Nepal’s relations towards China have shown vigour and energy in recent times. The thrust has been on cooperation for economic stability and prosperity. Deputy Prime Minister Krishna Bahadur Mahara’s six days visit to China, soon after Prime Minister Sher Bahadur Deuba’s visit to India, shows Nepal’s emphasis on developing trans-Himalayan linkages. Nepal, land-linked with both its neighbours, has stressed on infrastructural development, energy cooperation and tourism for economic development. Although China has been cautious in its dealings with Nepal, it is gradually making its presence in various infrastructure development sectors be it road construction or hydropower. The visit by Deputy Prime Minister reiterated the pathway that the country has chosen in its relations with China.

The visit emphasised the importance Nepal gave to China’s Belt and Road Initiative (BRI) that would bring in `mutual cooperation in developing cross-border connectivity, building infrastructure, promoting trade, tourism, investment and people to people relations’ as was mentioned in the press release. Earlier in May this year, Nepal had signed a Memorandum of Understanding (MoU) on BRI with the Ambassador of China in Kathmandu. Nepal has shown interest to gain benefits from China’s initiative to revive old silk route and secondary routes. Historically Nepal was not part of the old silk route but has had trade and cultural linkages with Tibet and is now eager to develop road and rail routes with the Tibet region of China. Till recently Kathmandu-Kodari road, developed by China in the sixties, was the main road link for trade purposes. After its damage in the earthquake in 2013, another route from Kerong pass to Rastafari was opened in 2014 and the border point was upgraded as an international port. Nepal is looking forward to the railway connectivity. The Qinghai-Tibet railway link that presently reaches till Xigaze is nearly 540 km away from Kerong.

The visit highlights Nepal’s interest to emerge as a destination for the Chinese tourists. A MoU was signed to this effect. In recent years Nepal has emerged as a tourist destination for the Chinese nationals. According to a report by the tourism ministry, the number of Chinese tourists went up to 89000 plus in 2015 from 42000 in 2012. One of the reasons for such an increase is due to the direct flights scheduled daily from China to Nepal. Air China and China Eastern flights operate from Kunming to Kathmandu and China Southern flies from Guangzhou and Kathmandu. Correspondingly, Nepal has waived off visa fee for the Chinese nationals and has made Yuan convertible for tourists and businessmen. The increase in Chinese tourists has had an impact on related sectors to tourism, such as the language centres where tour operators and guides learn mandarin in order to interact with the tourists who are generally not well conversant in English. Utilizing the facility provided by Nepal government to give business licenses to foreigners, many Chinese nationals have set up restaurants in the tourist towns of Kathmandu and Pokhara to cater to the increasing tourists. To promote its cultural heritage and Mandarin language in Nepal, China has started setting up China Study Centres (CSC) since 2000. There are nearly 10 CSCs set up close to the border with India such as Butwal, Biratnagar, Morang, Sunsari, Nepalganj or Lumbini. In 2007, Confucius Institute was set up in Kathmandu University for teaching Chinese language and culture.

Buddhist tourism is an interesting emphasis in the present MoU, which aims to attract Chinese tourists to the Buddhist sites such as Lumbini. In fact, DPM Mahara laid emphasis on the Chinese Buddhists to visit the birthplace of Gautam Buddha in Nepal. Lumbini is one of the major symbols of Nepal’s national pride, apart from Everest. The emphasis on Buddhism also stems from the fact that China has recognised Buddhism as a soft power resource. With a population of 300 million Buddhists in the country, China is making an attempt to promote Buddhism at home which, unlike Tibetan Buddhism, is a local religion without any religious authority outside the country. China has recognised Buddhism as a political resource and is capitalising on it to create links and undermine influences of Tibetan Buddhism in Nepal. Nepal treads on the transhimalayan linkages carefully. It does not allow political activism by the Tibetan exiles but cannot negate the historical Buddhist connections with Tibet.

Nepal has made attempts to cooperate with China on energy development. China has made an entry in the energy sector through west Seti hydropower project. Three Gorges Corp is constructing 750mw hydropower project with 75 percent equity and Nepal Electricity Authority shares the rest. During DPM Mahara’s visit, another MoU was signed on energy cooperation between the two countries which re-emphasized on joint investments in power grid projects and cross-border power grid interconnection.

The renewed energy and vigour in relations with China became prominent after the Madhesi agitation and the blockade of the border with India. Many in Nepal perceived it to be supported by India, especially the people from the valley who wanted to open trans-Himalayan links with China as a countervailing measure. The road and rail linkages may not have economic viability in terms of cost of goods but it has geo-strategic and political significance. It would not only provide an alternative route to Nepal albeit limited but would open Nepal to China. The strategic importance of road and rail links from Tibet to Nepal cannot be ignored. Nepal is trying to redefine its role in the Himalayas and finds China as the ready partner.

Another narrative emerging from Nepal is that the policy of balancing neighbours does not pay in the long run instead the country should emphasise on being a link between its neighbours. It takes a cue from history where Nepal was a transit for trade and cultural links between its neighbours.

Nepal’s socio-cultural, economic relations with India are close but it would also take advantage of China’s economic development. It has to make a delicate balancing act with both its neighbours so as to not hurt any one’s strategic sensibilities. It would be a sign of mature foreign policy that would not bring neighbours close to each other’s borders. Even though India and China share 4057 km of long with some areas still remaining unresolved but the open border with Nepal brings its own share of complexities.

Sangeeta Thapliyal is a professor in the Centre for Inner Asian Studies, School of International Studies, JNU.