of the Morcha allies have threatened to withdraw from the alliance because, some leaders are seen as using it for their political interests disregarding the concerns of the Morcha allies. Divisions within the alliance will have a larger impact on the movement and result in its failure. This could gravely affect the momentum that the movement has picked up during May 2016.

The Gathabandhan should also be careful and ensure that the protests do not turn violent. Also, the movement should work towards avoiding another blockade. A blockade would increase the problem of black marketing that is right now on the rise in Nepal.  Prolonged violent protests and blockades would seriously affect the support that the Madhesis have gained. Recommencing dialogue with the government would be a good idea at this juncture, when the movement is enjoying such popular support.

The government’s response

Deputy Prime Minister and Foreign Minister Kamal Thapa announced during February-March 2016 that the government would be conducting local elections soon.  This is the second time this year that such an announcement has been made. Conducting elections without resolving the constitutional issues could have serious implications. If elections are held, demarcating the territory will prove difficult. This decision has been criticised heavily by the Madhesi parties. The government is trying to distract the people with false promises instead of dealing with the major issue at hand- the Madhesi movement. 

The movement is clearly on the rise, the government cannot afford to remain silent any longer.  Prime Minister Oli should stop blaming India and concentrate on resolving domestic issues. Talks have been held between the government and the Morcha, 36 times before, yielding no result. The government should start taking the talks seriously. Dialogue is the only way that the issue can be resolved. If the Gathbandhan refuses to even attend these talks owing to the insincerity of the government, the problem could take a grave turn. If the protestors turn violent, the issue could get out of hand.  Another blockade could prove fatal to Nepal’s economy, which is licking its wounds after a massive earthquake and a blockade imposed by the Madhesis earlier.

If the government fails to address the demand of the Federal Alliance now, their demands would only get stronger. The alliance is planning to move the protests to Birjung and Pokhara later. This could lead to more ethnic groups joining forces with the Gathbandhan. The government would be at a complete loss if the Madhesis along with the other ethnic groups in Terai start demanding for a separate state. The Tarai being referred as the granary of Nepal, can cause seious repercussions, if the region starts contemplating on those terms. Such a process will neither help Nepal nor its minorities within. Nor will it help the region, especially India and India-Nepal relations. The government should get more serious about this issue.

About the Author

Ms. Nazrin Huzzain is is pursuing M.A. in International Studies at Stella Maris College, Chennai. Views are personal.

The Madhesi Conundrum: Making Sense of India’s Stand  

ISSSP Reflections No. 41, May 03, 2016

Author: Sanjal Shastri

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It has been more than six months since Nepal’s new constitution was accepted; yet India has still not openly welcomed the constitution. The official Indian response has merely ‘noted’ the development. What is the reason for India’s approach? Why is the Madhesi community important for India? Did the Bihar elections have an impact? Does the RSS ideology have an impact on India’s stance? What are the implications of Prime Minister Oli’s visit? This commentary will try and address these questions.

In Sri Lanka, Maldives and in Nepal, historically, India has been supporting democratic and inclusive forces. In Sri Lanka, India has been a vocal supporter of devolution of power and the 13th amendment. India’s Operation Cactus helped save President Gayoom’s government from a military coup in the Maldives. Similarly in Nepal, the Indian government in the past has sided with the Nepali Congress. During the time of the monarchy, the Nepali Congress was seen as the frontrunner for democracy and greater inclusiveness. Given India’s history of supporting greater inclusiveness and democracy in the region, how does the latest stance on the new constitution fit in? The current Indian stance can be viewed as a continuation of its policy to support democracy and inclusiveness across the region. While the populations in the hills welcomed the constitution the Madhesis in the Terai launched an agitation claiming the constitution had ignored their demands. The challenge for the Indian government arose because of Madhesi dissatisfaction with the constitution. Over the past decade, Nepal has been in the process of rebuilding. By dismantling the monarchy, a new secular democratic republic is being setup. This therefore, is the ideal opportunity to bring on board groups that were historically marginalized.

