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King Prithvi Narayan Shah, the founder of modern Nepal, once stated, ‘Nepal is a yam between two boulders.’ This statement has become an evergreen mantra for understanding and managing Nepal’s foreign affairs. According to him, the ‘two boulders’ are India and China, and Nepal’s strategy has always been the ‘strategy for survival,’ as rightly pointed out by Leo E Rose. In realpolitik, all strategies are inherited within the geography of the country—‘Geography is the mother of strategy’. Secondly, geography stands as the most prime factor in implementing the foreign policy of any state because, in most cases, it is ‘fixed’.

Within Nepal, the sentiment of the people has always been a fear of two dynamics: the fear of foreign intervention and natural disasters/earthquakes. To elaborate further, Nepal shares close ties with India in many aspects, from geography to politics, economy, and culture. People in Nepal often find themselves in a forced position to balance ‘sovereignty and integration’ with India. At the same time, China is no longer an ‘inactive’ force in global politics and has an interest in South Asia. That ‘interest’ is sometimes ‘hard’ too. As a Nepali, the fear of being caught in the ‘radar’ of these giants, including the impact of extra-regional powers like the US, can’t be ignored. Nepal resides in an earthquake-prone area, and the foundation of every development must focus on earthquake resilience. These two ‘fears’ have been haunting Nepal and its people for quite a long time.

Power centers have a ‘natural’ interest in the country located between two giants with a comparatively low level of governance efficiency and societal development, allowing foreign aid  ‘projects’ to flourish, thanks to an unfavorable investment climate that curtails FDI in the country.

Nepal-India development partnership

Since the 1990s, India’s foreign aid to Nepal has been largely guided by the Gujral Doctrine. The doctrine states that, “India does not ask for reciprocity with its neighbors like Nepal, Bangladesh, Bhutan, the Maldives and Sri Lanka. Instead, it gives and accommodates what can be given in good faith and trust.” However, as a neighbor, India has not effectively translated these narratives with its smaller neighbors, resulting in tensions from time to time.

When Indian Prime Minister Narendra Modi assumed power in 2014, he endorsed the Neighborhood First policy, making five trips to Nepal—unprecedented in the past 17 years for any Indian Prime Minister. These visits symbolized strong ties and demonstrated a commitment to collaborating with Nepal based on its development needs. Since May 2014, there have been 17 exchanges at the level of Head of State/Head of Government. Aligned with the ‘Neighborhood First’ policy, Indian Prime Minister Modi has visited Nepal five times, and the Nepali Prime Minister visited India eight times since Jan 2015.

Since 1954, after the establishment of the Indian Aid Mission in Nepal, India has supported Nepal in the development of major infrastructure projects, including the construction of Tribhuvan International Airport, water supply systems and hospitals.

After India’s economic blockade in 2015, India has been actively involved in the development of connectivity with Nepal through construction of Integrated Check Posts and Railways in Nepal. To facilitate the construction of two broad-gauge cross-border railway links—Jayanagar-Bardibas and Jogbani-Biratnagar—financial and technical assistance was provided to Nepal. Furthermore, MOUs were signed to conduct the Final Location Survey for the proposed broad-gauge line between Raxaul and Kathmandu in October 2021. The Draft Detailed Project Report resulting from this Final Location Survey was submitted to Nepal in July 2023 for review and consideration. In FY 2020-21, India provided a grant of $10.93m, a loan of $60m, and $1.38m as Technical Assistance.

India’s shift

The year 2015 marks India’s shift away from engagement in politically sensitive issues with Nepal (in most cases), replacing it with a focus on development agendas. Additionally, India’s grassroots engagement has been facilitated through High Impact Community Development Projects (HICDPs). In Jan 2024, the cap of each project under HICDPs was increased to Rs 200m. Due to India’s intense engagement in Nepal’s political affairs since 1950, HICDPs have been at the center of debate in Nepal, with concerns about India's alleged intervention at the grassroots level to promote its vested interests.

