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Himalayan Frontier
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU
Significance of Prime Minister KP Oli's New Delhi Visit
Forecast 2016: Nepal
Nepal’s New Constitution: Instrument towards Peace or Catalyst to Conflict?
IPCS Forecast: Nepal in 2015
Constitution-making: Will Nepal Miss its Second Deadline?
The Future of SAARC is Now
China in Nepal: Increasing Connectivity Via Railways
India-Nepal Hydroelectricity Deal: Making it Count
Federalism and Nepal: Internal Differences
Modi and Nepal-India Relations
Nepal's Restful Prime Minister
Chinese Inroads to Nepal
Constituent Assembly-II: Rifts Emerging
Nepal: The Crisis over Proportional Representation and the RPP Divide
#4991, 19 February 2016
Significance of Prime Minister KP Oli's New Delhi Visit
Pramod Jaiswal
Senior Research Officer, IReS, IPCS
E-mail: pramodjai@gmail.com

The Prime Minister of Nepal, KP Sharma Oli, will his maiden visit to India, from 19 February 2016. During his six-day visit, he is scheduled to meet Indian President Pranab Mukherjee, Indian Vice President Hamid Ansari, Indian Prime Minister Narendra Modi, and Indian Minister of External Affairs Sushma Swaraj, among others. He is also scheduled to visit Mumbai, Dehradun and Bhuj. Oli’s visit comes at a time when India-Nepal relations are under strain with Kathmandu accusing New Delhi of having a hand in the ‘undeclared blockade’ at the border. Therefore, given the prevailing state-of-affairs, it will be useful to explore the ongoing developments in the bilateral and the significance of this visit.

India-Nepal Relations
India and Nepal have historical, socio-cultural and economic ties. The border between the two countries are open, post the 1950 Indo-Nepal Treaty of Peace and Friendship, both countries provide special privileges to each other. Cross-border marriages are also quite common. India is Nepal’s largest trading partner and has contributed significantly towards development of the nation. It has played a critical role in all the political transformation in Nepal. Most recently, in the aftermath of the massive earthquake that struck Nepal in April 2015, India was the first country to provide a team of the National Disaster Response Force, along with relief material, and even pledged USD 1 billion for Nepal’s reconstruction.

In spite of its remarkable contributions in the country, New Delhi has been strongly criticised.

The recent controversy emerged with the mention of the Lipu-Lekh Pass in the joint statement issued during the Indian prime minister’s visit to China in May 2015. Nepal stated that the mention of the Lipu-Lekh Pass in their joint statement threatened Nepal’s sovereignty and territorial integrity.

Furthermore, there has been major setback in bilateral relations since the promulgation of Nepal’s new constitution and the election of the incumbent Prime Minister KP Sharma Oli. The Oli government accused India for imposing the blockade that led to a severe humanitarian crisis in Nepal. India refuted those allegations, stressing that the border tensions were caused by the Madhesi parties and were the outcome of internal protests in Nepal, and that Kathmandu should urgently resolve the issue to create a sense of “security and harmony” in the Terai region and ensure “uninterrupted commerce.”

The current deadlock in Nepal erupted with the promulgation of the ‘non-inclusive’ constitution that ignored the demands of the Madhesis, the Tharus, other indigenous groups, and women, leading to the strong protests in the southern plains. This resulted in a disruption at the India-Nepal border.

Nepalese leaders had repeatedly assured India of an ‘inclusive’ constitution. A last-minute attempt too was made in the form of sending its most capable officer as the prime minister’s envoy, but it was in vain. It was the first time that India openly stood by the voices of the Madhesis and the Tharus, and there were two basic reasons for the same: first, India was witness to the 2008 agreement between the government and the Madhesi party and second, an ‘inclusive’ constitution would bring peace and stability in Nepal that will serve India’s security concerns.

Interestingly, on 05 February 2016, in a mysterious turn of events, protestors were driven away from the India-Nepal border, allowing for the movement of vehicles. 135 days after the protest began, the Madhesi parties that had led the protest were forced to announce the end of blockade.

Significance of Prime Minister Oli’s Visit
Oli’s visit was actualised due to slight progress on both the fronts, and is a clear indication of a change in India’s approach (from hard-handedness to soft) towards Nepal. It is also New Delhi’s last ditch effort to convince Oli and resolve the ongoing crisis in Nepal. Moreover, it bears great significance not just because it is scheduled to take place at such a critical juncture but also because it will have lasting implications on the India-Nepal bilateral.

