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During his meetings with senior American offi­cials, including Secretary of State Mike Pompeo, Nepali Minister for Foreign Affairs Pradeep Gyawali repeatedly urged his American counterparts to stop viewing Nepal through Indian lens. The perception in Nepal that the US sees Nepal through Indian prism was strengthened during the five months of the blockade when many Nepalis felt that the Americans were not vocal enough about India’s inhumane treatment of its small neighbor. With the Americans renaming ‘Asia-Pacific’ as ‘Indo-Pacific’, in a clear preference for India over an expan­sionist China in the Indian Ocean, and given recent US-China trade frictions, it is easy for smaller South Asian countries to believe the Americans have somehow ‘exported’ their regional policy to India. Interestingly, in its defense, the Americans say they would not have as strong diplomatic and security presence in Nepal if they had outsourced their Nepal strategy to India. That is true. The American diplomatic presence in Nepal is huge (though no one knows how big). Perhaps the same is true of its security presence.

The security establishment in the US, and the CIA in particular, has always seen Nepal as an important buffer between India and China, a convenient outpost from which they can closely monitor the maneuvering of these two regional giants. (Close geographical proximity is priceless even in the age of drones.) Given Nepal’s advan­tageous geostrategic position, they would be foolish not to. That the Americans mostly prefer to remain low-key is a different matter.

But they do sometimes throw their weight around. For instance, the US Embassy put a spanner on the plan of the Poverty Alleviation Fund to develop the 14 districts abutting Tibet with Chinese money. They also promised alternative sources of funding. The relationship between the US and Nepal armies has never been stronger and the Americans in the future may not be shy about leveraging this for geopolitical gains. This in turn calls for a carefully calibrated Nepal policy.

Voters these days don’t elect leaders to protect the human rights of people halfway across the world. They vote for Trumps and Mays and Modis of the world so that their borders and their livelihoods are safe and secure. For this it is vital that countries be largely self-reliant. For one-party China, the show of sovereign strength abroad is even more important for domestic stability.

Pompeo and the Americans need no reminders. They per­haps know exactly what they are doing in Nepal.

Bhattarai for one thinks such suspicions are unwarranted. “We have this tendency in Nepal to harp on small issues and not to look at the big picture,” he says. “What is happening with BIMSTEC is only a part of the practice of greater region­al integration seen in all regions of the world.”

Some chalk up the agreement on a regional power grid as the biggest achievement of the fourth BIMSTEC summit. At least on paper Nepal will now be able to harness its hydropow­er and sell it to other BIMSTEC coun­tries. But thus far there has been no systematic study on whether such cross-border power trade between South Asia and Southeast Asia is even possible. Pretty much the same is true of connectivity via waterways, particularly for landlocked Nepal and Bhutan.

The seven BIMSTEC member states have also agreed to boost cooperation on anti-terrorism. In line with this objective, India is hosting a week-long BIMSTEC mili­tary exercise starting September 12. “Again, there is no surprise there,” says Rajan Bhattarai. “Disaster man­agement and terrorism are problems that no single country can handle on its own and since the national armies are at the frontline of post-disaster management, it is also not surprising that they seek closer cooperation.”

Asked about the military drills, Nishchalnath Pandey, the director of the Center for South Asian Studies, replies, “Of foremost importance for BIMSTEC is to have a governing char­ter without any delay. Any deviation from this task will create controversy and misunderstanding.”

Pandey says that it is hard to talk of meaningful cooperation within BIMSTEC without a char­ter. He also outlines a baseline for BIMSTEC. “At least there could be visa on arrival for BIMSTEC nationals in each other’s countries. Otherwise, why would people value the organization?”

But Bhattarai contends that BIM­STEC, and the fourth summit in particular, has already notched up significant achievements. “We were able to bring down priority areas from 14 to five, we agreed to expand and consolidate BIMSTEC Secretar­iat, we expressed our commitment to come up with a governing charter by the time of the fifth summit,” he responds. “What more can you expect from a single summit?”  

 The fourth heads-of-state summit of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) in Kathmandu on August 30 and 31 brings together seven countries, five from South Asia (Bangladesh, Bhutan, India, Nepal, and Sri Lan­ka) and two from Southeast Asia (Myanmar and Thailand). BIMSTEC, formed in 1997 in Bangkok, had been moribund for much of its existence, with the last summit held in Naypy­idaw, Myanmar in March 2014. Late­ly, however, the forum has gotten a new lease on life thanks to India’s renewed interest.

