Navigating Trump’s hardball policies

Since his inauguration on Jan 20, US President Donald Trump has issued more than 300 executive orders, significantly impacting both the United States and countries around the world. His orders on foreign aid, illegal immigration, environmental regulations, gender policies and abortion rights are expected to have direct repercussions for Nepal. In response, Nepal’s Ministry of Foreign Affairs has directed its embassy in Washington to closely monitor these developments and identify areas of concern.

Following Trump’s executive orders, the United States Agency for International Development (USAID) and the American Embassy in Kathmandu have paused all activities, including small-scale projects. Consequently, non-governmental organizations (NGOs) operating with USAID funding have been forced to suspend their work for the past three months, potentially affecting Nepal’s health, education and humanitarian sectors. However, the Nepal government has yet to issue an official response. Meanwhile, the US State Department is conducting a review of all foreign aid programs to ensure alignment with the administration’s “America First” policy.

In addition to foreign aid restrictions, the Trump administration has launched a nationwide immigration crackdown, leading to the arrest of over 1,000 individuals, according to Immigration and Customs Enforcement (ICE). These arrests include individuals without prior criminal records. White House Press Secretary Karoline Leavitt stated that while criminal offenders remain the top priority, all undocumented immigrants are subject to enforcement. Preliminary reports indicate that ICE has already detained some Nepali immigrants, including students working beyond their permitted hours.

According to ICE, approximately 1,400 Nepalis are residing illegally in the US and may face deportation. The Trump administration has reiterated that it is each country’s responsibility to repatriate its undocumented citizens. However, Nepali officials have remained silent on whether they have received a formal request from the US government regarding deportations. Some Nepali students are reportedly experiencing difficulties due to these new restrictions.

Despite reports of Nepali nationals being detained, Nepal’s embassy in Washington has not issued a statement. Meanwhile, US Ambassador to Nepal Dean R Thompson recently met with Foreign Minister Arzu Rana Deuba to discuss bilateral matters, though neither side has disclosed details of their conversation. A senior official at the Foreign Ministry stated that the government cannot publicly comment on US immigration policy, as it is their internal matter. However, Nepal’s agencies should take steps to support affected citizens.

Regarding US aid, USAID has halted its programs, though the implications for the Millennium Challenge Corporation (MCC) remain uncertain. While MCC is not directly tied to USAID, its activities may also be affected. However, given bipartisan support for the MCC, the initiative is expected to continue. Nepal and the US signed the MCC compact in 2017 during Trump’s first term. Additionally, Trump’s decision to withdraw from the Paris Climate Agreement could have some impact on Nepal. The administration, however, has stated its commitment to “sensible environmental protections” while prioritizing national interests.

A senior official at the Ministry of Finance commented: “Although Nepal may not face a direct cut in US aid, certain projects that do not align with Trump’s policies could be discontinued.” The official clarified that a temporary pause in assistance does not necessarily indicate an overall reduction in US support. Observers suggest that Nepal should engage in diplomatic negotiations to ensure continued US support, particularly for critical sectors.

The Trump administration is still in the process of making key appointments at the State Department, following the dismissal of numerous senior officials appointed by the Biden administration. The administration is expected to introduce new policies, including an aggressive stance toward China and further developments in the Indo-Pacific Strategy (IPS). Nepali policymakers must remain vigilant and adaptable to these changes. Some officials suggest that dealing with Trump’s administration could be more challenging than engaging with Biden’s.

Under the Biden administration, US assistance and investment in Nepal increased significantly, with high-level engagements and diplomatic visits. Nepal now faces the challenge of maintaining this momentum through negotiations with the Trump administration, given its need for continued support. Over the past four years, US-Nepal relations have strengthened through extensive diplomatic efforts, including the implementation of the MCC project, a priority for the Biden administration.

The Trump administration also engaged with Nepal during its previous tenure. In 2018, then-Foreign Minister Pradeep Gyawali visited the US for bilateral discussions—the first such visit in years. However, the visit sparked controversy in Nepal when the US State Department suggested that Nepal could play a central role in the Indo-Pacific region. More recently, in 2023, Foreign Minister NP Saud paid an official visit to the US to discuss a broad range of bilateral issues.