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Nepal is set to elect its new President on March 9. This gives major political parties more than a month to nominate their candidates. But there is a rub: the ruling CPN (Maoist Center) and its primary coalition partner, CPN-UML, seem to be headed toward a conflict regarding presidential pick, and it isn’t helping that Nepali Congress is also claiming the post. If Prime Minister Pushpa Kamal Dahal were to honor the gentleman’s agreement reached with UML leader KP Sharma Oli, the UML candidate is sure to win the presidential race. As part of a power-sharing deal, Dahal had promised to cede the prime minister’s office to Oli after 2.5 years and back UML candidates for the speaker and president’s posts. UML’s Dev Raj Ghimire was elected the Speaker as part of the understanding between Dahal and Oli on January 19. Prime Minister Dahal, however, is unlikely to back UML’s presidential candidate. Doing so would mean that UML would be heading the House of Representatives, the Office of the President, and after 2.5 years the executive—a terrifying prospect for both Maoist and NC. Dahal has been using the phrase ‘national consensus’ these days when talking about the next president. That’s his euphemistic way of saying that Oli should not have the power to dictate who the president should be. Dahal’s Maoist party has also officially decided to forge a consensus on the presidential election. But there are some leaders in the party who fear that deviating from the agreement with UML could damage the party and Dahal’s image. The position taken by Maoist has fueled mistrust between Oli and Dahal. Some UML leaders already suspect that Dahal could break the current coalition and forge a new one with the NC, which has the most number of seats in parliament. Narayan Dahal, standing committee member of the Maoist party, says this is something that the situation has demanded due to the lack of a clear majority in parliament and an inability of any party to form a stable coalition. It is urgent to elect the president based on national consensus, he adds, noting that if the UML gets the presidency, there will be no one to counter its power in parliament. UML leader Astalaxmi Shakya, however, is of the view that the Maoists should not renege on the power-sharing agreement. She says Dahal should be serious about the consensus, because he got the premiership, which is already a huge achievement for a third-placed party. Dahal apparently has gained the courage and confidence to spurn Oli partly because the NC had given him the confidence vote on January 10. It is clear that NC, which was relegated to the opposition benches despite winning the most number of seats in parliament, wants to break the Maoist-UML coalition and be in the governing position. The NC gave its trust vote to Dahal so that it could bargain for the posts of speaker and president. Having lost the speaker’s seat, the NC is now trying to secure the presidency. If Dahal agrees to throw his weight behind NC’s candidate, it could spell an end for Maoist-UML coalition. And if this scenario comes to pass, it would be a masterstroke on the part of NC leader Sher Bahadur Deuba, who is currently under fire for breaking up the electoral alliance with the Maoists. Despite the risk of imminent rift with the Maoist party, UML’s Oli has rather uncharacteristically kept restraint. He and Dahal have been meeting almost on a regular basis. Keeping the current coalition intact is important for UML. When Oli agreed to back Dahal’s prime ministerial bid, he did so because his party had the upper hand numberwise. Even though the Maoist, third-placed party in parliament, led the government, the UML was in the position to call the shots as the kingmaker. But the situation changed after NC gave its vote of confidence to Dahal. If the UML were to ditch the coalition, Dahal is confident that he will have NC to back him. In such a situation, UML will be out of power both at the center as well as in provinces. Oli knows this very well. If he wants to safeguard the coalition, he better not create a stink about not getting the presidency. At any rate, Dahal is unlikely to hand over the presidency to the UML—that is unless Oli agrees to sacrifice the promised premiership after 2.5 years. Dahal could even be fancying a chance of becoming a full term prime minister if the NC were to join the ruling coalition.