India, by far the largest country both economically and militarily in BIMSTEC, has tried to promote the forum in lieu of the South Asian Association for Regional Cooper­ation (SAARC), the eight-country grouping which includes Afghani­stan, Bhutan, Bangladesh, India, the Maldives, Nepal, Pakistan, and Sri Lanka as members. The reason for the switch is the growing realization in New Delhi that the India-Pakistan rivalry will never allow for meaning­ful regional cooperation from within the SAARC framework.

All the major decisions in SAARC have to be taken by consensus. Because India and Pakistan sel­dom accept each other’s propos­als, there has been little headway made in terms of bringing South Asia closer economically. India refused to take part in the 19th SAARC summit that had been scheduled for Islam­abad in 2016, saying that there would be no engagement with Pakistan unless the latter stopped providing safe haven to terrorists. India now seems intent on pushing regional initiatives like BIMSTEC that do not include Pakistan.

But while Pakistan could arguably have done more to rein in anti-India terrorism that originates on its soil, India’s overall role within SAARC has also been dubious. When SAARC was founded under the initiative of Ban­gladesh and Nepal, India suspected smaller countries in the region were trying to “gang up” against New Del­hi. Hence, India has never been keen on SAARC. Perennial India-Pakistan tensions only made the situation worse.

Yet there continues to be con­siderable goodwill for SAARC in its smaller member states like Nepal. Traditionally, Nepal has seen SAARC as a forum where it could stand as an equal with India, the “big brother” next door. There is also a feeling that India, the undisputed fulcrum of South Asia, could have done more to promote regional cooperation in South Asia (despite Pakistan’s less-than-helpful attitude). This is why many analysts in Kathmandu are suspicious of India’s intent behind its backing of BIMSTEC.

Most don’t expect anything sub­stantial to come out of the fourth BIMSTEC summit Nepal is hosting. After all, BIMSTEC has not managed to draft a guiding charter in over two decades of existence. Interestingly, the Nepal government has already started chalking up successes on the bilateral front with India, like rail and road connectivity projects, as prospective BIMSTEC success stories. This means Nepal will allow India to place many of these bilateral projects under BIMSTEC, just like it has allowed China to club most of its bilateral projects with Nepal under the Belt and Road Initiative (BRI).

The China factor is vital. During the last SAARC summit in Kathman­du in 2014, Nepal, with Pakistan’s support, had proposed that China be included as a full SAARC member state, a development that India did not appreciate. Traditionally, India has seen South Asia as its backyard and has not been ready to let in a third party. There was a perception in New Delhi that Beijing was look­ing to spread its footprints in South Asia via SAARC. This is another rea­son Indian Prime Minister Narendra Modi wanted to revive BIMSTEC, which, unlike SAARC, has a distinct anti-China whiff.

With this background, Nepal’s foreign policy of late has been rather curious. New Nepali Prime Minister K.P. Sharma Oli seems to believe that if he has both India and China on board he does not need the rest of the international community. So as Sino-India ties have warmed, Oli has relentlessly pushed the idea of Nepal-India-China trilateral coop­eration. Before, the Indians did not even want to hear of it. Now they are more sympathetic.

Nepal will hence look to derive maximum benefit from China’s BRI, while also not desisting from using multilateral forums like BIMSTEC to enhance ties with India. This may not be wise. India and China have never cooperated for a third coun­try’s benefit in South Asia, and it would be naïve to think they will do so for Nepal. But Oli is determined to give it a go.

Just as joining the BRI helped Oli curry the favor with the Chinese, he seems to believe that follow­ing India’s lead on BIMSTEC will help him cement ties with the Indian establishment. With both India and China on his side, he will also feel he has enough inter­national support to serve out his five-year term. (Nepali governments have often been toppled early due to India-China geopolitical tussles.)

The big question that is being asked in Kathmandu is whether India is ready to overcome its security sen­sitivities and allow Nepali trucks and trains to use its territory to directly connect with Bangladesh and Myan­mar. If not, BIMSTEC will prove to be no more than a geopolitical chess­board for bigger powers, and one which has little room for smaller players in the region like Nepal. The Diplomat

 What is the rationale behind the Bay of Bengal Initiative for Multi-Sectoral Tech­nical and Economic Cooperation (BIMSTEC)? Far from the Bay of Ben­gal, why is Nepal even a part of it? Is meaningful regional cooperation possible by undermining SAARC? If not, why is Nepal promoting it? As Kathmandu prepares to host the BIMSTEC Summit, the fourth in the 20-year history of the organization, many-many questions are being asked about BIMSTEC. There seems to be few answers. The Ministry of Foreign Affairs says climate change and poverty alleviation will be the twin focus of the Kathmandu jamboree. But then the Nepali parliament has just ratified a region­al anti-terrorism bill that entails greater security cooperation with India. There are thus more than a few observers in Nepal who think BIMSTEC is an Indian ploy to isolate Pakistan (See Editorial).

