Chinese Connection

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Chinese Connection

The recently concluded China visit of Prime Minister KP Oli received a lot of publicity both within Nepal and in India. The Nepali people were told that the visit was a resounding success. Some say it ‘ended Indian monopoly on Nepal’s transit trade’ and others point out that by agreeing to explore mineral fuels in Nepal, China has started to help Nepal end its dependence on India for such fuel. And similar points were raised also in India and it seems the general people in India, too, think Nepal is slipping out of the Indian camp and falling into the Chinese embrace. 

But under closer scrutiny, it can be concluded easily that both Nepali hopes and Indian fears are unfounded. In fact, China has maneuvered itself in such a clever way in that it has provided enough publicity material for Oli to wave before the Nepali people while safeguarding its own greater interests that are fulfilled if India is not made unhappy. 

Take the transit treaty. This is not a great achievement for a number of reasons. First, as a landlocked country bordering China, Nepal has the right from international conventions to get a transit facility also from China. In other words, China would not have refused this treaty if Nepal had just sent an official letter through official channels. The prime minister himself would not have needed to travel all the way to Beijing. Second, despite this treaty in place now, Nepal will not be in a position to use this for several years (for example, till the Chinese railway reaches Nepal’s border and the roads on Nepal’s side are ready to meet the Chinese railway head). 

It’s a similar case with the promise to explore petroleum mining in Nepal. Though Nepal does have good prospects for petroleum, coal and natural gas mining, the possibility of actually extracting them are remote, primarily because such mining will require either the displacement of huge populations or clearing big areas of forested land. 

Had the prime minister been able to get something concrete from his trip to China, for example to actually open the Tatopani-Khasa border point or the construction of a special economic zone at Panchkhal or other locations near the Chinese border, then that would have made a real immediate impact on the Nepali economy and would have really deserved big applause. But the Chinese have cleverly avoided this. It seems, the Chinese are, for the time being at least, satisfied with the Karakoram Highway that connects China with Pakistan and Gwadar Port at the Arabian Sea in Pakistan. That is a much shorter route for them to reach the Arabian Gulf. For the Indian market they will rather focus on direct China-India connections through, say, Lipu Lek in the west of Nepal and Nathu-La in India’s Sikkim. Chinese insistence that Nepal should focus on upgrading the road to Keyrong and forget Tatopani means they will not deny Nepali requests outright but will wait for Indian signals before making any concrete commitments. Even if Nepal upgrades the road to Keyrong working on a war-footing, it will take 3-5 years to complete. 

The joint communiqué issued at the end of Oli’s China visit is full of verbiage but empty in essence. The Chinese government has promised all that Nepal wants, but before China actually implements its commitments there are so many conditions that Nepal has to fulfill. And it will naturally take years for Nepal to do that even if it does work with high priority. 

In short, there is nothing that the business community or the general people of Nepal can expect of immediate (or even medium term) benefit from this visit. 

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