Analysing Chinese Encroachments into Nepal

In a leaked Nepalese government report, Kathmandu has accused Beijing of encroaching into its territory along the border of the two countries. While the Chinese embassy in Kathmandu has denied these allegations, Beijing’s actions seem to be driven by its new Border Security Law that was passed in 2021. This incident offers an opportunity to objectively assess the China-Nepal bilateral relationship, which has otherwise been witnessing an uptick in the last few years in terms of economic and vaccine aid to Kathmandu by Beijing, and the expansion of China’s Belt & Road Initiative (BRI) to Nepal. While the incident may not lead to a change in Nepal’s outlook and engagement with China, it certainly exposes certain cracks in their bilateral relationship. Moreover, with a recent downward spiral in India-Nepal relations due to outstanding border disputes, this incident offers New Delhi an opportunity to rethink its policy and outreach towards Kathmandu, given the latter’s growing proximity to Beijing and solidifying its border security.

China and Nepal: A History


The relationship between China and Nepal has evolved over time. Going back to the 1950s, Nepal had been conscious of the Communist takeover of China in 1949 and subsequently of Tibet in 1950. At that time, Nepal’s key worry regarding the Communist China was through the lens of security – Tibet, a region now under the control of Beijing, shared a direct border with Nepal and the two had previously shared a complex relationship having indulged in trade, but, at the same time, had fought multiple wars.


However, Nepal intimated India of wanting to establish diplomatic relations with China in 1955 and in the same year, established formal diplomatic relations with the People’s Republic of China. Nepal’s steady relationship with India during that period stemmed from deep historical, cultural, and economic ties. For Kathmandu, being sandwiched between two giant neighbours like India and China may have been a daunting concern then, leading it to seek closer relations with China as well in the pursuance of a more pragmatic foreign policy approach.


The Chinese view of Nepal until its Tibetan invasion in 1959 was also limited and narrow. Beijing had adopted a minimum-interference policy towards Nepal with the sole purpose of securing Tibet. However, after the invasion and the Dalai Lama’s escape to India, Beijing started to view Nepal as a serious border security concern and for its proximity to and ties with India. It started to seek better relations with Nepal and inked various economic agreements with Kathmandu. Similarly, it also started providing political support to Nepal to seek a more ‘independent’ approach vis-à-vis its foreign policy. Kathmandu’s want for enhancing its trade also helped the Chinese overtures.


Naturally, China also sought concessions from Nepal in return for its economic and political aid – case in point the quelling of the Chushi Gangdruk’s Tibetan Resistance in 1974 by Kathmandu at the behest of Beijing. Further, in 1988, China sold military equipment to Nepal on the latter’s insistence. The fact that Nepal shared a complex relationship with India – Kathmandu and New Delhi’s outstanding border disputes, India’s economic countermeasures against Nepal in 1989, and Nepalese fears of interference by India – paved the way for deeper China-Nepal ties over time as China exploited the gaps left by India in its Nepal policy. Steadily, China was able to establish its footprint in Nepalese politics and economy.


Chinese Encroachments into Nepal Through the Prism of Border Security Law: Assessing the Impact


As Xi Jinping assumed power over CCP (Chinese Communist Party) and China in 2012, Beijing undertook a more nuanced approach in dealing with Nepal. Two major conferences at that time – Conference on Diplomatic Work with Neighboring Countries 2013, and Central Conference on Work related to Foreign Affairs, 2014 – laid the groundwork for Beijing focusing on its peripheries to create a closer diplomatic synergy with neighboring countries and utilizing the same to realize China’s centenary goals for 2021 and 2049.


Now with the recent Border Security Law passed by Beijing in 2021, China aims to secure China’s borders on its own terms by making the Chinese People’s Liberation Army (PLA) and People’s Armed Police (PAP) responsible for border security, and implementing a civil-military fusion concept that involves the usage of locals in border areas for information collection and supporting the PLA’s and PAP’s security activities. Thus, the new border law seems to be an extension of the two conferences held in 2013 and 2014.


In this regard, China’s approach towards Nepal will primarily be from a security perspective aimed at securing Tibet’s peripheries. Tibet being the most sensitive issue for it, China has been exercising stronger control over Lhasa over the years through heavy surveillance and suppression of religious, cultural, language, educational and human rights aspects of Tibet in an apparent attempt at its Sinicization.


Nepal currently hosts around 20,000 Tibetan refugees on its soil. In the past, Nepal has served as an escape route for many Tibetans fleeing the repressive policies of China. Naturally, China has always been on the lookout to prevent this outflow by exercising stronger border control in Tibet and ensuring the blockade of escape routes to Nepal. As per reports, the movement of Tibetans to Nepal has been heavily restricted by China since 2008 in the aftermath of anti-China protests during the Beijing Olympics in a joint effort with Kathmandu.


