China’s new strategy in Nepal: Engagement without endorsement

It has been three weeks since the formation of the interim government led by Sushila Karki, who was appointed by President Ramchandra Poudel with a mandate to hold elections within six months. The Karki-led Cabinet has already announced that the elections for the House of Representatives (HoR) will be held on March 5.

Since taking office, Karki and her ministers have been actively engaging with major international powers. Countries including India, the United States, China, the European Union, and Japan have extended congratulations to the new government and held diplomatic meetings with its leadership.

On Sept 12, a Chinese Foreign Ministry spokesperson, responding to a media question, offered a formal congratulatory message: “China and Nepal share a time-honored friendship. China, as always, respects the development path chosen independently by the people of Nepal. We stand ready to work with Nepal to promote the five principles of peaceful coexistence, enhance exchanges and cooperation in various fields, and further advance bilateral relations.”

Six days later, on Sept 18, Chinese Ambassador to Nepal Chen Song met with Prime Minister Karki to formally extend congratulations and reaffirm bilateral cooperation. "We exchanged views and agreed to further promote our friendship and cooperation," Chen noted following the meeting. During this period, the Chinese Ambassador also held discussions with several ministers, focusing on ongoing Chinese projects in Nepal.

Despite these engagements, a notable absence remains: there has been no public congratulatory message from either the Chinese President or Prime Minister. This marks a departure from precedent. For example, in both 2018 and 2024, when KP Sharma Oli became Prime Minister, China’s top leadership extended congratulations within days. Similarly, after Pushpa Kamal Dahal’s appointment on 25 Dec 2022, then Chinese Premier Li Keqiang sent his message by Dec 29.

The muted response has sparked speculation among political observers in Kathmandu. Analysts suggest Beijing may be unsettled by the new political landscape that emerged from the recent GenZ protests—an unexpected movement that sidelined many traditional power brokers, including Nepal’s left-leaning parties that China has historically favored.

Over over a decade, China has primarily relied on Nepal’s communist parties to secure its strategic interests, particularly in matters of regional security. In recent years, however, relations between China and the Nepali Congress had also improved—culminating in the signing of the Belt and Road Initiative (BRI) framework agreement last year, despite previously strained ties.

However, the GenZ movement has disrupted the traditional political order. According to China watchers in Kathmandu, Beijing is now grappling with two main concerns: Political instability–a volatile Nepal could undermine Chinese interests and security in the region, and Western influence–increased engagement by Western countries with the new government may be viewed as a challenge to China's strategic foothold.

Further complicating the picture is an unusual congratulatory message from the Dalai Lama to Karki on Sept 13—an exceedingly rare gesture that may have further displeased Beijing. Adding to the speculation, Chinese state media has largely remained silent. Apart from brief news reports by Xinhua and China Daily, there has been no commentary, editorials, or opinion pieces—typically a key indicator of the Chinese government’s sentiment on foreign developments.

According to regional analysts, China’s approach to new governments in Nepal typically follows two tracks. If Nepal’s leadership is perceived as favorable—usually under communist parties—Beijing sees it as an opportunity to expand influence. For instance, erstwhile government led by KP Sharma Oli extensively engaged with China. The two notable developments with China were the signing of the BRI framework agreement and Prime Minister Oli’s participation in the Victory Day parade, which helped appeased Beijing. But, soon after his return from Beijing, Oli’s government collapsed.

If the regime is seen as less aligned, China focuses on safeguarding its core interests through cautious engagement while avoiding overt displays of dissatisfaction. So far, China appears to be choosing the latter path with the Karki-led interim government—engaging pragmatically. According to experts, China may support holding the elections as soon as possible, as it would bring political parties to power.