US Undersecretary of State for Political Affairs Victoria Nuland on Monday laid out the key issues that America wants to work on with the Pushpa Kamal Dahal-led government. The top State Department official arrived in Kathmandu on Sunday evening as part of her trip to Nepal, India, Sri Lanka, and Qatar. On Monday, she held separate meetings with Prime Minister Dahal, Foreign Minister Bimala Rai Poudyal, CPN-UML Chairman KP Sharma Oli, and Nepali Congress President Sher Bahadur Deuba. The meetings revolved around the topics of US-Nepal bilateral partnership, Nepal’s transitional justice process, and transparency, among others. Speaking to the media later in the day, Nuland said the US wants to enhance long-standing partnership to support Nepal’s economic development. “The US wants to see Nepal as a strong economic power, I am excited to go home and discuss in Washington what happened here in Nepal,” she added. In her meeting with Prime Minister Dahal, the first agenda under discussion was a smooth implementation of projects under the US’ Millennium Challenge Corporation (MCC) Compact: construction of transmission line and road upgradation. “We, of course, discussed the next step in finalizing the MCC projects,” said Nuland. Nepal’s parliament endorsed the MCC Nepal Compact in February last year amid protests from some fringe parties on the left. The projects are due to enter their execution phase in August, and the US wants assurance from the Dahal government that they are implemented without obstructions. Despite parliamentary ratification of the compact, some elements are still trying to obstruct its progress. There have been reports about protests in areas where the transmission line under the MCC is to be constructed. Another issue that figured in the meeting between the US official and top Nepali leaders was the long-drawn-out transitional justice process. According to Nuland, they discussed the transitional justice bill, which is under deliberation. The US and other Western powers are of the view that the transitional justice process should be victim-centric. They are against the idea of granting blanket amnesty on cases of serious human rights violations. “The US is ready to provide support to implement the TRC (Truth and Reconciliation Commission) laws,” said Nuland. The US official also took up the issue of investment climate in Nepal. She told senior government and political party leaders that US investors are eager to invest in Nepal, provided there is a conducive environment. Corruption in Nepal remains a key concern for the US when it comes to building a trustworthy investment climate. The Joe Biden administration has come up with the first-ever United States Strategy on Countering Corruption aimed at elevating the fight against corruption, not only at home but also abroad. Foreign visits of top Biden officials are also aimed at enhancing US partnership on global issues, such as the ongoing Russia-Ukraine war, the state of democracy, and the threat of cyber attacks. Nuland said she and Nepali leaders discussed ways to enhance partnership to foster democracy in Nepal. She said the US was ready to provide technical support to Nepal in the field of cybersecurity. Asked about the growing US-China geopolitical rivalry, Nuland advised Nepal to maintain good relations with all neighbors. “We welcome Nepal having a good relationship with all its neighbors,” she said. But while forging economic partnership with neighbors, she said, making a veiled reference to China, that Nepal should pay attention “to protect its sovereignty, ensure that it is good for Nepal, there is no corruption and everything is transparent”. Nuland refrained from making any comments on China’s protest against the MCC. She said the Biden administration was engaging more with China.

Victoria Nuland, US under secretary of state for political affairs, arrived in Kathmandu on Sunday to “engage with the new government on the broad agenda of the US partnership with Nepal”. It will be the first high-level visit of a foreign official since the formation of a new government under Pushpa Kamal Dahal in December last year. According to the US State Department, the primary American objectives in Nepal are strengthening good governance, democratic values, and security and stability. Supporting inclusive, equitable economic growth; a clean, resilient energy future; and helping Nepal become more self-reliant, independent, and resilient as it confronts global challenges are other US objectives in Nepal. A senior US official says Nuland’s daylong visit will focus on all key areas of US-Nepal partnership. Nepal’s parliament ratified the US’ Millennium Challenge Corporation (MCC) Compact in February last year, and Washington clearly attaches high priority on its successful implementation. The $500m grant is aimed at expanding Nepal’s electricity transmission infrastructure and improving its road maintenance regime. The MCC projects will enter their execution phase from August. Some say the MCC is Washington’s response to Beijing’s Belt and Road Initiative. And in the run-up to the MCC endorsement by Nepali parliament, there have been protests, led by pro-Beijing political forces and their leaders, against the US program. The US still suspects that the project development could face hindrances—all the more so because the current government is led by the Maoist party with the backing of CPN-UML, another leftist force, as a major coalition partner.  Nuland’s trip also bears high significance amid growing US-China competition to increase their sphere of influence in South Asia. Nepal, which shares borders with China and India, has strategic importance for both Washington and Beijing. In this context, Kamal Dev Bhattarai spoke to foreign policy experts to solicit their views on Nuland’s visit. Who is Nuland? Victoria Nuland was sworn-in as Under Secretary for Political Affairs in April 2021. Prior to that, she was senior counselor at the Albright Stonebridge Group, a global strategic advisory and commercial diplomacy firm based in Washington, DC.  