While commitment to democracy and inclusiveness is one thing, the Madhesi question has another crucial dimension. Given the open border India shares with Nepal, a long-term solution to the Madhesi question is in India’s best interest. In case the Madhesis remain unhappy with the constitution there is always the risk of them launching a violent movement. Violence across the border in the Terai would be the last thing India wants. Having an open border and people in Bihar having close cultural ties with the Madhesis, a violent movement in the Terai would be a major security concern. The constitution as it stood in September 2015, did not satisfy the Madhesis, throwing open the long-term consequences of this opposition.

The Bihar Elections and the China factor have often been cited as reasons why the Indian government has backed the Madhesis. Were they actually decisive factors in India’s support for the Madhesis? When the new constitution was accepted in September 2015, the belief was that Indian opposition to the constitution was a part of the BJP’s election campaign.  Since the Madhesis have strong cultural links across the border, Madhesi issue would be an emotive one. The election results clearly proved that this was a false belief. Despite supporting the Madhesis, the BJP failed to do well in the elections. Even in the months following the elections the Indian government has stuck to its stance of ‘taking note’ of the constitution. It is unlikely the Bihar elections played a role in the government’s stance.

With 31% of Nepal’s population Madhesis, by ensuring proportional representation, the Indian government would have had a major bargaining block in the parliament vis-à-vis China. This has been one of the points raised by anti-India factions in Nepal. While, there is no denying that the Himalayan nation is of great strategic importance, it is unlikely that the Indian government would see the Madhesis as a counter-weight to China. There is truth in the fact that the elite circles in Nepali politics are increasingly looking towards China, but thanks to cultural, geographical and economic factors, India will continue to be in important factor in Nepal. Culturally, a vast majority of Nepal’s population identifies with India. Indian music, food and even cricket will ensure that India’s power status will be maintained in the future. For a Nepali, it is far easier to maintain people-people contact with India than China. Thanks to the open border with India, it is very easy for a Nepali citizen to visit India. However, they cannot visit China with similar ease. Economically, almost all of Nepal’s fuel, medicine and essential supplies come through India. Geographically, the southern border with India is more conducive to transport goods. Infrastructure facilities and the terrain would mean that China will never be able to replace India as Nepal’s primary economic partner. India therefore, need not be too alarmed about China increasing its presence. While popular media would like to project China’s role in India’s stance, in reality it is unlikely to have had much impact.

Indian support for the Madhesis is a part of its larger policy of supporting democratic and inclusive elements in the region. Apart from this, the possibility of a violent conflict breaking out that has pushed India to take this stand. One final question remains about the role of the RSS ideology. During the initial stages of the blockade, there were reports that Modi and the RSS were unhappy with the word ‘secular’ being included in the constitution. The RSS was reportedly keen on Nepal being called a Hindu state. Going by the foreign policy moves that Modi has initiated, it is difficult to see how the RSS ideology would have influenced his stand. Foreign policy moves like inviting the SAARC leaders including the Pakistani president or visiting Lahore would have been opposed by the RSS ideology. When Modi has taken such a stand on a far more emotive issue like Pakistan, it is hard to see how the RSS would have influenced him over this issue.

Despite a lot of hope being pinned on Prime Minister Oli’s visit to India, the fact of the matter is that nothing concrete has come out of the visit. Traditionally when the Prime Ministers of Nepal have met, they have issued a joint statement at the end of their meeting. This time around there was no joint statement issued. This is a telling fact regarding the success of the meeting. While Nepal has gone on to make several amendments to the constitution, there still remains some disagreement between the two countries. With the blockade being lifted there is hope that this disagreement will be settled sometime soon.

Looking back at what has transpired over the last six months, could India have handled this issue better? It is understandable that there are security concerns surrounding violence in the Terai, but there could have been a better way to deal with the situation. For all the issues the Madhesis have raised, this constitution was the first document that does some justice to Nepal’s pluralistic society. A statement from the Ministry of External Affairs welcoming the developments would have been the right way to go. This would not have jeopardized India’s support for the Madhesi demands. The six-month border blockade and the anti-India protests have done some damage to India-Nepal ties. However with the protests being called off last month both countries seem to be on the road to normalizing relations. Even at this late stage, a statement from the Ministry of External Affairs welcoming the constitution will go a long way in rebuilding trust.