Since the focus during this visit will be on the resolution of the current crisis, signing of agreements is unlikely. The Oli government had already visited New Delhi with the commitment to resolve the crisis through the ‘roadmap’ – that mentioned resolving the issue via amendments and a political mechanism with a three-month timeframe.

Oli’s visit is aimed at building confidence between the two governments. India expects delivery on commitments within the stipulated time. In return, Oli seeks India support for his regime. The Oli government lives with the fear of being overthrown, with Indian political maneuvering, after his government addresses the demands of the Madhesis, particularly due to his leaning towards China.

The visit has surely generated environment for normalisation in the relations. By sending a high-level political delegation under the leadership of the Indian Minister of External Affairs Sushma Swaraj to pay a final homage to Nepal’s former Prime Minister Sushil Koirala when he passed, New Delhi indicated its commitment to engage with the Oli government. The Delegation called on the Nepalese president and prime minister before returning.

The present halt in the Madhes movement is only temporary, as anger still remains among the Madhesis remains. It is yet to be seen if India is able to win Oli over and get both sides (Kathmandu and the Madhesis) together for peace and stability in the country. The next three months will be crucial for Oli and much of India’s relations with Nepal depend on it.

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#4970, 25 January 2016
Forecast 2016: Nepal
Pramod Jaiswal
Senior Research Officer, IPCS

The year 2015 was historic in many ways. It was a year for both despair and enthusiasm. While Nepal suffered from a devastating earthquake, it also promulgated its most awaited constitution through the Constituent Assembly (CA) elected by the people. The earthquake brought the country together where the ‘non-inclusive’ Constitution divided the country further. India, which was highly appreciated for its role during the earthquake, had to face stark criticism and anti-India slogans for its alleged hidden hand in the ‘undeclared blockade’ at the border and the issue of Lipu-Lekh Pass.

Fallacies in the New Constitution
Strong protests have erupted in Nepal since the promulgation of the new Constitution in September 2015. The Constitution neither followed the proper procedures nor did it address the aspirations and legitimate rights of the Madhesis, Tharus, women, Dalits, Muslims and indigenous people. The agitated parties have been on the streets, protesting, for more than five months, causing obstruction at the India-Nepal border, which has resulted in an acute shortage of fuel and other essential goods in Kathmandu. It has also claimed more than 50 lives.

The Constitution was produced in haste through a fast-track mechanism without proper consultation with all 601 CA members. In fact, even the CA members had to abide by their party’s dictate, else they would have been liable to face disciplinary action which could have led to their expulsion from the party. Surprisingly, Nepali Congress (NC), one of the architects of the Constitution, decided to table the amendment two weeks before it was promulgated. It is also significant to mention that the Unified Maoists and other parties approved the Constitution by formally registering their dissenting opinions on several provisions of the new Constitution.

In fact, it was the outcome of the five most influential leaders of each of the three major political parties - NC, Communist Party of Nepal-Unified Marxist-Leninist (CPN-UML), and Unified Maoists - who overlooked the dissenting voices of the Madhesis, Tharus, women's groups, Janajatis (indigenous people), and other marginalised groups such as the Dalits and Muslims. All of these leaders, with the exception of one hill Janajati, come from the dominant hill high caste Brahmin/Chhetri. Therefore, not even a single influential Madhesi and Janajati CA member from any major political party has publicly defended the Constitution.

Women, who account for more than half of Nepal’s total population, also came out on to the streets to protest the discriminatory clause on citizenship. Unlike the interim Constitution, the promulgated Constitution does not grant equal citizenship rights to men and women. Women marrying a foreigner are not given equal citizenship rights compared to women marrying Nepali men. Similarly, the passing of the new Constitution was not welcomed by the Janajatis (who constitute one-third of the total Nepalese population), as their demand for proportional and inclusive representation, identity-based federalism, etc, were not accommodated. The strongest dissent came from the Madhesis and Tharus, who also comprise one-third of the total Nepalese population. 
Aspirations of Madhesis
Strong protests were triggered in Madhes as the three major political parties - the Nepali Congress, CPN-UML, the Unified Communist Party of Nepal (Maoist), and the Madhesi People’s Rights Forum (Democratic) - rushed through the Constitution without implementing the previous agreements signed between the government of Nepal and the Madhesi parties in 2007 and 2008. Although some aspects of the earlier agreements have been included in the new Constitution, the four core issues - electoral constituencies based on population, proportional representation of Madhesis in government bodies, autonomous identity-based provincial demarcation, and equal citizenship provisions for Nepali women marrying foreigners - have not been not incorporated.