“India has always had this para­noia about other SAARC countries ganging up against it, particularly Pakistan,” says Keshav Prasad Bhat­tarai of Nepal Institute for Strategic Studies. “It is using the BIMSTEC platform to undercut SAARC”.

Bhattarai says the idea of linking South Asia with Southeast Asia, as BIMSTEC aims to do, is alluring. But is it feasible? “For instance is India willing to allow our cargo trucks unhindered land access to Bangla­desh and Myanmar? If not, it is futile to talk of BIMSTEC.”

Constantino Xavier of Brookings India, who recently authored a sem­inal paper on BIMSTEC, disagrees (Interview will be available online Sunday). He says the idea of linking South Asia and Southeast Asia is not new; the age-old trade links between them were severed only when the British colo­nized the Indian subcontinent. Also, compared to SAARC, says Xavier, “BIMSTEC is not hostage to cyclical India-Pakistan tensions.” But what is in it for Nepal? The BIMSTEC Sum­mit, he says, is a chance for Nepal to “assume greater global visibility”.

The problem right now is that Nepal is unclear about what it wants from the forum, and hence the per­ception that it is happy to follow India’s lead. Perhaps the ‘BIMSTEC charter’ that will be drafted by this summit will offer some clues. 

Full coverage on Sunday

Kan Kimura is a doyen in the fields of political science and area studies in Japan. A professor with the Graduate School of International Cooperation Studies in Kobe University, Kimura is author of over a dozen scholarly books on Japanese and Korean history and Japan-Korea relations. The foremost authority on North Korea-South Korea relations, Kimura has written extensively on Asian geopolitics as well. Biswas Baral and Shambhu Kattel of APEX caught up with Kimura during his brief personal trip to Nepal to discuss the wider ramifications of the ongoing US-North Korea dialogue, BRI and Nepal, and Japan’s place in Asia.

What are the broader security implications to Asia of the recent rapprochement between the US and North Korea and prospect of peace in the Korean peninsula?

First of all, it will not be at all easy to make North Korea renounce all its nuclear weapons. Even if the North announces that it has given up all its nukes that will be technically dif­ficult to verify, much more difficult than it was in the case of say Iraq or Libya. Moreover, you have to under­stand that the reason North Korea has nuclear weapons is because of the United States.

Now the Korean peninsula is firm­ly under Chinese influence. I think recent US diplomacy in Korea is a part of its plan to withdraw from the peninsula, as President Donald Trump keeps hinting. Even while he was campaigning for presidency, Trump made it clear that he would withdraw US troops from East Asia and he seems intent on keeping his promise. But whatever Trump says I don’t think there will be a big change in North Korean nuclear arsenal in the near future.

The prospect of the US with­drawal from East Asia is the biggest nightmare for the Japanese people. Of course the Chinese don’t think that way.

But isn’t the presence of Amer­ican troops in the Korean pen­insula also in Chinese inter­est? Because if they withdraw without the North giving up its nuclear weapons then Japan would also be forced to acquire nukes and to enhance its military capabilities. Japanese invasion of China in early 20th century has not been forgotten.

What you are saying would have made perfect sense back in the 2000s. But right now the Chinese GDP has grown twice as big as Japan’s. In the next 10-15 years, the Chinese economy could be four to five times bigger than Japan’s. Now the Chinese policymakers believe that they have absolutely nothing to fear from Japan if Japan is estranged from the United States. For histor­ical reasons, Japan does not have very good relations with countries like South Korea, the Philippines and China. So without the support of the US, it will be isolated. China seems to be succeeding in its strate­gy of ‘divide and rule’ as they have successfully driven a wedge between the US and Japan, and Japan and South Korea. South Korea is now completely dependent on China, as is the rest of South East Asia.

To change track a bit, what does Japan make of China’s Belt and Road Initiative?

What I have been telling the Jap­anese government is that Japan is still the biggest military and economy power in Asia bar Chi­na. So it can still forge meaningful partnerships with other coun­tries in the region. Take the case of the Trans Pacific Partnership, from which the US recently with­drew. Everybody thought that US withdrawal would be the death of the TPP but that is not the case. Other countries in the partnership wanted to keep it alive and you see that the US is again showing some interest in rejoining. Japan should fully support this process. If Japan does not take leadership on this no other Asian power can do so. India cannot do so because it does not have much influence beyond South Asia, not even in Myanmar, its next-door neighbor. India is getting militarily and economically strong and yet it is still by and large an iso­lated power.