About the Author

Mr. Sanjal Shastri is Research Intern at the International Strategic and Security Studies Programme, National Institute of Advanced Studies, Bangalore. He can be reached at <sshastri93[at]gmail[dot]com>

Nepal: Why are the Madhesis not willing to compromise?

ISSSP Reflections No. 36, February 18, 2016

Author: Sanjal Shastri 
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Rameshwor Raya Yadav, a Madhesi leader, responded to the recent Constitutional Amendment Bill endorsed by the Parliament as “positive to some extent” but still “it does not address the demands made by the agitating Madhesi parties in their entirety.” By terming the two amendments as incomplete, the Madhesis are closing the door on any possible compromise. Why are the Madhesi groups not willing to compromise on any of their demands? Aren’t bargaining and compromising not the key processes in any negotiation? What forms the basis of the Madhesi stand?

The commentary looks into the uncompromising stand as a product of historical, geographic and geo political factors, which have greatly enhanced the bargaining power of Madhesi groups.

Source: AP Photo/Ram Sarraf

Being an ethnic minority the Madhesis have always been a marginalized group. The Terai region of Nepal has some of the highest poverty density figures in the country. Due to legal reasons, a large section of the Madhesi population does not have a Nepali citizenship. Forming nearly 40% of the population, Madhesi representation in the Nepali civil service is very low. Taking into account the historical factors, the Madhesis see this as a perfect opportunity to ensure their representation in the political structure. Seeing a golden opportunity, the Madhesis would want to ensure that the new constitution protects them from any form of discrimination that can come up in the future.

Geographical division of proposed provinces forms another crucial aspect of the Madhesi stand. The current provincial structure would mean that the Madhesi population is scattered across seven provinces where they would be reduced to a small minority. This would make it very difficult for Madhesi members to get elected into the parliament. They are demanding a revision to the provincial division structure, which would enable them to send more representatives to the parliament. Judging from the reaction to the constitutional amendments, this point seems to be something that none of the Madhesi groups are willing to compromise on. By agreeing to the current provincial division plan, demographic structures would ensure that fewer Madhesis get elected to the national parliament. Ethnic based provincial divisions would mean that the various ethnic groups would find their place in the political process.

India factor seems to be the third factor behind the Madhesi stance. Though India has denied any role in the agitation, Madhesi leaders recently travelled to Bihar to meet Nitish Kumar and Lalu Prasad Yadav. The official Indian response to the amendments addressed it as a ‘positive development’ but added, “We hope that other outstanding issues are similarly addressed in a constructive spirit”. The Indian government does have significant control over the Madhesi leaders. India’s indirect support for the movement gives the crucial confidence for the Madhesi agitators to block the vital supply routes, which is causing a severe fuel shortage across the country. The agitators have understood Nepal’s dependence on this land route and the importance of India as a trading partner. Using their connections to India and Nepali government’s economic dependence on it, the Madhesi agitators have significantly enhanced their bargaining power in the parliament.  

Historical and geographical factors have pushed the Madhesis to demand for greater concessions. The support they receive from India greatly amplifies their bargaining power. Having had a history of discrimination, the constitution provides the Madhesis with a great opportunity to ensure their integration into the political mainstream. This is an opportunity that the Madhesis are not willing to miss out on. At the heart of their demands is the reorganization of the provinces. The proposed division of provinces means it would be difficult for the Madhesis to secure greater political representation.  By not addressing this issue, the constitutional amendments failed to break the deadlock.

The constitutional amendments are definitely a positive sign and a step in the right direction. Given the political, historical and geographical factors, more compromises will have to be made if the deadlock has to be broken. The growing shortage of fuel and essential supplies means that there is an increased urgency to put an end to the blockade. From the constitutional amendments to the growing urgency to end the blockade the signs are that a solution would be found soon.

About the Author

Mr. Sanjal Shastri is Research Intern at the International Strategic and Security Studies Programme, National Institute of Advanced Studies, Bangalore. He can be reached at <sshastri93[at]gmail[dot]com>


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