US advised Nepal to think of our payback capacity

American officials advised that Nepal should think of its pay-back capacity on development projects (Photo: Pritam Chhetri)

Minister for Foreign Affairs Pradeep Kumar Gyawali has come under flak for his recent US visit. At the center of the controversy was a statement from the US State Department which says the US wants Nepal to play a “central role” in the “Indo-Pacific” region. Some say Nepal should not be a part of the Indo-Pacific strategy, which is aimed largely at checking China’s military rise in the region. In this interview with Biswas Baral and Kamal Dev Bhattarai, the foreign minister says Nepal never acceded to be a part of any such strategy. He also pointed out the foreign policy priorities of Oli government.

What are the foreign policy priorities of Oli government?

The overarching motto of this government is: “Prosperous Nepal, Happy Nepali”. Our foreign policy is aimed at achieving this goal. Broadly, we are working on four areas: immediate neighbors, development partners, labor destinations and regional multilateral organizations. We attach highest importance to our neighbors and our focus with them has always been economic development. I am trying to enhance mutual trust and promote cooperation with our neighbors, in line with our national priorities. At the same time, our engagement with other key development partners has increased. Of late, our role in international arena has been more active, visible and productive.

Recently there seems to be an emphasis on expanding our foreign relations beyond our two giant neighbors.

We have embarked on a journey of stability and economic development. Our journey to prosperity has garnered global attention. To benefit from this, we are going to organize an international investment summit in March. When I meet my counterparts abroad at bilateral and multilateral forums, I convey the message that we want economic prosperity. I request them to support our tourism, and provide preferential facilities to our goods and services. Political stability is our major attraction.

Your recent US visit drew a lot of attention. Many were critical of Nepal’s closer embrace of the US.

Nepal adheres to the principles of non-alignment, Panchasheel and world peace. Guided by this spirit, we attach high importance to our relations with all countries. The spirit of ‘amity with all and enmity with none’ guides all our external relations. At the center of our foreign engagement is economic diplomacy. Global powers have their own ambitions, and regional powers have their own agenda. Nepal engages with all based on its domestic priority and necessity. We won’t be involved in any activity that is against our basic foreign policy principles or that impinge on genuine concerns of our neighbors. Perhaps due to the long transition there is a tendency in Nepal to be overly suspicious.

Your American counterpart, Mike Pompeo, projected Nepal as a central part of the US’s ‘Indo-Pacific Strategy’? Is that a right characterization?

Let me correct you. America has never said Nepal would be a central part of Indo-Pacific Strategy. They only talked about our pivotal role in this region. Nepal is current Chair of SAARC and immediate past chair of BIMSTEC. In this light, America may have expected greater role and visibility of Nepal in this region. I have made it clear that we do not have any global ambition. Our only ambition is economic development and prosperity. We want to graduate from LDC at the earliest and be a middle-income country by 2030. To meet those objectives, we need more investment. In bilateral meetings, it is natural that we put forward our expectations and they put forward their own. Ultimately, it is up to us to take or reject their offers based on our necessity and requirement.

Of late the geopolitical competition in Nepal between India, the US and China seems to have intensified. How do you balance those powers?  

We never compare our relation with one country with another. Each relation is unique. Our relation with India is age-old. There is high people-to-people contact, of which the open border is the perfect symbol. We also have historical relations with China and it continues to support Nepal’s goals and aspirations. China is the second-biggest economy in the world and we want to connect with China for our economic development. Our engagement with China will further increases as a transit country. America is supporting our development projects and various areas of social development. It has been doing so since 1950s.

There is competition as well as engagement among big powers. We should not think there is only competition.  Of late, there is growing engagement between India and China. There is trade dispute between America and other countries and there are tensions but there is also dialogue. We are closely analyzing those developments.

In your bilateral discussions in the US, what were the Americans mostly interested in?

First, they appreciated Nepal’s role in this region. They also expected Nepal to play an even bigger role. As an active participant of SAARC, BIMSTEC and other regional organizations, America perceives Nepal as a leader of this region. Second, the peace process in the Korean peninsula is gaining momentum. My counterpart was optimistic on this. America is of the view that countries should have a common position on UN Security Council proposal on North Korea. I clearly said that Nepal is in favor of denuclearization in the Korean peninsula and that Nepal wishes for the success of the ongoing peace dialogue.

Third, America officials wanted Nepal to give more attention to fair business and competitiveness when development projects are selected. Similarly, American officials advised that Nepal should think of its pay-back capacity on development projects. I clearly said that Nepal needs resources. We made it clear that we want investment and we want loan. But Nepal would also try to make terms and conditions favorable on development aid. I also requested American companies to invest in Nepal.

Some say the Americans wanted Nepal to crack down on North Korean activities on Nepali soil.
No such issues were discussed. As far as UN resolution on North Korea is concerned, Nepal supports it.

What is the status of relation with India?

We are satisfied with progress in Nepal-India relation. Our main concerns were development projects and there has been progress. Of late, India has amended its power guidelines, paving the way for greater energy cooperation. Now we can use Indian grid to supply electricity to third countries. The progress on inland waterways is also encouraging. Our produce are gradually getting access to Indian markets. Our bilateral mechanisms are regularly holding their meetings. There are commitments on both sides.

What then explains India’s refusal to accept the EPG report?

The EPG was formed at the initiation of two prime ministers. We are happy that there is an understanding on both sides on contentious issues. It is big achievement. I do not doubt the commitment of political leadership on EPG. But there are some spoilers in Nepal-India relations. The implementation of EPG could hamper their interest, and hence the delay.  

What about our relation with China? There is no progress on the BRI.

We have identified some projects under the BRI and shared them with China. Some implementation mechanisms on BRI projects have also been established. We are now finalizing detailed reports and funding modalities of around a dozen projects under the BRI.