China, India and Nepal: Intrigue on Top of the World

Nestling in a valley on top of the world, wedged between two emerging global powers, the small and seemingly neutral former Hindu kingdom of Nepal has not always figured on the antenna of international intelligence agencies. In recent months however, a strategic impasse resulting from a political logjam between Maoists and rival parties, has created a situation where the young republic has become a playground for competing intelligence agencies vying for a foothold in the politics of the fledgling democracy. Sharpened by India’s political rivalry with neighbouring China and Pakistan, and of critical importance to Washington in its complex relationship with Beijing, Nepal has suddenly acquired what some describe as a permissive security environment.

The World Today Published 1 June 2010 Updated 11 March 2020 3 minute READ

Charu Lata Hogg

Associate Fellow, Asia-Pacific Programme

Nepal’s strategic importance stems from the fact that it virtually forms a buffer between rivals India and China. Although traditionally, Nepal has been under New Delhi’s shadow – all its fuel, most of its military equipment and almost all cultural influence comes from India – this is slowly shifting in favour of China.

India and China’s goals in Nepal are shared. Both fear destabilisation from Nepal and feel the need to influence it. Both want Nepal’s political situation to stabilise and are worried about security.

India’s concerns stem from the fact that any agitation on the Nepalese side of their shared border inevitably spills over to India and the possibility that Pakistan-trained militants could move through Nepal.

China sees Nepal as crucial to the security of Tibet as Nepal has traditionally been a crossing point for Tibetan refugees. It seeks support from the Nepali government in controlling the twenty thousand Tibetan exiles based there, who often protest against Chinese policies in their homeland.

Treaty too far

Chinese influence remains near the top of Delhi’s concerns over Nepal. An unprecedented 38 Chinese delegations have visited Nepal since last year, so India took a dim view of the proposed return visit to China by Maoist chief and former Prime Minister Prachanda to sign a treaty that mimics the 1950 Treaty of Friendship between Nepal and India, a document unique to the relationship between the two countries.

India’s concern reflects a genuine fear that any international presence in Nepal will inevitably reduce its almost vice-like grip on the country. This would seriously challenge its position in the neighbourhood and restrict its scope for intervention.

Even though India upholds the ‘One China’ principle on Tibet, and pledges to prevent the Dalai Lama and his followers from engaging in ‘anti-China political activities in India’, simmering Tibetan unrest could upset its bigger neighbour.

India is said to use its operatives to gather information on the activities of the United Nations and the Chinese, Pakistani and American presence in Nepal. Under a 2006 deal that ended a decade-long civil war between the government and the Maoists, the United Nations Mission to Nepal (UNMIN) supervised the former combatants’ compliance with an agreement on their arms and armies.

India is charged with stoking the controversy over alleged UNMIN humanitarian contacts with Madhesi armed groups in its own state of Bihar even while ironically, it is said to have directly supported the same insurgents.

Despite agreeing to the presence of a UN human rights monitoring body in Nepal, India is categorical that it does not want extended UN Security Council attention in its backyard given its sensitivities on Kashmir.

India has also vociferously denied UNMIN the opportunity to do much more towards the process of army integration than house the Maoist People’s Liberation Army (PLA) in cantonments, and store its weapons.

The Tera plains of southeast Nepal bordering India are said to be the focus of India’s greatest covert involvement. The political complexity in this region and profusion of small, violent groups have continued to increase, primarily posing a challenge to the Maoists and other centrist parties.

India is charged with funding the establishment of the Terai Madhes Loktantrik Party (TMLP) and the Madhesi Janadikhar Forum (MJF, generally called the Forum).

The Indian media has also alleged that Pakistani intelligence agents are using the porous border to transfer counterfeit Indian currency from Nepal to India.

Tibet test

If it once regarded Nepal with sporadic interest, China is now making its influence more keenly felt, partly because of its overriding concern that Nepal could become an epicentre of Tibetan agitation, particularly in a post-Dalai Lama era, and partly as another area where its traditional rivalry with India could play out.

Beijing sees Nepal’s Tibet policy as a litmus test of their friendship. China insists that the potential for instability in Tibet stems more from the internationalisation of the Free Tibet campaign than from any perceived or real deficiencies in its policies. Chinese officials have been candid in partly attributing the scale of the 2008 protests in Nepal to international involvement in Nepal’s peace process.

Nepali governments of all political hues have had little choice but to kowtow to their powerful neighbour’s primary demand.

Earlier this year, Chinese state media reported that the two countries had agreed to cooperate on border security, while Nepal repeated its commitment to prevent any ‘anti-China’ events on its territory.

While details of the deal have not yet emerged, it is rumoured that the two countries are to finalise a programme under which China would provide money, training and logistical support to help Nepal expand

police checkpoints in isolated northern border regions. Tibetan campaigners say tightened border security and closer ties have already sharply slowed movement. Until 2008, roughly two-and-a-half to three thousand Tibetans slipped across the border annually, but by last year the number dropped to about six hundred.

Stability at stake

This tiny, exotic nation has become yet another theatre of rivalry between India and China just when its own political stability is at stake. Nepal should have laid a solid foundation for peace by restructuring the state and writing a new constitution by the May 28 deadline. But progress has been halting since a special assembly was elected in April 2008 and the Maoists left government in a dispute over firing the country’s Army chief. They have since paralysed the administration with strikes and blockades.

The Maoist vote is indispensable to pass a new constitution, which needs a two-thirds majority. And without Maoist cooperation, the future of some nineteen tthousand fighters corralled in UN-monitored camps cannot be settled.

For now, the main non-Maoist parties have a strong incentive to delay constitution- writing as its completion will bring fresh elections for which they are not prepared. Despite their waning popularity in Nepal and beyond, the Maoists remain the largest single dominant force and the older parties are vulnerable.

Even though the Maoists are crucial to future peace in Nepal, the international community is still wary of them. The US, while keeping clear of the political imbroglio and supporting the UN process, is undoubtedly not pleased at the prospect that the Maoists – still on the State Department’s terror list – may again become the decisive force there. It views a heavy presence in Nepal as essential to its long term policies on China and Tibet. The continuing political flux and fragile security make Nepal an ideal playing field for international actors.