She was also a non-resident senior fellow at the Brookings Institution, distinguished practitioner in grand strategy at Yale University, and a member of the board of the National Endowment for Democracy. A US diplomat for 33 years, Nuland served as assistant secretary of state for European and Eurasian Affairs from September 2013 until January 2017 under President Barack Obama and Secretary of State John Kerry. She was State Department spokesperson during Secretary of State Hillary Clinton’s tenure, and US ambassador to NATO during President George W. Bush’s second term (2005-2008). Nuland served as special envoy and chief negotiator on the Treaty on Conventional Arms Control in Europe from 2010-2011, and as deputy national security advisor to Vice President Dick Cheney (2003-2005). In addition to two tours at NATO in Brussels, she has served overseas in Russia, China and Mongolia, and in various assignments at the State Department in Washington. Nuland has a BA in history from Brown University. Reading into the high-profile visit Engaging Maoist-led govt  Sanjaya Upadhyay, US-based foreign policy expert I believe the underlying message the United States wants to send to Nepal at this juncture is that Washington is fully vested in securing its interests in this country. In that regard, Nuland’s visit is aimed at engaging the new Maoist-led government, especially amid suspenseful circumstances of its formation. She can be expected to convey the US commitment to strengthening its bilateral partnership with Nepal in all its dimensions. Washington might want to gauge Nepal’s commitment, specifically the extent of the importance the disparate coalition government attaches to relations with the United States. Washington is anxious to see the smooth implementation of the Millennium Challenge Corporation Nepal Compact along with other projects the United States has funded in the country. Nuland can also be expected to affirm her government’s desire to see a strengthening of the democratic process in Nepal amid growing popular disillusionment here. She might want to nudge Nepal toward completing the long-delayed task of promoting transitional justice. Advancing the cause of deprived and disadvantaged communities, and ensuring the rights of refugees as an intrinsic part of the democratization process could also be part of her message to the new government. Heightening US competition with China in recent years gives the US greater strategic incentives to strengthen its engagement with South Asia, where Chinese influence has been growing. Long-term engagement Mrigendra Bahadur Karki, executive director, CNAS Since the establishment of ties between the two countries in 1947, the US has been continuously and consistently engaging with Nepal, despite repeated regime change in Nepal. The US has a long-term vision and has a recorded history of how it wants to engage with Nepal. In Nepal, we view our relationship with the US through the prism of some specific events and phenomenon, which is flawed. Regarding the US engagement with Nepal, the importance of our geopolitical location is already there. As far as the visit of Nuland is concerned, her major purpose is to convey the US position on bilateral, regional and international issues and read the mind of the newly-formed government under Pushpa Kamal Dahal. At this point, it is a major responsibility of both Nepal and US governments to fully implement the MCC and complete it within the five-year deadline. Geopolitics at centerstage Chandra Dev Bhatta, geopolitical analyst Nepal's engagement with the US has increased in recent years in more ways than one and at various levels. This demands frequent exchanges of visits not from one side but from both sides, which sadly has not been the case. Yet, it certainly becomes important for a superpower like the US, for whom all the countries are equally important irrespective of their size, to maintain the status quo, and Nepal certainly cannot be left out in that context. Likewise, evolving geopolitics in Asia further demands US engagements to look into the re-emerging power relations in the Himalayan Asia, where Nepal remains an important country. This particular visit is taking place at a time when Kathmandu has a new government and the MCC project is just underway with more initiatives in the pipeline. With the new government in Kathmandu looking very shaky, chances are such that many things may either fall apart or would not move into the right direction. The current state of affairs in Nepal and the evolving geopolitics in the region demands better understanding of the situation, which makes this visit only natural. An assessment visit Rupak Sapkota, foreign policy expert Before the November 20 elections, it was widely presumed that the Nepali Congress-Maoist coalition would remain intact. But that didn’t happen. External forces are keenly watching the foreign policy priorities and orientation of the new government. I think the key purpose of this visit is to read the mind of the new government regarding its policy toward America. As a key coalition partner of the erstwhile government, Prime Minister Pushpa Kamal Dahal facilitated the endorsement of the MCC. So, I think the US is ready to work with the new government. In a way, it is an assessment visit from the US side. America seems confident that the US-Nepal bilateral relationship will move ahead under Dahal’s leadership. The prime minister and other leaders should convey their clear message that Nepal wants to stay away from the US-China geostrategic rivalry and wants to engage with all powers on economic terms. From our side, we have to be frank and candid about our priorities.