But the leaked report about Kathmandu accusing Beijing of encroaching into Nepal’s land might expose the cracks between the countries’ bilateral relationship. First, it is curious that the Nepalese government has not published this report yet. Does it reflect Nepal’s fears of angering China in case it confronts the latter on the issue? Or is there any backend deal that China has made with Nepal to keep this information under wraps? While we may not have answers to these questions right now, it does bring out the seriousness of the border disputes between the two nations and its capability to drive a further wedge in their bilateral relationship by raising Nepal’s suspicions about Chinese intentions, especially the security front.


Second, it will complicate China-Nepal synergy on Tibet. The encroachments reflect Beijing’s paranoia over its Sinicization plans for Tibet, which involves the suppression of Tibetan Buddhism and establishing an ‘atheist’ and a ‘homogeneous’ identity. The leaked report mentions the containment of religious activities by China through surveillance on the Nepalese border in a place called Lalungjong. The area draws a large number of Hindu and Buddhist pilgrims visiting Mt. Kailash, which is in proximity to the area and lies in Tibet. Additionally, China might also be growing more paranoid over controlling the outflow of Tibetans to Nepal, thus leading it to encroach on Nepalese land. Even though Nepal has been firm on its One China Policy (including Tibet), these two dynamics may flare up further border disputes between the two and Nepal viewing Chinese tactics in Tibet as a threat to its own security.


Despite these cracks in their relationship, it seems unlikely that Nepal would take a confrontationist approach towards China. At a time when Nepal has been involved in a border dispute with India since 2020, Kathmandu will find it difficult to manage another border dispute with Beijing simultaneously and will try its best to avoid it. This is evident from the Nepalese government’s statement on the leaked report – “Kathmandu would study the matter and bring out an official statement thereafter” and that it is “ready to solve those (border issues) through diplomatic ways”, referring to China and India both. It is also unlikely that it will affect the bilateral economic relationship that the two share. Nepal will not be open to push back on the Chinese investments under BRI and the vaccine aid, especially at a time when its relationship with India has been rocky due to border disputes.


Rethinking India’s Nepal Policy


The Chinese encroachments into Nepal have indeed highlighted the flawed relationship that the two share and thus, offer India an opportunity to rethink its Nepal policy. As New Delhi continues to be embroiled in a border standoff with China at the Line of Actual Control (LAC), it should certainly be wary of Beijing’s actions on the Nepalese borders that may pose national security risks to both Kathmandu and New Delhi. A secure Nepal is in the interest of India’s national security.


While India and Nepal share a deep historical relationship spanning decades, border disputes and Kathmandu’s suspicions over New Delhi’s involvement in their affairs have contributed in making the relationship a complex one. Moreover, Nepal’s dilemma in balancing its relationship with both India and China adds another layer of complexity.


However, it is only prudent that India should now adopt a more realist and pragmatic approach in dealing with Nepal. With Nepal’s trust in China currently floating in turbulent waters, New Delhi should initiate dialogue with Kathmandu to resolve the outstanding border disputes. Such an overture will be seen as a huge goodwill gesture by Nepal, eliminate Kathmandu’s suspicions over New Delhi’s intentions, and reaffirm India’s commitment to it as a trustworthy friend.


Furthermore, India should endeavor to strengthen Nepal’s involvement in the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC). The telephone exchange between India and Nepal’s foreign ministers in January 2022, BIMSTEC’s General Secretary’s meetings with the Nepalese PM and President in January 2022, and the recent MoU between the countries to build a bridge across the Mahakali river in Darchula offer a solid base for such an endeavor. BIMSTEC offers a lot of room for India and Nepal to strengthen their relationship – better linkages on the Buddhist Tourism Circuit, people-to-people exchanges, and energy cooperation on hydropower are the three options that can be explored. This will also lead to stronger regional connectivity for both India and Nepal, while also providing an economic impetus to Kathmandu. Additionally, it can also serve as a counter for Nepal to escape Chinese debt-traps under BRI, which are not unknown, and offer it better economic opportunities at the behest of India.


The Chinese encroachments should thus offer perspective to both India and Nepal in conducting their foreign policy responsibly. While it offers India a way to mend it relationship with a key neighbor and counter the growing Chinese challenge in its vicinity, Nepal should tread carefully in undertaking its balancing act between New Delhi and Beijing. This will come with its own set of challenges, but being able to set aside differences and talk, will be a key for both India and Nepal to cater to their respective national interests while strengthening their bilateral relationship.




(Bhavdeep Modi is currently serving as a Senior Research Associate at Organisation for Research on China and Asia (ORCA), a New-Delhi based think-tank, where he focuses on India-China relations against the backdrop of the Indo-Pacific construct, while also looking at India’s neighborhood policy and the rise of middle powers in Asia.)

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