Challenges

Despite such collaborative efforts, Nepal’s trade deficit with India has been steadily increasing. In 2015-16, Nepal’s trade deficit with India stood at $3,581m, with exports amounting to $419m and imports reaching $4,000m. By 2021-22, Nepal’s exports to India had increased to $1,330m, while imports surged to $9,580m, resulting in a trade deficit of $8,250m. In May 2024/25, Nepal’s trade deficit with India reached $9.63bn. This growing trade deficit is primarily due to Nepal’s heavy reliance on Indian petroleum products, vehicles and consumer goods, while Nepal’s exports, mainly agricultural products, struggle to compete in the Indian market.

In April 2022, both countries released a ‘Joint Vision Statement on Power Sector Cooperation’ to enhance power cooperation. However, within Nepal’s political circles, many Nepalis perceive this vision statement as India’s attempt to control Nepal’s water resources while discouraging investment from other foreign players. This perception has been reinforced by India’s consistent reluctance, both in actions and statements, to purchase electricity generated through Chinese capital or contractors in Nepal.

Way forward

Concluding all of the above, India has been focusing on connectivity issues between Nepal and India after India’s economic blockade in 2015, moving away from hardcore political issues. The increasing connectivity with India will help Nepal unlock new potentials, but due to Nepal’s own internal limitations and turbulence, this has resulted in a deeper economic dependency on India rather than interdependence.

India’s involvement at the grassroots level, aimed at empowering local communities through foreign aid and accounting for 35 percent of FDI stock, undeniably highlights its significance in Nepal. Furthermore, Nepal’s geographical positioning—surrounded by India on three sides—places it in a ‘locked’ relationship with India. The interplay between geographical proximity and distinct national identity has led to numerous fluctuations in their political dynamics since the 1950s.

From Nepal’s side, there is a growing perception that India is accelerating its connectivity development projects in Nepal at a time when Nepal is overwhelmed by multiple development commitments from China. Whether India is responding only after Chinese pledges to Nepal or if this is merely a coincidence remains a matter of debate. However, the narrative in Indian media and public discourse about Nepal shifting toward a pro-China stance is a fabricated attempt to undermine bilateral relations between Nepal and India.

Summing up, Nepal and India should move ahead by taking into account each other’s security sensitivities resulting from the open border.

With the growth of its power, China’s overseas interests are rapidly expanding. Along with this, in addition to the extreme containment and suppression by Western countries, there are also various ‘stigmatizing’ hype such as ‘neo-colonialism’, ‘debt trap’, ‘China threat theory’ etc.. This highlights the sharp cognitive opposition between China and Western countries in expanding overseas interests.

Expansion methods

Win-win cooperation vs zero-sum game

The concept of win-win cooperation proposed by China emphasizes achieving complementary resources and shared advantages through close cooperation with host countries, thereby fostering mutual benefit and ultimately leading to common development and maximized interests. The ‘Belt and Road Initiative’, put forward by China in 2013 and based on the concept of win-win cooperation, has achieved numerous results, covering policy communication, facility construction, trade cooperation, investment growth, and project construction etc., injecting new momentum into global economic growth. China’s pursuit of a win-win development path in expanding its overseas interests is the right path for the world.

Driven by zero-sum game mentality, in international politics, Western countries focus on safeguarding their own interests, viewing China’s expansion of overseas interests as a threat to their own interests, and fearing that China’s strength could undermine their power and status in host countries. The zero-sum game mentality espoused by Western countries is detrimental to others and not beneficial to themselves, often leading to tension and conflict in international relations.

Expansion approach

Peaceful development vs ‘Thucydides Trap’

The term ‘Thucydides Trap’ is used metaphorically to describe the competitive situation among major powers in contemporary international relations. Specifically, when an emerging power rises and attempts to play a greater role on the international stage, it often clashes with existing powers in terms of resources, markets, influence, or geopolitical advantages. This situation of mutual confrontation and threat may ultimately lead to the outbreak of war. Based on the cognitive logic of Thucydides Trap, Western countries often pursue containment and suppression strategies towards the friendly cooperation between China and host countries in areas such as economy, military, and technology.

However, ‘Thucydides Trap’ is not an iron law, and war does not necessarily break out between major powers. China’s concept of peaceful development reflects the common pursuit of peace and development by countries around the world, offering the possibility to avoid the ‘Thucydides Trap’. Based on the concept of peaceful development, China has always been committed to becoming a builder of political peace, a contributor to economic development, and a maintainer of social order for host countries in the expansion of its overseas interests.