“Our main agenda is the restoration of the Hindu state and scrapping the federal structure. For this, our impactful presence in the government is necessary. Now our agendas will get traction in parliament as well.” This is a part of speech delivered by Rastriya Prajatantra Party Chairman Rajendra Lingden, also the deputy prime minister and home minister in the Pushpa Kamal Dahal-led coalition government, in his hometown Jhapa on January 23. Previously, another RPP leader and Law Minister Dhurba Bahadur Pradhan had said in a TV interview that the federal structure should be dismantled. Prime Minister Dahal learned about the RPP’s long game of doing away with federalism and secularism—two cornerstones of the 2015 constitution—when he attended the National Assembly meeting on January 24.  At the meeting, NA member from the Nepali Congress, Anita Devkota, raised an objection to the statement made by Minister Pradhan. In response, the prime minister assured the Upper House that his government was fully committed to federalism. He even vowed to seek clarification from the concerned minister(s) for making anti-federal statements. Dahal did not seek any clarification from Pradhan, nor Lingden for that matter. Doing so would shake the precariously balanced coalition of seven parties. Political analyst Binoj Basnyat says Prime Minister Dahal saying that he will demand explanation from his minister for making anti-federal remarks is a mere posturing to show that he has the confidence of continuing this government without the support of fringe parties. Besides, he adds, Dahal does not want to appear as a weak leader before his party. The truth, however, is that Prime Minister Dahal is not in a comfortable position to rattle the coalition, which is a disparate collection of political parties with opposing ideologies. RPP is a pro-monarchy, right wing Hindu party that opposes secularism and federalism, and Dahal leads the Maoist party that led a decade-long armed insurgency to overthrow the monarchy and bring a federal republic system in Nepal. The newly emerged political force, Rastriya Swatantra Party led by Rabi Lamichhane, is also known for its disdain towards the federal system. The party did not field its candidates in the provincial assembly elections. Though the party has not made any formal stance regarding federalism, a bulk of its leaders and cadres want to reinstate unitary government. Without the RPP and RSP, which together hold 34 seats in parliament, Dahal knows his government will collapse. Dahal has said that his key priority is to fully implement the constitution by strengthening the current federal structure and concluding the peace process. But he faces opposition from within his own government. Haribol Gajurel, Dahal’s political advisor, says that the prime minister is fully committed to the 2015 constitution by fully implementing federalism. How he will do that with parties like RPP and RSP in the coalition nobody knows. RPP and RSP will enjoy the role of kingmakers even if Dahal’s CPN (Maoist-Center) parted ways with its current main coalition partner, CPN-UML, to form a government with the Nepali Congress. Their support will be decisive even if the UML and NC were to form a government without the Maoists. Dahal fears the anti-federal sentiment will seep into the general public, not from outside but from his own government partners. He is not even sure of the UML, as KP Sharma Oli has made abundantly clear that he is not happy with the current political system. In recent years, Oli has been building his party on nationalist plank and he sees federalism as a hurdle. When Dahal became the prime minister in December, this paper had pointed out how he would have a tough time managing the conflicting interests of his coalition partners. Within a month into his premiership, it seems that the coalition unity is fraying. Prime Minister Dahal is also under pressure from Madhes, Janajati, Tharu, and other marginalized communities to address their concerns. Already, Nagarik Unmukti Party and Janata Samajbadi Party are threatening to withdraw their support if their demands are not addressed. Dahal has a herculean task of managing his coalition partners. Political analyst Bijaya Kanta Karna says managing the right-wing parties in the coalition remains the single-most challenge for Dahal. The prime minister does not want to dent his image as a champion of republicanism, federalism, inclusion, and secularism, but he has been thrust in a position where he must take a tough position with the parties that oppose these ideas, adds Karna. One way to offset the influence of RPP and RSP for Dahal is to bring Janata Samajbadi Party, Nagarik Unmukti Party, Janamat Party, and Loktantrik Samajbadi Party on board. This is easier said than done, says Karna, for there is a risk of the UML pulling support from the government. The UML had played an important role to bring RPP and RSP on board the coalition. Prime Minister Dahal must tread with extreme caution in order not to irritate the UML by pushing away either RPP or RSP.

