Oli’s India visit: Resetting bilateral relations for mutual benefit

After a brief interlude of turbulent bilateral relations starting September 2015, a U-turn appears to have been effected in India-Nepal relations after the December 2017 elections in Nepal. Prime Minister Modi congratulated the top three political leaders of Nepal over telephone on December 21 for holding the elections successfully. Exactly a month later, he congratulated the UML chairman and then PM-in-waiting KP Sharma Oli over the UML-led left alliance attaining a majority in Parliament and offered India’s unconditional support for and commitment to work with the new government in Kathmandu. As part of confidence building measures, on February 1, Modi sent External Affairs Minister Sushma Swaraj as special envoy to discuss bilateral relations with the left alliance leaders, and especially with Oli. Media reports indicated that the Swaraj visit took place upon a special request from Oli to Modi. During that visit, Swaraj conveyed Modi’s message and also invited Oli to undertake an official visit to New Delhi after assuming office.

Visit outcomes

The U-turn culminated in Prime Minister Oli’s three-day official visit to New Delhi starting April 6. The visit is widely rated as most successful and historical. In contrast to Oli’s previous visit in February 2016, as well as to the visits made by Prachanda and Deuba in September 2016 and August 2017, respectively, the current visit of Oli has been characterised as remarkably different. First, Oli was received at the airport by Union Home Minister Rajnath Singh, who is second in rank in the Modi cabinet. Second, not only was Oli’s first foreign visit to India but even his first official meeting as PM took place with Indian business leaders on which occasion he invited Indian investors to Nepal. Third, the two leaders held a one-on-one meeting for over one hour at Modi’s residence before the delegation level meeting. Such one-on-one meetings rarely happen during visits of high level delegations to India. Fourth, other than the 12-point regular joint statement, three special statements on agriculture, rail linkages up to Kathmandu, and inland waterways, were issued during the visit. Fifth, for the first time in the last three years, the joint statement did not mention internal issues of Nepal such as amendments to the new constitution, inclusion of minorities, Madhesi, etc. Last, but not the least, both leaders found synchronization between their favourite development frameworks - ‘Sabka Sath Sabka Bikas’ and ‘Samriddha Nepal Sukhi Nepali’.

Purpose of the visit

The principal purpose of the visit was to remove the mistrust that had emerged in bilateral relations in the wake of Nepal’s adoption of the new constitution and India’s reservations about some of its provisions. The relationship had reached a new low when Nepal unilaterally recalled its ambassador and cancelled its President’s India visit in May 2016. A thaw emerged only after the completion of the Parliamentary elections in December 2017. While addressing Nepal’s Parliament before his three-day India visit, Oli said that “the visit is aimed at deepening the relations that have subsisted between Nepal and India since ages.” From the Nepali point of view, the other purposes of the visit could have been to seek India’s support for economic development, move forward on the implementation of past agreements and ensure a mutually cooperative relationship. Nepal also wanted to re-frame its bilateral relationship with India in the context of recent domestic and regional developments.

Mutual feeling to mend relations

For its part, India too undertook unilateral steps towards course-correction. This, despite all those internal issues in Nepal that had created the rift in bilateral relations, remaining unaddressed. There could be many reasons for India’s course correction. First, since India values democracy, Modi personally felt that the public mandate in favour of the UML-led left alliance needs to be respected and that India should support institution building in Nepal under a popular government. Second, this realization in New Delhi may have also been occasioned by changes at the bureaucratic level — those officials who dealt with Nepal affairs ever since the constitutional promulgation process had left their desks in the foreign office and agencies from March 2017 onwards. It is possible that new officials posted in key positions and tasked with following Nepal perhaps started looking at the bilateral relationship from a different perspective. Third, domestically, Modi came under tremendous pressure to improve relations with neighbouring countries and especially with Nepal with which India shares a multi-layered relationship. The Indian media was particularly critical of Modi’s Nepal policy in the post-constitution period. Fourth, the more than 70 per cent voter turnout and the active participation of Madhesis and Janajatis in Nepal’s three level elections – local, provincial and federal – under the new constitution forced India to revisit its earlier position, shed reservations on the constitution and modify policy towards Nepal.

Even as India reached out to the new government in Kathmandu, the Oli government had its own reasons to respond positively to the Indian overtures. First, it needed massive developmental assistance to fulfil its poll promises like roads, rural electrification, drinking water, irrigation, jobs, hospitals, industrial zones, railways and airports. Despite China’s increasing economic cooperation with Nepal, India continues to remain Nepal’s largest trading and business partner. Further, India is the only transit country for Nepal’s third country trade despite having signed a transit agreement with China in March 2016. Second, the Oli government also realized the requirement for massive funds to implement federalism through the creation of the necessary administrative infrastructure in the provincial capitals. Since China opposed federalism in Nepal, the Oli government was not sure about receiving Chinese financial support for that purpose. Therefore, it decided to explore the prospects for India’s support in this regard. And third, politically, Oli might have felt that rapprochement with India could prevent the formation of a non-UML government in Kathmandu given the slow progress in unification of the two left parties and intra-party factionalism in the UML. If such a situation were to unfold, Oli could seek the support of the Terai based parties to remain in power.

Trilateral cooperation

Therefore, despite winning the elections on a nationalist plank by projecting India as an interfering neighbour, Oli chose New Delhi as his first port of call. He was well aware of India’s obsession about every new Nepali PM undertaking the first official visit to India. He could undertake the visit with confidence without being apprehensive of its fall-out on Nepal’s relationship with China because the latter, in a statement issued in March 2018, appreciated Nepal’s effort towards adopting an independent foreign policy and “developing friendly and positive relations with its neighbours." Earlier, China had also advised Nepal to maintain good relations with India. Chinese analysts argue that such a rapprochement between New Delhi and Kathmandu could create the ground for trilateral cooperation and successful implementation of BRI projects in the Himalayas.

Challenges

No doubt, the purposes of the visit have been achieved and a new phase of relationship has begun with India acknowledging Nepal as an ‘equal partner’. While the visit has set a new tone in the relationship, it has also brought fresh challenges to the fore in terms of each country addressing the other’s concerns. Certainly, the challenges are more for India than they are for Nepal. There is a trust deficit in Nepal because of the Indian reputation for delaying implementation of various projects. This has sent a wrong message in Nepal that the delays are deliberate. After Oli’s latest visit, which has created new expectations in Nepal, India needs to seriously address this problem of delivery-lag.

Views expressed are of the author and do not necessarily reflect the views of the IDSA or of the Government of India.