Nepal’s Prime Minister breaks diplomatic convention and chooses China as his first overseas visit

Nepal’s Prime Minister breaks diplomatic convention and chooses China as his first overseas visit

Click to enlarge the image. Nepalese Prime Minister Sarma Oli. Photo = Reuters
Nepal’s Prime Minister KP Sharma Oli is scheduled to make an official visit to China from December 2 to 6. Nikkei reported on the 26th (local time) that this is a decision that breaks Nepal’s diplomatic practice of choosing India as its first overseas visit, and is evaluated as signaling a change in the Himalayan country’s foreign policy.

The core agenda of this visit is economic cooperation. Prime Minister Oli reportedly plans to request exemption from $216 million in construction funds for the Pokhara International Airport loaned by the Export-Import Bank of China. This airport, which opened in January 2023, has not yet attracted a single international flight.

Particular attention is being paid to negotiations related to China’s Belt and Road Initiative (BRI). Nepal joined the BRI in 2017, but there are currently differences of opinion between Prime Minister Oli’s Nepal Communist Party (Unified Marxism-Leninism) and its coalition partner, the Nepal Congress (NC), on how to pursue the project.

An official from the Central Committee of the Nepal Communist Party predicted, “If the Nepalese parliament does not agree with BRI’s financial method, it may be difficult to pursue an agreement.” On the other hand, experts on China-Nepal relations analyze that the NC’s opposition was a reaction to China’s initial aggressive strategy, and that the situation may change as China recently adjusts its approach.

Prime Minister Oli had signed trade and transport agreements with China during his previous term to reduce dependence on India. Experts interpret his visit to China as an intention to continue this policy trend.

Meanwhile, relations with India are somewhat uneasy. Even though Prime Minister Oli has officially invited Indian Prime Minister Narendra Modi twice, New Delhi is showing a passive attitude. In particular, the relationship between the two countries deteriorated after Nepal included the disputed territory with India on its map in 2021.

Nepalese political circles are emphasizing the need for balanced diplomacy with neighboring powers. A ruling party official argued, “Nepal should avoid forming excessive alliances or hostile relationships with either India or China.”

Ahead of Prime Minister Oli’s visit to China, local media is advising that national interests should be considered top priority. A columnist for the Kathmandu Post said, “This visit is more than a simple break with diplomatic conventions, and could be the starting point for a new approach.” “It shouldn’t become something,” he emphasized.

This visit shows that Nepal’s foreign policy is reaching a turning point. Nepal’s delicate diplomatic stance, which seeks to strengthen economic cooperation with China while also seeking to improve relations with India, is attracting attention.

Nepal’s strengthening of access to China presents both new opportunities and challenges to the Korean economy. As Nepal, which has traditionally pursued an India-centered foreign policy, expands economic cooperation with China, it is expected that new opportunities for Korean companies to advance into the country will open up.

An official from the Korea International Trade Association analyzed, “The possibility of Korean companies participating in infrastructure development and energy projects promoted by Nepal is increasing,” and added, “In particular, Korea’s airport operation know-how will be able to be utilized in the process of normalizing the operation of Pokhara International Airport.”

What is noteworthy is that Nepal, while participating in China’s Belt and Road project, is taking a cautious approach considering its relationship with India. An official from the Korea Institute for International Economic Policy explained, “This can be a model of balanced diplomacy that Korea can adopt amidst the conflict between the United States and China.”

Nepal’s approach to China also requires changes in Korean companies’ strategies for entering the South Asian market. An official in the construction industry predicted, “There is a need to reexamine the strategy of entering Nepal based on India,” and added, “Strengthening economic cooperation between China and Nepal will provide new business opportunities.”

In particular, it is assessed that there is great potential for cooperation in the fields of new and renewable energy and digital infrastructure. The Korea Institute for Industrial Economics and Trade analyzed that “opportunities to apply Korea’s technology to Nepal’s hydroelectric power generation and communication network modernization projects will increase.”

However, experts also emphasize the importance of risk management. An official at the Export-Import Bank of Korea advised, “We need an entry strategy that takes into account Nepal’s political instability and the conflict between India and China,” and added, “It is important to approach the market from a long-term perspective.”

The government also plans to strengthen support for entering the Nepalese market. An official from the Ministry of Trade, Industry and Energy said, “We plan to form a working-level consultative body to strengthen economic cooperation between Korea and Nepal and expand financial support for companies to enter the local market.”

Meanwhile, the small and medium-sized business community is paying attention to the growth potential of the Nepalese market. The Korea Federation of Small and Medium Businesses evaluated, “As demand for infrastructure development in Nepal increases, opportunities for small and medium-sized businesses to target niche markets will also expand.”