No leader in the CPN (Maoist Center) has been as consequential as Pushpa Kamal Dahal. The 68-year-old former rebel leader, who waged a decade-long armed insurgency against the state before entering peaceful politics in 2006, has become prime minister three times in the past 15 years. The only other Maoist leader to become prime minister is Baburam Bhattarai, who left the party in 2015. Dahal, sometimes referred to as the Maoists supremo, has been ruling the roost since the party’s rebellion days. Despite the presence of other influential leaders like Bhattarai, CP Gajurel and Mohan Baidya (the three are no longer with the Maoist party), it was Dahal, who gripped public and media imagination during the wartime. Better known by his nom de guerre Prachanda at the time, Dahal developed a cult around himself. There was an air of mystery about him. Most Nepalis saw him in person only after the party joined the peace process. While the cult of Prachanda might have helped the Maoist party become a major political force, it has also the potential of ruining it. Despite his many faults as a leader—from promoting nepotism to flip-flopping in his decisions to joining unnatural alliances to remain in power—Dahal is still revered by his supporters. One could even argue that the Maoist party is nothing without him. Though Dahal has no immediate plan of retiring from active politics, the virtual absence of successors is a cause for concern. While Bhattarai is said to be preparing to return to the mother party, his return is not going to make much of a difference. Bhattarai and Dahal are of the same age—and, more importantly, the former has already made his intention clear about retiring from active politics one day. This leaves the Maoist party with a smattering of leaders like Narayan Kaji Shrestha, Barsha Man Pun, Janardan Sharma, Dev Gurung and Krishna Bahadur Mahara. But the truth is these leaders are nowhere close to Dahal. The future of the Maoist party is at stake because it never invested the time and energy to build its organizational strength. Ever since joining the peace process in 2006, the Maoist leadership has more or less wasted time in power politics and suffered multiple splits. In the first Constituent Assembly election of 2008, the Maoists emerged as the largest party ahead of traditional big old parties, Nepali Congress and CPN-UML. But the subsequent elections—CA polls of 2013 and the general elections of 2017 and 2022—have seen the party become progressively weaker. The Maoists' merger with the UML to form the Nepal Communist Party (NCP) also proved disastrous, as the party broke up within less than three years. In the process, the Maoist party lost one of its senior leaders, Ram Bahadur Thapa, who went on to join the UML. The recent general election saw Dahal’s party come in third position, securing just 32 seats in the 275-member parliament, behind the Nepali Congress (89) and the UML (78). Dahal became the prime minister after breaking the alliance with the NC and joining forces with the UML. Multiple leaders that ApEx spoke with admitted that the Maoist party’s organizational strength has suffered so much that there are only a few constituencies from where the party can win elections on its own. The party forged an electoral alliance with the NC in the Nov 20 polls of last year out of this very fear. And yet the party could secure only 32 parliamentary seats, which is 17 fewer than the 2017 election. Party leader Haribol Gajurel says they have virtually no organization at the grassroots, without which their existence is in danger. Gajurel is in favor of reviving the party’s organization across the country, but he is unlikely to get Dahal’s nod, with other senior leaders like Shrestha, Pun, Sharma, Gurung and Mahara on the line. That is why Gajurel has been appointed as an advisor to Prime Minister Dahal. Party leaders say Pun and Sharma are more likely to win Dahal’s trust when it comes to handling of the party affairs. Shrestha, despite being Dahal’s trustee and a deputy, does not have a strong support base within the party, while Mahara has more or less taken a backseat following a rape allegation on which he got clean chit from court. Similarly, Gurung is someone who had defected from the party in 2013 to join the Baidya faction. Maoist leaders say now there is mainly a two-horse race between the general secretary duo Sharma and Pun to take lead of the party affairs. Both of them have considerable influence in the party structure, so much so that Dahal has to pick the leaders close to them while making key appointments in the party and the government. During the distribution of election tickets ahead of the Nov 20 polls, Pun and Sharma were dominant after Dahal. After the elections, two leaders stood on opposite corners on the issue of government formation. Sharma, who had served as finance minister in the Deuba-led government, stood in favor of continuing the pre-poll alliance, while Pun actively worked to bring communist forces together. But despite their growing clout and power within the party, Sharma and Pun can never measure up to Dahal. In any case, if one of them were to helm the party, there is bound to be a factional rift within the Maoists, which could be even worse for the party. It has been a year since the Maoist Center organized its general convention, and the party is yet to form its politburo and standing committees. Due to the party split, it took a long time for Dahal to select the party's office-bearers. The party has also yet to form its departments. Sharma is actively trying to take control of the party’s organizational department. A few weeks back, he even held a meeting of the party's organizational department where he came under fire. Maoist central committee member DP Dhakal said Dahal is unlikely to pick one specific leader to look after the party affairs, as the party is preparing to convene a central committee meeting for discussing ways to strengthen the party's organizational base. The meeting, added Dhakal, will most likely form committees to oversee the party activities collectively. Senior journalist Babin Sharma, who closely follows the politics of the Maoist party, said while Pun and Sharma are competing for the party leadership, Gurung, a general secretary picked by Dahal himself, could lead the party affairs. He said Gurung has a fairly good command in the party for the job. But central committee member Ramdeep Acharya has a different take on the issue of picking the next Maoist party leader. He said there are different modalities of the leadership selection process, so one cannot be certain as to who will replace Dahal. Acharya added Dahal selecting his successor is one of the modalities but there are other ways too. Whoever comes forward to lead the party, they will have big shoes to fill.

