China overtakes India in providing assistance to Nepal

9 May 2016 | By Achin Garg

China has become the 4th largest donor to Nepal even as India slips out of the top 5 donor list.

The data on Official Development Assistance (ODA) to Nepal for FY2014-15 shows that China's assistance stood at $37.95 million against India's $22 million.

Nepal has seen a 50% decline in India's ODA even as China is seen investing in infrastructure projects in Nepal.

In context: The tussle for Nepal

About Nepal: A country profile

Nepal is a landlocked Himalayan nation which is bordered on 3 sides by India and on the North by China.

Home to 31 million people, it has an area of about 1.47 lakh sq. km, little less than the area of Odisha.

After years of struggle, the nation had last year adopted a new Constitution which declared Nepal as a socialist democratic republic.

2015Madhesi protest pushes Nepal closer to China

The relations between Nepal and India had turned sour after the new Nepalese Constitution failed to provide adequate representation to the Madhesi people.

Madhesi people, who are of Indian origin and reside in the Terai belt adjoining India, had blocked the India-Nepal trade severely crippling the Himalayan nation, which is heavily dependent on India for supplies.

This had pushed Nepal closer to China.

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Nepal gets an alternate route to the world

Nepal signed the trade and transit treaty with China during the China visit of Nepalese Prime Minister KP Oli in Mar'16. The proposed Nepal-China rail line will end India's monopoly as a transit nation for Nepal's trade to the world.

7 May 2016Nepal cancels President's visit to India

Nepal had recalled its Ambassador to India, Deep Kumar Upadhyay and also cancelled the visit of President Bidhya Devi Bhandari just 72 hours before her scheduled departure.

The Nepalese President was to land in India on 9th May and visit the ongoing Simhastha Kumbha in Ujjain.

She was to meet top Indian leaders Indian President, Prime Minister, and other leaders and attend Vaicharik Kumbha.

8 May 2016Reasons for objection by Nepal

According to sources, Kathmandu had expressed security concerns over the President's Ujjain trip due to heavy rains and storms on 4th May. It was also unhappy with the President meeting with Indian Prime Minister at latter's residence.

Nepal's ambassador to India, a seasoned politician, had advised against the cancellation of the visit.

However, he was recalled citing reasons of non-cooperation and lack of trust.

The real reason

Behind the curtain, the real reason is believed to be Nepal's unhappiness over India's alleged meddling in the internal power struggle between Nepalese PM KP Oli and former PM Pushp Kamal Dahal or Prachanda.
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8 May 2016Nepal rubbishes reports of action against India envoy

According to some media reports, Nepal is contemplating action against Indian ambassador to Nepal, Ranjit Rae and may declare him as persona non grata for allegedly destabilising the Oli government in Nepal.

However, Nepal has rubbished those media reports as "baseless" and aimed at hurting India-Nepal relations.

However, the recent series of events makes it challenging to bring back to normal the Indo-Nepal relations.

Playing the perception game

Meanwhile, Indian foreign experts believe that blaming India for its internal problem so as to gain domestic constituency is an old habit of Nepal. However, this does impact the perception of India in the minds of Nepalese.

9 May 2016China overtakes India in providing assistance to Nepal

Top 5 donors to Nepal

Nepal received maximum ODA from the UK which was followed by the US, Japan, China and Switzerland.