Expansion path

Co-consultation, co-construction, and sharing vs colonial plunder

The expansion of overseas interests by Western countries employs the bloody and brutal method of colonial plunder. Specifically, Western countries maintain their colonial rule through violent occupation of land and signing unequal treaties. By occupying, enslaving, and exploiting weak countries, they gain financial and trade privileges, as well as plunder natural, human, and strategic resources. They expand their sphere of influence and balance competitors through colonial expansion in order to ensure their own security and national interests. They regard themselves as disseminators of civilization, attempting to establish a kind of social structure and cultural identity in colonies that is similar to that of their homeland.

Guided by the principles of co-consultation, co-construction, and sharing, China promotes joint consultation with host countries in the expansion of overseas interests. This ensures that host countries have an equal voice and participation rights, enabling political disputes and economic conflicts to be resolved through consultations. Cooperative projects are jointly undertaken by both parties, with the results shared to foster mutual development and prosperity. Furthermore, it aims to involve citizens of host countries as participants, contributors, and beneficiaries of these projects, particularly ensuring that local residents also reap the benefits, thereby creating a conducive and friendly environment for the expansion of China’s overseas interests.

Expansion goal

Community with a shared future for mankind vs hegemony and power politics

Based on the concept of a community with a shared future for mankind, China is dedicated to promoting high-quality development in host countries during the expansion of its overseas interests, implementing global development initiatives, global security initiatives, and global civilization initiatives in these countries. China is proactively addressing various complex social issues, and encouraging more citizens of host countries to participate in Chinese projects and share dividends, thereby contributing Chinese wisdom and solutions to the economic and social development of host countries and demonstrating its responsibility as a major power. The concept proposed by China has garnered support and endorsement from the majority of countries worldwide, particularly those from the ‘Global South’.

The hegemonic behavior of Western countries manifests as gross interference in the internal affairs of other countries, manipulation of international affairs, and expansion of spheres of influence through military means. The core idea of power politics is that ‘power is truth’, referring to the policies and activities of Western powers that bully the weak, arbitrarily dominate other countries’ people, interfere in other countries’ internal affairs for their own interests, and infringe on other countries’ interests. Based on the logic of hegemonism and power politics, Western countries have seriously damaged international peace and stability, the well-being of people all over the world, and the common interests of all mankind through various perverse acts in the world.

Conclusion

In response to the cognitive opposition between China and western countries in expanding overseas interests, China should uphold the concept of peaceful development and win-win cooperation, and strive to build a community with a shared future for mankind. At the same time, in countries where China’s overseas interests are expanding, China should take practical actions of extensive consultation, joint contribution, and shared benefits to practice its own propositions and demonstrate international fairness and justice.

The author is  Dean of China’s Overseas Interest Studies Institute at Yangtze Normal University

Nepal has ample renewable energy resources, which creates a feasible opportunity for hydrogen production. There is still a worldwide debate on the best medium for producing hydrogen, where solar and hydropower are the key competitors. For Nepal, achieving a balanced energy mix is essential, and solar energy has the potential to play a larger role in the 10 percent share of alternative energy in the overall energy mix. Nepal has significant solar energy potential, comparable to its hydropower resources, making it an attractive option for diversification. This article evaluates the pros and cons of hydrogen production using solar and hydroelectric energy, with a comprehensive techno-economic comparison to determine the most suitable approach for Nepal.

Solar potential

Various studies demonstrate that Nepal has a strong solar energy potential. The Investment Board Nepal (IBN) issued its ‘Energy’ report in April 2024 which states that Nepal receives sufficient solar radiation to produce between 3.6 and 6.2 units of electricity per square meter area. The daily solar energy intensity across Nepal's surface reaches an average of 4.7 kWh per square meter. Statistical data demonstrates that solar energy possesses great potential for implementation. According to a study by the Alternative Energy Promotion Center (AEPC) and the German Agency for International Cooperation (GIZ), the estimated total technical potential for solar energy production in Nepal is 432 GW (432,000 MW), which is tenfold higher than the economic and technical potential of hydropower (42,000 MW).