There is a fear in Nepal that the Chinese are flexing their eco­nomic muscles to get their way and the BRI is part of the same coercive strategy.

Nepal’s situation is a bit like Mongolia’s, trapped between two big powers. But one of the good things for Nepal is that most of the geopolitical competition between big powers in Asia seems to be happening at the sea, the South China Sea for instance, and away from landlocked coun­tries like Nepal and Mongolia. The other good news for Nepal is that India and China seem to have for now settled their border problems and a big flare-up between them looks unlikely.

So I say you make the best of the good relations between India and China. More than that, Nepal is now maturing as a democracy, which is a big plus, because we cannot say the same about other countries in the region like Bhutan or Bangla­desh or Pakistan. This is a bulwark against the tendency of other big powers to intervene. It also allows other democratic entities like the EU and Japan to contribute to Nepal’s development. They can also then intervene when they believe Nepal’s sovereignty is at risk.

But how does Japan view the BRI? In your understanding, is it a benign concept that will benefit everyone or does it have a sinis­ter ring to it?

Frankly, the Japanese government is not too happy to see such a coa­lition but we know that we can’t also stop it. The best option then is to give each country in the BRI or TPP the freedom to join the other organization as well. So long as the BRI is not a closed entity, we should be open to the idea. This is why although those in government in Japan were initially hostile to the BRI idea, they have come to increasingly accept it as a fact of life.

What do you make of the idea of ‘debt trap’? Some in Nepal say that soon the country will owe so much to China it will have no option but to accept greater Chi­nese intervention.

Relying too much on bilater­al negotiations with China is bad for any country. The way to go about it would be to enhance your links with other countries as well, for which you need not neces­sarily be anti-China, so that you don’t give the Chinese too much bargaining power. This is why it is vital for Nepal to maintain good relations with other members of South Asia as well as entities like the ASEAN. Otherwise, Nepal can­not say no to China or to India. So have good relations with everyone. South Korea successfully punches above its weight diplomatically because it can leverage its unique relations with the US, Japan and China to its advance. Nepal should do the same.

Prime Minister KP Oli has all the right foreign policy ideas. In his two terms as the gov­ernment head, he has made bal­ancing India and China the central plank of Nepal’s post-blockade for­eign policy. In large part this is a personal calculation. Near the end of his political career, and with his health iffy, Oli is deter­mined to leave behind a strong leg­acy: of a Nepali prime minister who not only talked about ‘equidistance’ with the two neighbors, but actually did something about it. With the memory of the blockade fresh on his mind, he embarked on the historic state visit to China in 2016, where he would sign a landmark trade and transit treaty. If this treaty came to fruition, never again would India be able to blockade Nepal. This is why people expected the protocols to make the treaty functional to be signed during Oli’s second state visit to China earlier this month.

It wasn’t meant to be. The 2016 treaty is not mentioned in the 14-point joint statement issued at the end of Oli’s China trip. Some think this owes to the recent thaw in relations between PM Oli and his Indian counterpart Narendra Modi. Oli, in this reck­oning, is mak­ing a deliberate attempt to maintain a safe distance from China at India’s promoting, for instance by dilly-dallying on the treaty protocols. Or perhaps things were already out of Oli’s hands.

The Trump effect

Much like Nepal-India relations have recently warmed, so have India-China ties. After the Wuhan Summit in April between Xi Jinping and Narendra Modi, India and China seem intent on working together and mounting a common front in favor of unhindered globalization—which has brought the two countries rich rewards—against a protectionist US. Both Modi and Xi Jinping realize that it is unwise to rely too much on the ever-unpredictable Donald Trump. Some go so far as to argue that India and China have recently even settled their respective spheres of influence in South Asia.

“Such a possibility cannot be ruled out,” says Bhaskar Koirala, the Director of Nepal Institute of International and Strategic Studies. “Why was Nepal excluded from the recent Boao and SCO summits in China? Perhaps this was part of the new Chinese strategy of accommo­dating Indian concerns.”

Nowhere is this change in Indian perception of China more evident than in the Indian media, which in earlier times used to play up the specter of Nepal being gobbled up by China at the slight­est hint of Nepal-China rapprochement. But goaded by the South Block to tone down their anti-China pos­turing, the Indian media were this time largely silent on Oli’s China vis­it; some even wel­comed it.