The Nepali Congress is desperate to get the presidency after the CPN-UML’s Dev Raj Ghimire was elected the speaker of parliament on Jan 19. The NC leaders are of the view that the UML cannot have both speaker and president, as it goes against the idea of separation of powers. The next president, they say, should be from their party, or at least, someone proposed by them. As part of a power-sharing deal, CPN (Maoist Center) has agreed to lead the coalition government for 2.5 years before ceding the prime minister’s office to UML. A midterm transition of power means the UML will eventually head the executive as well as the legislature. Under such a circumstance, the NC reckons they cannot allow the UML to have the presidency as well. NC spokesperson Prakash Sharan Mahat has warned that the country could plunge into a constitutional crisis if all the vial positions are occupied by the UML. He has said it is time for Prime Minister Pushpa Kamal Dahal to prove that he stands in favor of separation of powers and the constitution. Like the NC, the Maoist party too is concerned about giving all vital positions to the UML. Dahal is wary that UML leader KP Sharma Oli could become all-powerful and sideline him. The prime minister has said that he is working to bring the NC on board for presidential election, but has not explicitly stated that he would support the NC candidate. When Dahal took a vote of confidence in the House of Representatives on Jan 10, the NC had backed him with the hope that their gesture would be reciprocated in the form of either speakership or presidency. With the UML winning the speaker’s seat, the NC hopes to get Prime Minister Dahal’s support on the day the parliament elects the new president of the country next month.   But so far there has been no confirmation from the prime minister, and some NC leaders, including Shekhar Koirala, are already regretting the decision to give the trust vote to Dahal. NC leader Sher Bahadur Deuba and his supporters, however, are still hopeful that they will succeed to get the presidency and drive a wedge between the Maoists and the UML. Two probable presidential candidates from the NC are Ram Chandra Poudel and Krishna Prasad Sitaula. Poudel has been in constant touch with Prime Minister Dahal as well as Chairman of CPN (Unified Socialist) Madhav Kumar Nepal to seek their support in his presidential bid. Sitaula, who closely worked with the Maoists during the peace and constitution drafting processes, is regarded as a suitable candidate whom Dahal would have no trouble supporting.   By securing the presidency, the NC wants to create a rift between the Maoists and the UML, two of the largest leftist parties in the country.    Some Maoist leaders are of the view that the party could break alliance with the UML if NC comes up with a credible long-term vision of partnership between the NC and the Maoists.   A Maoist leader, who spoke on condition of anonymity, said first the NC should come up with a concrete view that it wants to be in a continued alliance with the Maoists for at least next five to ten years. A section of the Maoist leaders want to enter a long-term alliance with the NC also because they want to settle the war-era cases with little damage to the party. With the NC as their ally, they reckon they could work out a way to investigate and prosecute only those cases related to serious human rights violations and secure clemency for others. The Maoist leader said since NC is a democratic party trusted by the international community, its credentials could be instrumental in settling the war-era cases. Haribol Gajurel, Dahal’s political advisor, has said the prime minister is working to forge a consensus among major parties in the presidential election. He added consensus building is imperative because some major tasks of the peace process still remain unsettled and the constitution is yet to be fully implemented. For the Maoist party, the NC’s role is important to conclude the transitional justice process as soon as possible. There are geopolitical interests regarding the presidential election in Nepal. The positions of prime minister and president have emerged as parallel power centers, and foreign powers could serve their interests through the president if not the prime minister. So there is also a chance that the new president could be an individual recommended by the NC and not necessarily the party leader.  

On January 12, the United States and Japan jointly organized the fifth Indo-Pacific Business Forum in a hybrid formation in Tokyo. According to the US Department of State, more than 140 in-person and 1,000 virtual business and government leaders from the US and Japan, economies of the Indo-Pacific region, and countries around the world participated in the meeting. The IPBF is a vital pillar of America’s Indo-Pacific Strategy, which envisions a free, open, connected and resilient Indo-Pacific region. An IPBF meeting is a routine program that has been taking place for a couple of years now. The previous meeting was held in 2021, and co-hosted by the US and India. It was the first IPBF meeting in South Asia. Unlike the previous government under Donald Trump, which took a more confrontational approach to China, the Joe Biden administration has framed the implementation of IPS focusing more on economy and through its allies and partners. In February 2022, President Biden introduced a new IPS, which replaced the document unveiled by his predecessor in 2019. In line with the new US strategy, South Korea earlier this month unveiled its own IPS, which aligns to the American policy of containing China’s rise in the region. In the recent months, the US and its IPS allies have stepped up their engagements in the region with new policies and programs. The latest instance is of the IPBF, which includes several countries in South Asia including Nepal, making new announcements targeting the region. First is the US Trade and Development Agency’s call for infrastructure activities that support the Indo-Pacific Economic Framework pillars of advancing digital infrastructures, promoting clean energy, and