Current status

The renewable energy sector of Nepal exhibits rapid growth through solar energy development with eight new solar plants with a combined capacity of 90 MW starting operations in FY 2023-24. The nation remains committed to developing its power mix by establishing strategic Power Purchase Agreements (PPAs) to add more solar power capacity. The Nepal Electricity Authority (NEA) uses competitive bidding to acquire solar energy, setting a price ceiling of Rs 5.94 per unit. In a recent initiative, the NEA invited bids for 800 MW of solar projects and the evaluation and PPA signing for these projects will occur in FY 2024-25. The move seeks to strengthen Nepal's energy supply system by adding solar power to the current hydroelectricity dominance while ensuring power stability during winters when hydroelectricity generation decreases. 

The NEA intends to acquire 800 MW of solar energy in two years following the bidding period as smaller projects (under 10 MW) will start generating electricity within 18 months and larger projects will reach commercial operation in two years. According to the White Paper of the Ministry of Energy, Water Resources and Irrigation published on 8 May 2018, by capping solar contributions to 10 percent of the total installed capacity through Power Purchase Agreements (PPAs), Nepal is accelerating for a more balanced energy future, ensuring consistent electricity supply while embracing renewable sources to meet a rising demand.

Current status of hydropower

Nepal’s power sector depends fundamentally on hydropower operations. As of February 2025, the installed hydropower capacity in Nepal has reached 3,255 MW while economic potential exceeds 42,000 MW. The country aims to generate 28,500 MW of hydroelectricity by 2035, of which 17,000 MW will be exported to neighboring countries India and Bangladesh through eight international transmission lines as per an announcement from Minister for Energy, Water Resources, and Irrigation, Dipak Khadka. 

Nepal’s commitment to electricity exports will not prevent it from maintaining surplus electricity that can be efficiently used for hydrogen production. Hydropower provides a dependable source of electricity for hydrogen electrolysis at scale because its energy output remains stable, unlike solar power which faces daily and seasonal changes. This consistent nature of hydroelectric power provides a solid base for Nepal’s hydrogen economy development.

Comparison of solar vs hydroelectric hydrogen production

The global competition for green hydrogen production is accelerating, so renewable energy sources serve as the core solution and solar and hydropower are dominant leaders in this transition. Each offers distinct advantages and faces unique challenges in this evolving landscape. Multiple important factors can be used to conduct an extensive analysis.

• Energy generation stability

Hydropower delivers uninterrupted power, which makes it a better hydrogen production source than solar energy because solar power depends on sunlight availability and shows intermittent fluctuations. The continuous operation of hydropower systems runs 24/7 to deliver steady energy streams. Solar energy generation operates within daylight hours with a seven hours daily average in Nepal, forcing the implementation of storage units or backup power for stable hydrogen production.

• Land use efficiency

The competition between these power systems depends heavily on how efficiently land resources are utilized. Each megawatt of solar PV farm needs 0.02 square kilometers of land space for installation, thus presenting challenges in Nepal's geographically restricted areas. Hydropower requires approximately 0.1 km² per MW and helps to capitalize the existing water resources and infrastructure. A strategic solution involving NEA land at hydro project locations for solar power installations would create a hybrid energy system that maximizes both technologies for green hydrogen production.

• Project timeline and operational lifespan

Solar PV and hydropower projects differ significantly in terms of construction duration, capacity range and operational lifespan. The installation period for Solar PV projects having a capacity below 10 MW in Nepal spans from six months to one year but projects between 10 MW and 50 MW require one to two years to complete. The duration of operation for these projects extends to 25 years from the Power Purchase Agreement date according to existing legal provisions but lacks any provisions for further extensions. In contrast, the duration for constructing hydropower projects depends on project size along with design complexity. 

Construction practices in Nepal indicate that projects without tunneling under 20 MW require a two-year duration while projects with tunneling need 2.5 years for completion. Projects with capacities between 50 MW and 100 MW need between 3 and 4 years to build, yet larger installations that surpass 100 MW require five years to complete because they present additional construction challenges. Hydropower plants exist for 50 to 100 years when maintenance is carried out correctly. Private sector projects receive their first 35-year operating license from government authorities, which can extend the authorization for another 15 years. The comparison of solar and hydropower shows that solar delivers swift implementation while hydropower maintains enduring operational capabilities, thus both systems represent fundamental elements for Nepal’s developing energy sector.