‘Unofficial Blockade’
The stalemate over the acceptance of the new Constitution and unrest in Madhes, a region bordering the Indo-Nepal border, has propelled anti-India sentiment among the ruling elites. Madhesis are waging a ‘non-cooperation movement’ on the India-Nepal border, which has halted the entry of fuel and other essential supplies to Kathmandu from India. The ruling elites of Kathmandu claim that the ‘blockade’ is imposed with Indian support as India did not welcome the non-inclusive Constitution.

However, the leaders of the United Democratic Madhesi Front (UDMF) that consists of four major Madhesi parties has publicly acknowledged the blockade as of their own making, and have offered to lift it only after their legitimate demands are addressed in the new Constitution. India has rejected the allegations of Kathmandu, stressing that the tension at the border is a result of internal protests in Nepal, and that the Nepalese government should urgently resolve the issue to create a sense of "security and harmony" in the Terai region and ensure "uninterrupted commerce."

India-Nepal Relations
In 2014, Nepal figured prominently in India’s foreign policy, with the Indian Prime Minister Narendra Modi paying a visit to Nepal, the first Indian PM to make an official visit in 17 years, followed by a subsequent visit  in November 2014 for the 18th SAARC summit. Modi, who enchanted Kathmandu in 2014, had to face a major backlash in 2015 with the rising anti-India voices since the promulgation of the Constitution.

Operation ‘Maitri’
The devastating 7.9 magnitude earthquake of 25 April 2015, followed by the powerful aftershock of 7.4 magnitude on 12 May 2015 , caused massive destruction and claimed thousands of lives in Nepal. Within hours of the calamity, Indian Prime Minister Narendra Modi spoke to the Nepalese Prime Minister Sushil Koirala and Nepalese President Ram Baran Yadav assuring them of India’s commitment to help Nepal. Within six hours, India dispatched a team of the National Disaster Response Force (NDRF) along with relief material. India’s total relief assistance amounted to USD 67 million, and it committed to another USD 1 billion (one-fourth as a grant). Though India’s swift response was highly appreciated, the Indian media was severely criticised for being insensitive in their reportage of the tragedy.

Controversy Over Lipu-Lekh Pass
A major controversy emerged between India and Nepal when Nepal claimed that the Lipu-Lekh Pass to be a disputed tri-junction in which Nepal has an equal share. Lipu-Lekh was mentioned in the China-India joint statement during Indian Prime Minister Narendra Modi’s visit to China in May 2015. The joint statement read: “The two sides agree to hold negotiation on augmenting the list of traded commodities, and expand border trade at Nathu La, Qiangla/Lipu-Lekh Pass and Shipki La.” Nepal, under the pressure of the media, civil society and the opposition, demanded that China and India withdraw the mention of Lipu-Lekh in their joint statement.

Nepal argued that the mention of Lipu-Lekh Pass in their joint statement threatened Nepal’s sovereignty and territorial integrity. However, Indian experts counter-argued that both China and India have been referring to Lipu-Lekh Pass as one of their border trading points since 1954. Indian experts have pointed to Nepal’s position on Kalapani and Lipu-Lekh Pass as being politically motivated, especially given how ultra-nationalist groups have been involved in spreading anti-India sentiment and demanding a ‘Greater Nepal’ to gain political mileage.

Future Scenario
The political parties of Nepal should resolve the differences in the Constitution at the earliest through a process of dialogue with all the discontented parties. If the issue is not resolved, three kind of scenarios may evolve: one, Madhesi youth will be radicalised, resulting in violent armed action; two, the demand for a separate state will gain momentum (like CK Raut's group) rather than the current demand for an autonomous province; and three, further progress towards communal violence between the hill people and the Madhesis will be made. Alongside, there will be escalation in cross-border crimes such as arms smuggling, fake currency trade, human trafficking, as well as terrorist activities. The continuous intensified tension will draw the attention and consequent role of other players like the EU, US, China and Pakistan. These will have far deeper and lasting implications for India-Nepal relations.

Sourness in India-Nepal relations although temporary, may linger for a few more months. The current anti-India sloganeering in Kathmandu will prevail till the crisis is resolved. India, with its tremendous leverage in Nepal, should not shy away from its responsibility but engage all the political parties for early resolution as witnessed with the agreement between the Madhesis and the Government of Nepal in 2008. There is a perception in Madhes that India might reverse its course to placate the leadership in the hill region, which would further complicate the Nepalese situation. India also needs to manage the Nepalese media and public perception in Nepal to contain the rise of anti-India propaganda.