strengthening supply chains. The second proposal is to expand the agency’s portfolio in the Pacific Island countries. The Tokyo meeting also decided that the IPEF Infrastructures Accelerator Team would work across US government agencies and like-minded IPEF partners to identify and define bankable projects that can unlock new public and private funding. The team is set to visit India, Indonesia, Malaysia, the Philippines, Thailand, Fiji and Vietnam in the near future. “The Indo-Pacific is core to our mission,” declared Scott Nathan, CEO of US International Development Finance Corporation, in his opening remarks of the IPBF meeting. “We have over 6.6 billion dollars in active commitment throughout the region. And just this past year we committed more than two billion dollars to a diverse set of nearly 50 transactions that bolster economic growth and development across a range of sectors,” he added. This shows that the US is eager to gain a strategic one-upmanship over China when it comes to holding clout over South Asia. “Washington's acknowledgement of the Indo-Pacific as the fastest growing and most dynamic region in the world continues to serve as a catalyst for its desire to strengthen ties with allies and strategic partners of the region,” says Don McLain Gill, director for South and Southeast Asia at the Philippine-Middle East Studies Association. “Inevitably, the key driver for US interest in the region is China's rise and its dissatisfaction with the US leadership and the alliance network.” While US material capacity and hard power are unmatched, Gill says, its image continues to face challenges, particularly among regional states. “Moreover, the speed of China's military modernization also creates problems for the US' ability to secure the established rules-based order.” Recognizing this, the US engagement in the Indo-Pacific should be seen through the prism of the region's emerging multipolar dimensions, which have bolstered Washington's coordination with like-minded powers such as Japan and India. “Along with the preponderance of the US material capabilities, Washington's Indo-Pacific engagements also rest on maximizing the function of its bilateral and multilateral partnerships to add more value and dynamism to its approach towards the region,” says Gill. American officials have said that they will further enhance the engagement in this region in 2023. In the words of Kurt Campbell, Biden’s Indo-Pacific Coordinator: “America and allies are looking at India as a country they want to draw more into the Indo-Pacific.” "Our interests are to see India playing an ever larger, responsible role in almost everything that we're doing," Campbell said in an event in Tokyo. Neeraj Singh Manhas, director of Research in the Indo-Pacific Consortium at Raisina House, New Delhi, says in the past few months the US engagement in the region is increasing, and it is also using economic and grey zone coercion tactics. According to his reading, Washington has been renewing innovation and developing new concepts of operations as well as resilient command structures, prioritizing the network of allies and partners, fostering interlinking security ties, countering the trafficking of weapons, drugs and people, and improving cyber-security in the Indo-Pacific region. In Nepal, too, the US is stepping up its economic engagement. In September last year, the USAID and the Ministry of Industry and Commerce jointly launched a trade and competitiveness or T&C project. The overall goal of the project is to increase inclusive and broad-based sustained free and fair trade as well as competitiveness in the Indo-Pacific region. The project falls under the broader framework of the IPS, but the ministry has said that the project launch does not make Nepal a part of the IPS, and that it will only play the role of an advisor to the program. Similarly, in May last year, Nepal-US signed a grant agreement of $659 to support Nepal’s goal to be a middle-income country. It is noteworthy that the US, along with 13 countries in South Asia, launched the IPEF that same month to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness in the region. The US officials are in talks with the countries in the region that have not yet officially joined the framework. They are conveying the message that the US wants South Asian countries to be part of all components of IPS. Those countries that are not part of the IPS regard it as a military alliance. As a result, opinions are divided whether to join or stay out. Bangladesh has recently informed the US that it needs some time to study the IPEF before coming to a decision. The IPS remains a highly divisive issue in Nepal as well. That is why the official documents and US officials rarely mention IPS while announcing or implementing the programs under it.  Perhaps the word ‘Strategy’ has created doubt. As the US Ambassador to Nepal Dean Thomas recently said that it is better to call it “Indo-Pacific Policy” instead of strategy. New Commercial Initiatives in Indo-Pacific -In October 2022, Honda and LG Energy Solution announced they will build a $3.5 bn EV battery plant in Ohio that will create at least 2,200 new jobs. -In July 2022, Panasonic announced a $4 bn investment in batteries in Kansas that will hire as many as 4,000 people. -In April 2022, Toyota announced a major investment in sustainable transportation with an investment of $383m across four US plants to support fuel-efficient hybrid vehicles and build the workforce of the future. -In 2021, Japan announced additional budget to develop its semiconductor industry, and supported several new projects in 2022, including:

• Taiwan Semiconductor Manufacturing Co. (TSMC) and Sony received $3.5 billion in support for a joint venture to build a new chip fabrication plant.

 

• Kioxia Corp. and US firm Western Digital Corp. received $680m for a semiconductor production facility.

 

• Japan’s Ministry of Economy, Trade, and Industry agreed to provide $320m in investment support to US semiconductor manufacturer Micron to accelerate the manufacturing ramp up of advanced chips at its Hiroshima facility.

