On 24 February 2020, the then Foreign Affairs Minister Pradeep Kumar Gyawali met with his Latvian counterpart Edgars Rinkēvičs in Geneva, Switzerland, on the sidelines of the 43rd session of the United Nations Human Rights Council, to discuss the political and economic relations between Nepal and Latvia, cooperation in international forums and relations between the European Union and Nepal. This was the first official meeting between the ministers of Nepal and Latvia and has been hailed as a cornerstone to promote the diplomatic ties between the two nations.
"To strengthen the bilateral relations Artis Bertulis, residing Latvian Ambassador to Nepal in India, has visited in Nepal for the first time in October," sayes Karan Vaidya, honorary consul general of Latvia to Nepal.
In the past, the Consulate of Latvia in Kathmandu had also organised the visit of the former Latvian ambassador to Nepal Aivars Groza.
Nepal's embassy in Copenhagen, Denmark, is also accredited to Latvia and the Latvian embassy in New Delhi is accredited to Nepal. Latvia maintains a consulate in Nepal headed by Karan Vaidya, vice-president of Vaidya Group, who was appointed as the Honorary Consul in 2017; his appointment is the youngest of an Honorary Consul in the world to date. Since then, he has been working to bring the two countries together in terms of various areas of mutual interest.
Nepal established diplomatic relations with Latvia on April 20, 1992 after the Baltic country freed itself from the clutches of communism in 1991. Parliamentary democracy had also been restored in the Himalayan nation in 1990. A European Union country since 2004, Latvia is a member of the Organisation for Economic Cooperation and Development (OECD), a group of 38 advanced economies of the world.
Vaidya says that formal diplomatic ties between Nepal and Latvia is not only about trade but also works as a platform for the citizens of both countries. "This formal relationship has helped citizens from both countries explore each other’s nations for various purposes. For instance, several Nepali students are pursuing their post-doctorate programmes at renowned universities in Latvia. We have a recurrent number of Nepali students who go to study in Latvia and the Honorary Consulate has been encouraging Nepalis to travel to Latvia as well," he says, adding, "Similarly, we have had several mountaineering enthusiasts visiting Nepal annually from the EU country."
Despite being a young liberal economy, Latvia is an exemplary state in the current world economy. Its recovery from the economic recession has been outstanding. Known as the 'Baltic Tiger' for its high economic growth from 2004 to 2007, the country was hit hard by the 2008 global financial crisis. However, the country showed its strength when it recovered in 2011 to become the EU’s strongest economic reviver by late 2012. Latvia is also ahead in lowering the impacts of the deep economic downturn caused by the Covid-19 pandemic. The country has been hailed for its “green economic recovery” plans that include 'climate mitigation measures', 'cross-cutting measures', and measures related to ecosystem services, biodiversity, land use and agriculture.
"Latvia has rich experience and knowledge in sectors such as hydropower, information technology and agriculture. The country can share the expertise and knowledge, creating a mutually beneficial bilateral relationship with developing nations like Nepal," opines Vaidya.
In spite of the three-decades-old bilateral relations, trade between Nepal and Latvia is yet to get any meaningful direction. The data published by the Trade and Export Promotion Center clearly shows that the trade volume has remained negligible over the years. In 2019, Nepal's exports to Latvia amounted to USD 59,580 and imports from the Baltic nation totaled USD 246,740; this figure was USD 153,131 and USD 406,685, respectively, in 2018. Nepal's main exports to Latvia include carpets, pashmina, artworks, essential oils and leather while the country imports items like broadcasting equipment, machinery, medical apparatus, toys, and beverages and spirits, among a few other items.
Vaidya thinks that it is not easy to increase trade between two countries that are not well connected through trade routes and are relatively smaller in terms of size and population. "Nevertheless, with the advent of technology, these hurdles are getting smaller and we have been identifying products from both countries that have the potential for trade," he says. According to him, the Honorary Consulate has looked for mutually beneficial sectors and has found hydropower operations and management, IT and agriculture as the most potent sectors. "Latvia is by far the most successful Baltic nation in terms of harnessing hydropower resources. The country has vast experience in the energy sector and a highly successful record of accomplishment," mentions Vaidya. He says that Latvia is known to have one of the best internet infrastructures and is one of the fastest internet service provider countries in the world. "We see a potential for information technology knowledge and infrastructure transfer from Latvia to Nepal and have therefore been promoting this sector," adds Vaidya.
Similarly, he also observes big potential in agribusiness cooperation and says that Latvian agriculture-based companies can bring their expertise to increase the productivity of land in Nepal, yielding to higher output, fuelling the domestic demand and reducing dependence on neighbouring imports. "Subsequently, with the rising agriculture industry, the requirement for supplements such as fertilisers has become a necessity," he says, adding, "The largest export from Latvia to India are mineral/chemical fertilisers."
There are other areas such as tourism that have a lot of potential for cooperation between Nepal and Latvia. Before the pandemic, some 300 Latvians use to visit Nepal annually. While this number may seem very small compared to other tourist source countries, Vaidya thinks that for a country like Latvia which has a 1.9 million population, this can be considered as a good start. "Latvians have a strong affinity towards Nepali mountains and spirituality. Most Latvian travellers I have met love Nepal, especially our people and hospitality, and always want to come back," he says. He expresses that after the pandemic is over, there will be an increase in the inflow of Latvian tourists in Nepal and the Honorary Consulate will continue to promote tourism with the help of the Nepal Tourism Board.
Similarly, there has been a lot of interest from the Nepali private sector and Vaidya and his office has assisted several business representatives to visit Latvia in order to assess the market and initiate trade.
According to Vaidya, regardless of the distance between the two countries, it is critical to have a strong diplomatic bridge to foster a good environment for economic cooperation.
Besides promoting economic ties between the Himalayan nation and the Baltic country, Latvia's Honorary Consulate in Nepal is also active in other activities. During the recent lockdown, there were more than 20 Latvians stranded in Nepal trying to go back home.
"If there were no Latvian envoy here, their repatriation would have been very difficult. With the help of the government and the EU Delegation, we were able to repatriate every individual who chose to leave," informs Vaidya. "When circumstances like these arise, in a globalised world where everyone is everywhere, it is a strength to have diplomatic ties with as many countries as we can."
Vaidya is the youngest member of the Honorary Consul Corps-Nepal (HCC-N), a forum of Nepali business persons representing different countries in Nepal as honorary consuls and consul generals. He says that he has been learning a lot from the organisation and has understood its importance.