• Production efficiency

The capacity factor of a power plant represents the ratio of actual energy output to its maximum potential. A higher capacity factor ensures stable and predictable electricity supply that supports uninterrupted operation of hydrogen electrolyzers. For comparison, a 1 MW solar PV system operating at 20 percent capacity factor would generate 1,752 MWh annually to produce 35,040 kg of hydrogen when electrolyzed at 70 percent efficiency. In contrast, a 1 MW hydroelectric plant with 50 percent capacity factor produces 4,380 MWh of annual energy output, which results in hydrogen production of 87,600 kilograms. This means that hydropower can produce approximately 2.5 times more hydrogen per MW than solar power. The large-scale production of hydrogen through hydro-based methods proves more efficient in Nepal because hydropower constitutes a major portion of its energy mix. Hydropower benefits from solar energy integration since it provides additional flexibility and strengthens the electricity supply system.

• CAPEX

Capital investment is a key factor in selecting a renewable energy pathway for hydrogen production. Solar power plant installations in Nepal cost between Rs 60m-Rs 70m per MW but hydropower construction requires approximately NPR 80m per MW before adding the cost of electrolyzer units. The price gap between hydroelectric and solar-based hydrogen production indicates that hydropower stands as a more economically efficient option for big projects across Nepal because it delivers extended operational time and dependable output. However, solar energy remains an attractive option for diversification and hybrid energy solutions.

• OPEX

For hydroelectric power plants, the annual operation and maintenance expenses amount ranges from one percent to 2.5 percent of initial capital investment to cover turbine maintenance alongside dam maintenance and sediment removal. In contrast, solar power plants incur an initial O&M cost of two percent of the capital cost in the first year and then increase annually by five percent of the initial two percent. The maintenance expenses include operations on the panels and inverters in addition to the monitoring system maintenance. The initial maintenance costs of solar power are lower, but future expenses will rise because regular servicing becomes essential to preserve operational efficiency.

Cost comparison of hydrogen production

The cost of hydrogen production varies significantly depending on the energy source and country-specific strategies. The government of Chile intends to achieve annual green hydrogen production of 160m tons by 2050 through its extensive hydropower resources. The National Green Hydrogen Strategy of Chile envisions that the country will achieve 5 GW electrolyzer capacity by 2025 and 25 GW by 2030 with the goal to lower production costs to $0.8–$1.1 per kilogram by the end of the decade. 

Meanwhile, the United Arab Emirates (UAE) uses its extensive solar resources to become a dominant global player in solar-powered hydrogen manufacturing. Through its renewable energy flagship Masdar, the UAE plans to grow hydrogen market share globally to 25 percent by 2030 and increase its annual production to 1m tons. The UAE has established a strategy to decrease production expenses for hydrogen to $1-$2 per kilogram by 2030. The evaluation demonstrates that hydro-based hydrogen production in Chile generates lower production expenses yet solar-powered hydrogen from the UAE establishes itself as a competitive and scalable option for international hydrogen markets.

Pathway to green hydrogen leadership

Nepal can establish itself as a regional leader in green hydrogen production through its extensive hydropower resources combined with solar power integration, which creates a strong and resilient energy combination. Hydropower provides an efficient and cost-effective production method for large-scale hydrogen generation because it delivers stable renewable energy, which supports long-term sustainability and energy security. The combination of solar energy with hydropower enables better power flexibility and decentralizes hydrogen producing operations. Strategic investments, policy support and international collaborations will be crucial in unlocking Nepal’s hydrogen potential thus positioning the country as a key player in the global green hydrogen economy.

Fagu, also known as Holi or Faguwa, is one of the most joyous and vibrant festivals celebrated in the Tarai Madhes region of Nepal. This festival, often referred to as the “festival of flying colors,” is a celebration of romance, unity, and the playful splashing of red powder and vibrant hues. While Holi is celebrated across Nepal and India, the traditions and customs in Tarai Madhes hold a unique charm and significance.