“Sandwiched between two big countries, it is natu­ral that Nepal should seek to maximize its geography to its own advantage,” wrote The Indian Express in its June 25 editorial. “To that end, it has a tough balancing act to do, and India—no strang­er to tightrope walks itself—should be able to appre­ciate that”. This is an incredible turnaround from their strident blockade-time anti-Oli hysteria.

Border patrol

Other factors too could have delayed the trade and transit pro­tocols. The 14-point joint statement offers some clues, point number 10 in particularly. It says the two sides have agreed to strengthen “coopera­tion between law enforcement agen­cies” and to “negotiate the Treaty on Mutual Legal Assistance in Criminal Matters and Treaty on Extradition”. This is considered vital in order to “strengthen cooperation on the administration of border areas and fight against illegal border crossing and transnational crimes”.

China is clearly worried about opening the sen­sitive region of Tibet without Nepal first giv­ing clear assurance that absolutely no anti-China activities will be permitted in border areas. Hence the emphasis on the extradition of potential Tibetan infiltrators into Nepal. This also suggests that China is not assured that Nepal, at present, can offer such guarantees. But in the view of security analyst Geja Sharma Wagle, as the level of engagement between Nepal and China increas­es, “it is only natural that China is more worried about the security implications of deepened ties.”

The other major agreement signed during Oli’s China visit earlier this month concerns a rail link. Both President Xi and Prime Minister Oli described the MOU on rail connectivity as the “biggest achieve­ment in bilateral history.” Chinese foreign ministry spokesperson Geng Shuang later informed that in the first phase the Shi­gatze-Key­rung line (that is to be completed by 2020) will be extended to Nepal’s Rasuwagadhi and in the second phase to Kath­mandu. Significantly, the ear­lier proposal of Nepal that the line be extended up to Lumbini on the Indo-Nepal border has been dropped. (The whole project is expected to take around six years.)

But opinion continues to be divid­ed on the rail project. As Raamesh Koirala pointed out in Naya Patrika, a high-speed rail may not be a good idea considering the difficult topog­raphy of border areas and that it is much cheaper to build all-weather roads instead. Things should be clearer in August when a Chinese team completes its feasibility study on the cross-border railway.

Whither Lipulekh?

There were other significant agreements in China this time, most notably on 600 MW Marsyangdi Hydro Project, as well as on set­ting up a $140-million cement factory, energy cooperation, opening of the closed Tatopani bor­der, etc. The trade and transit protocols, the government has assured, will also be signed sometime in July.

Thus while the intent of PM Oli to diversify Nepal’s rela­tions away from India, which necessarily entails closer ties with China, is prin­cipally right, he will have to get the modal­ity of connectivity projects rights. He will also have to increasingly heed China’s security concerns. Moreover, the Nepali prime minister could have a tough job of trying to pro­tect Nepali interests in light of the recently heightened engagement between India and China.

Perhaps the most notable omis­sion in the June 21 Nepal-China joint statement was the issue of Lipulekh, the tri-junction point between Nepal, India and China. In 2015 India and China had agreed to increase trade connectivity through this border point without consulting Nepal. As the editorial in the Indian newspaper hinted, it will indeed be a tough balancing act for Oli in the next few years O

Even as the ‘democratic credentials’ of his government is increasingly being questioned, Prime Minister KP Sharma Oli still gets the benefit of doubt when it comes to his foreign policy conduct. In both his terms as prime minister, he has made a concerted effort to balance India and China, in the realization that only by increasing Nepal’s trade and connectivity with China can the country stop being over-reliant on India. And only then will Nepal be able to once and for all forestall India’s blockade-like pressure tactics.

Near the end of his political career, he also seems determined to leave behind a potent legacy: of the national leader who actually did something to maintain ‘equidistance’ between India and China—rather than only pay lip-service to the concept like his predecessors. But there is a wee problem. Even as PM Oli wants to enhance every kind of cooperation with China, the northern neighbor seems guarded. Perhaps it wants to first ensure that deepened ties with Nepal will not impinge on its security concerns over Tibet. Perhaps the recent thaw in India-China relations—with some even speculating that the two countries have settled their respective spheres of influence in South Asia—have something to do with it. 

“Such a possibility cannot be ruled out,” says Bhaskar Koirala, the Director of Nepal Institute of International and Strategic Studies. The changing regional dynamics could thus add to Nepal’s foreign policy challenges. PM Oli has thus far shown a remarkable ability to keep both India and China in good humor. He will have to be even more skillful in the days ahead.

Full story HERE....