In the end, Nepal’s approach to China may be a new opportunity for Korean companies, but experts agree that a strategic approach is needed that takes into account the complex dynamics between India and China. In particular, there is a need to establish an entry strategy that utilizes Korea’s technology and experience in the areas of infrastructure, energy, and digital transformation.

Global Economics Reporter Park Jeong-han [email protected]

**What ⁣are⁢ the potential ‌long-term economic ⁤consequences ⁣for Nepal ⁤of pursuing closer economic ties⁢ with China, ​especially considering ​its existing dependence ⁣on India?**

## World Today News: Nepal’s Shifting Sands – A Look at the ‌Impact of Oli’s China​ Visit

**Introduction:**

Welcome to World Today News. Today ‌we’re diving deep into Nepal’s foreign policy shift, sparked by Prime Minister Oli’s upcoming visit to China. Joining us are two esteemed guests: Dr. Sharma, a leading expert on Nepal-India relations, and Mr. ‌Li, a specialist in China’s Belt and Road Initiative ⁤and‍ its ‍impact on South ‌Asia.

**Section 1:‌ Diplomatic Realignment – Breaking Conventions:**

* ‌**Host:** Dr. ⁣Sharma, Nepal traditionally ‌prioritizes India in its foreign policy. ​What‌ does Prime Minister Oli’s choice ‌of China for his ⁢first overseas ​visit signify? Is⁣ this a temporary shift or a wider repositioning‍ of Nepal’s strategic alignment?

* **Follow-up:** Mr. Li, from⁣ China’s perspective, ⁣how significant is this visit,​ especially considering Nepal’s previous hesitance towards the Belt and Road Initiative?

* ​**Open Discussion:** What ⁣are⁢ the ⁤potential benefits and risks for‍ Nepal in pursuing closer economic ties with China while maintaining its relationship⁤ with India?

**Section 2: ⁣Economic Strategies ‍- Seeking Opportunities:**

* **Host:** Nepal is facing economic hurdles, and the Pokhara International Airport exemplifies this challenge. ​ How effective do you think ⁢Prime⁣ Minister​ Oli’s request for debt ⁤relief from China will be, and how might this impact future⁤ infrastructure projects?

* **Follow-up:** Mr. Li, what role ⁤do‌ you see China playing in Nepal’s economic development,‌ and could this potentially lead​ to a dependency​ on China? Dr. Sharma, how ⁢would you compare this to Nepal’s relationship ‌with India in terms of economic support and investments?

*⁣ **Open Discussion:**​ What opportunities and challenges does Nepal’s burgeoning​ relationship with China present for international players, particularly South Korean businesses?

**Section 3: Balancing‌ Act ​- Navigating Two Giants:**

* **Host:** Nepal finds itself balancing⁤ its relationship with ⁤both India and China. How sustainable is this delicate equilibrium? Mr. Li, does China encourage Nepal to maintain its distance from India, or ‌does it promote​ a more balanced ⁢approach?

* **Follow Up:** Dr.‌ Sharma, what ⁣are the potential triggers that could destabilize this precarious ⁢balance, and ⁢how can ⁢Nepal navigate these ⁣challenges?

* **Open Discussion:** Could​ Nepal’s approach to China be⁤ a model ⁤for other countries facing similar geopolitical dilemmas? How can smaller nations effectively ​leverage relationships with larger‌ powers without becoming pawns in geostrategic games?

**Section 4. Looking Ahead -‍ A⁢ New ‌Era for ⁢Nepal:**

* ⁣**Host:** Mr. Li, how ​do you see China’s relationship with Nepal evolving in the coming years? What are ⁢the key areas of cooperation and potential friction‍ points? ‍ Dr. Sharma, from Nepal’s⁤ perspective, what needs to be prioritized to ⁢ensure a stable⁣ and ⁤prosperous future for the country amidst these shifting international dynamics?

* **Open Discussion:** Is Nepal on the cusp of ‌a new era, one marked by greater economic dynamism driven by its partnerships with ‍both India and⁢ China?

**Conclusion:**

* ⁤**Host:** Thank you, ‍Dr. Sharma and Mr. Li, for ‌providing insightful perspectives on this crucial development in South Asian ‌geopolitics. Nepal’s foreign policy ⁣shift presents both⁤ opportunities and challenges, and‌ it will be fascinating to see how‍ this ⁢new⁣ chapter unfolds. For our viewers, please​ share your thoughts and join the conversation online using #NepalChinaIndia. And stay tuned to World Today News ‍for further in-depth analysis of this evolving ⁤story.