The festivities begin with the erection of the Chir (a ceremonial totem pole) in Kathmandu Durbar Square, a UNESCO World Heritage Site. This marks the official start of the celebrations. Revelers splash water and throw colored powders—yellow, blue, and red—on each other, creating a kaleidoscope of joy. Friends, relatives, and even unsuspecting passersby, including foreign visitors, are not spared from the colorful onslaught. The festival spans a week, but the most exuberant moments occur when people play with Abir (colored powders) and water mixed with vibrant dyes.

The Chir, a three-tiered structure, holds deep cultural and mythological significance. It is raised on the 8th day of the waxing moon near the Kumari Temple in Basantpur and remains standing until the final day of the festival. The Chir symbolizes the Kadam tree from Hindu mythology, where Lord Krishna is said to have hung the clothes of the Gopinis (milkmaids) while they bathed in the Yamuna River. According to legend, the Gopinis were startled by Krishna’s flute and, in their embarrassment, prayed to the sun god while submerged in water. The pieces of cloth on the Chir represent the garments of the Gopinis, adding a layer of spiritual meaning to the festivities.

The great poet of Mithila Vidyapati has described in one of his poems:

“Let us go and greet the Spring,

Where Ketaki and Kund bloom, laughing.

The moon shines clear, a silver glow,

While black bees hum, their whispers low.

The night is soft, a dim embrace,

Yet my beloved turns an angry face.

Kamadeva, the god of love, takes his stand,

Locked in battle, bow in hand.

Radha and Krishna, in playful delight,

Plan to escape to the forest at night.

Beneath the trees, where shadows play,

They’ll find their joy and steal away.”

In Tarai Madhes, Fagu is celebrated a day after the full moon night of the month of Falgun. On the full moon night, communities gather to burn heaps of garbage, symbolizing the cleansing of old energies. The following day, the air fills with the melodies of traditional Fagua folk songs as people roam their villages, exchanging colors, red powder, and small gifts like betel nuts, coconuts, cardamom, cloves, and raisins. The festival is a time for feasting, merriment, and strengthening social bonds.

Fagu is deeply intertwined with themes of love, fertility, and renewal. The full moon night is believed to enhance vitality and vigor, awakening romantic and amorous feelings among people of all ages. The festival is particularly significant for newly engaged and married couples, as it symbolizes the blossoming of love and passion. Non-vegetarian meals, including fish, meat, and eggs, are consumed to boost stamina, while vegetarian delicacies like sweets and fruits are also enjoyed. Home-brewed beer adds to the festive cheer.

The festival transcends social boundaries, bringing together people of all castes, genders, and backgrounds. It is a time to let go of past grievances and embrace love, affection, and unity. The throwing of red powder (kumkum or sindur) symbolizes equality and the breaking down of societal barriers.

Fagu also has deep mythological roots. It is associated with the divine love stories of Radha and Krishna, Rama and Sita, and Shiva and Parvati. The festival’s connection to fertility rites is evident in the playful and sometimes risqué folk songs and chants. According to Sanskrit scholars, the festival’s exuberant shouting and revelry may have origins in ancient fertility rituals, symbolizing the celebration of life and creation.

The festival also marks the arrival of spring, known as Basantotsav. As the poet P.B. Shelley famously wrote, "If winter comes, can spring be far behind?" Fagu embodies this spirit of renewal and hope. The lighting of bonfires during the festival symbolizes the triumph of good over evil and the ushering in of a new season.

One of the most enchanting aspects of Fagu is its music. The Holi or Fagua folk songs, steeped in mythological references, are melodious and deeply evocative. A popular folk song recounts the story of Lord Krishna’s flute, which charmed the world and connected the three realms:

"On the day Krishna played the flute,

The three worlds were connected.

What was the flute made of?

And how was it tied?

On the day Krishna charmed the world,

With bones and flesh, the flute was made,

With love, it was tied."

Fagu is not just a festival; it is a celebration of life, love, and cultural heritage. It is a time when the people of Tarai Madhes come together to rejoice, forgive, and renew their bonds. The festival’s vibrant colors, melodious songs, and rich traditions make it a truly unforgettable experience, shared not only by the people of Nepal but also by their neighbors in India, reflecting a shared cultural legacy.