-The Department of State, Bureau of Energy Resources’ Power Sector Program, has pledged to provide technical assistance to the Malaysian electric utility company, Sabah Electricity Sdn Bhd (SESB) to displace up to 100 MW of diesel generation with solar and battery storage deployment. -The US Trade and Development Agency has approved funding to NOW Telecom Company, Inc. for technical assistance to support the development and implementation of a fifth generation (5G) stand-alone network in the Philippines. -A USTDA grant to the Electricity Generating Authority of Thailand is funding a feasibility study to assess the technical and economic viability of retrofitting the Vajiralongkorn Dam in western Thailand with a grid-connected pumped storage hydropower (PSH) plant. -USTDA is providing a technical assistance grant to support the digital transformation of the Malaysian electric utility company, Sarawak Energy Berhad. -USTDA and GE Healthcare will co-fund a pilot project to support the Indonesian Ministry of Health develop a national image and data repository, creating a new cloud-based centralized warehouse for electronic medical records and a hub-and-spoke network connecting general practitioners in primary care facilities with cardiologists in a central hospital. -The US International Development Finance Corporation has more than $6.6 bn in total active commitments across the Indo-Pacific region, invested across 395 individual projects. The agency committed $2.1 bn of financing across 49 projects in the Indo-Pacific region in fiscal year 2022 alone.  DFC has active commitments in 16 countries throughout the region. -Since October 2022 DFC has approved three new projects worth approximately $110m of total investment to advance economic growth and development in India and across Southeast Asia, including expanding access to electric vehicles in India. A $5m loan will enable Revfin Services Private Limited, a digital lending company that leverages non-traditional data to underwrite electric vehicle financing loans, to expand financial access and inclusion for underserved individuals and communities and provide an e-mobility solution to support India’s clean energy transition. Source: in.usembassy.gov 

The latest summit of the South Asian Association for Regional Cooperation was held in Kathmandu in 2014. The next iteration of the biennial regional meeting was supposed to be hosted by Pakistan in Islamabad, but it was postponed indefinitely due to the India-Pakistan tensions. In the nearly four-decade-long SAARC history, this is the first time the summit-level meeting has not taken place for a long time. As though the India-Pakistan rivalry was not enough, Taliban’s takeover of Afghanistan in 2021 has further pushed SAARC’s future into uncertainty. While there has been no summit-level meeting in more than eight years, the SAARC Secretariat in Kathmandu has been conducting its activities, including holding ministerial-level meetings of the member states in a bid to revive the moribund regional body. Even during the Covid-19 pandemic, SAARC representatives made it a point of holding virtual meetings. But now SAARC stares at another potential crisis in a form of leadership vacuum, as the incumbent Secretary General Esala Ruwan Weerakoon approaches the end of his term. Weerakoon, who assumed office on 1 March 2020, will complete his term in March this year. To date there has not been any decision about his successor. This is because it is now Afghanistan’s turn to send a new secretary general. Like the international community, the SAARC member nations have not recognized the Talibans as the legitimate government of Afghanistan. As a SAARC chair, Nepal has been holding consultations with member states to find a solution, albeit without any progress. As the member countries, primarily India, have not shown any interest, Nepal’s efforts alone cannot yield any results. Despite the stalemate-like situation, a couple of options are under discussion. First, asking Bangladesh to recommend secretary general by skipping Afghanistan by rule of alphabetical order. A source at the Ministry of Foreign Affairs said as Afghanistan’s nomination cannot be accepted under current circumstances, asking Bangladesh to send its representative can be one of the options. The second option is for Nepal, as a SAARC chair, sending a secretary general—most likely a senior official working at the secretariat— until the new arrangement is made. However, as per SAARC charter, all decisions should be taken in consensus. This means a decision taken without Afghanistan’s consent could create a question of legitimacy. Experts say SAARC’s relevance is dying also because India, as the most powerful and influential member state, has turned its back on the regional body and shifted its focus on other regional organizations, like BIMSTEC. Shambhu Ram Simkhada, former Nepali ambassador to the United Nations, is of the view that as a SAARC chair, Nepal should play a proactive role to revive SAARC. He said since some big member countries do not seem interested in keeping the SAARC alive, Nepal has to make its position clear. He added that Nepal’s political leadership should take up this issue with the leadership of other member countries. Initiatives taken from the bureaucratic level, according to Simkhada, cannot yield any substantial result. Some officials want Prime Minister Pushpa Kamal Dahal to raise the issue of SAARC with his Indian counterpart Narendra Modi and other senior government officials during his India visit. They also want Foreign Minister Bimala Rai Poudel to do her part. Among other tasks, she also has the responsibility of resolving the problem faced by SAARC. Nepal has always been a strong proponent of regionalism and it was one of the chief architects of SAARC. The country should not give up on the regional body that easily.