Nepal’s Oli and India’s Modi: Continuity or Change  

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Nepal’s new Prime Minister Khadga Prasad Sharma Oli’s recent visit to India, amidst uncertainty, triggered many debates. But the first question is why and how this government will be significantly different from previous ones given that this is not the first time Oli’s UML party is in the government.  Second, is Oli’s government really committed to economic growth and development of Nepal as it trumpeted? Given several constraints development and economic growth  are likely to falter under the weight of  Oli’s own commitments. Just one or two huge contracts with China will be far too little to fulfill Nepal’s needs. Third, is Oli’s government that powerful and self-sufficient as perceived? The government is asking Western development institutions for help to run its newly federal governance system. Fourth, there are several instances where the UML’s characteristic behavior, especially Oli’s, is failing to convince the Nepalese that  they prioritize party over nation.


The combination of the UML’s behavior and the constraints—both domestic and external – point to continuity; the only change is that Oli has been blatantly defending the Nepali establishment’s position vis-à-vis any external partners, whether India or the European Union, which has elevated his status in many ways. But aside of his lofty speeches, he is unable to deny the reality of power politics, hence the India visit. On India’s part, to be able to make Oli visit India before China, despite the fact that Oli won elections mainly on his stand against India’s heavy-handedness, is a diplomatic success for India – Indian FM Swaraj’s unofficial visit to Nepal to meet Oli clearly paid off, although Oli had some token excuses as he received the Pakistani PM first. 


Regarding the Pakistan PM Abbasi’s visit, the question remains, how substantial the visit was beyond  the talks of SAARC revival vis-à-vis India and how that plays into expectations of his voters that Oli would actively engage China in Nepal. Oli’s foreign minister Gyawali, who is visiting China, said that the Buddhi Gandaki hydroproject contract – one of the major projects of Nepal-China cooperation which the world is keenly watching - is not even on his agenda. This means that India’s main challenge here is again China, not Nepal or Oli, and the emphasis given to Oli seems exaggerated.


Nevertheless, this does not mean that India should discount Oli, and the Indian government is somewhat giving him due importance. Oli is neither ultra-nationalist nor anti-Indian as tagged. Despite several weaknesses like any other leader, Oli has shown maturity in terms of Nepal-India relations. He has hardly engaged in negative rhetoric vis-à-vis India, apart from emphasizing Nepal’s own national interests. Similarly, although Oli is stressing friendship rather than agreements in his diplomacy, his response to India’s diplomatic overtures and India’s announcements of land and water connectivity plans during his recent visit is helping India buy more time to compete with Chinese infrastructure projects. 


All in all, it does not matter much whether it was a sort of “reset” in the relation or not, because in substance there is continuity in both sides. In India neither BJP leaders nor Congress leaders want to give Nepal and its leaders an elevated status and importance due to the domestic electoral implications for them. India’s policy elites and commentators continue to see Nepal through certain traditional biases. For Nepal, its dependence on India continues and, even though China is financially and politically more active than in the past, uncertainty about the depth of this relation continues. Moreover, what relations China and Nepal will have will also depend upon how India-China relations evolve.  Therefore, right now, Nepal is keeping its options open, mirroring India’s policy, of not fully aligning with one actor. So just continuity, no change.