In 2016, Nepal is likely to  be primarily engaged in the issue of Madhes and the new demands of the Janajatis. It will face strong challenges in implementing the new Constitution, especially the federal provisions. With the visit of Nepalese Prime Minister to India and China, and the Chinese President’s visit to Nepal, there will be deliberations on China's increasing influence in Nepal and India's reactions. In all these, the most ignored will be the earthquake-affected people, despite the massive inflow of foreign aid to Nepal.

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#4914, 19 September 2015
Nepal’s New Constitution: Instrument towards Peace or Catalyst to Conflict?
Pramod Jaiswal
Independent Analyst on South Asian affairs, and Nepal expert

On 17 September 2015, amidst the curfew and violence that erupted in southern Nepal due to protests organised by the Tharu and Madhesi ethnic communities against Nepal’s constitution, the members of the country’s Constituent Assembly (CA) voted in favour of the new statute. All is set for President Ram Baran Yadav to promulgate the new constitution on 20 September 2015 in a ceremony that will be attended by the members of parliament, cabinet members, members of constitutional bodies, high-ranking officers of Nepal’s security forces, and members of the diplomatic community.

The long wait for the finalisation of the new constitution is over, but it has raised some pertinent questions:  How long will this constitution last for? Does it truly reflect the aspirations of the people? Or will it be a catalyst for fresh rounds of violence and conflict in the country? Is the new constitution an inclusive charter like the democratically elected CA or is it just an elitist exclusive document?

Making of Constitution 
The historical journey till the promulgation of the new constitution has not been easy. Nepal has had seven constitutions (including the interim constitution) in the past six decades, but this is the first time a constitution has been passed by a properly elected CA. It was one of the demands of the Maoists, who had waged the decade-long armed struggle against the state, for joining the peace process. The first CA was elected in 2008 was dissolved in 2012 as it failed to deliver the constitution despite several postponements due to bitter differences among political parties on matters of federalism, government, judiciary and elections.

The second CA was elected in 2013 and political parties pledged to deliver the constitution in one year. Federalism remained the bone of contention but the 16 point agreement was a breakthrough, resulting in the present constitution. In the 16 point agreement, top leaders of the major political parties represented in the CA – the Nepali Congress, the Communist Party of Nepal – Unified Marxist Leninist, the Unified Communist Party of Nepal (Maoist) and the Madhesi People’s Rights Forum (Democratic) – agreed to federate the country into eight provinces and promulgate a constitution. The issue of names was left to be decided later by a two-third majority in the state assemblies of the respective provinces. Likewise, leaders agreed to form a Federal Commission, which will have six months to delineate the boundaries of the federal provinces.

With disagreements from the Madhesi parties, they agreed to demarcate the boundaries of the federal provinces. Surprisingly, they formed six provinces that were later increased to seven. Yet, it failed to satisfy the Tharus and the Madhesis. In fact, it instigated violent protests around the country that claimed over 40 lives in few weeks.

The new constitution embraces the principles of republicanism, federalism and secularism. However, commentators like CK Lal challenge the secular flavour of the new constitution. Lal says, “Nepal’s Constituent Assembly claims that it will remain a secular state, but also admits that ‘secularism means protection of Sanatana Dharma’. Hence, Nepal has become a Hindu State through the backdoor.” At he same time, Madhesis reject the new Constitution as being non-inclusive.

According to the new constitution, Nepal will have a parliamentary form of government with a president elected by collegia of central legislative houses, the Legislative Parliament and the National Assembly, as well as the provincial legislative bodies. The prime minister will be elected by the Legislative Parliament, based on a majority. The Constitutional Council will nominate the Chief Justice, heads, and members of the Constitutional Commissions. The Judicial Council nominates the judges of the Supreme, High, and District Courts, thus making the judicial system is an integrated one.

Challenges in Implementation 
Promulgating the Constitution was a herculean task by the CA and the implementation will be equally challenging. The core aim of formulating the new constitution via the CA was to undo the concentrations of power — political, social and economic — to make the Nepalese society inclusive and democratic in the widest sense. However, the Madheshi, the Janajatis, women and the marginalised communities have outright refused to accept the new constitution.

The Madheshi and Tharus are demanding provisions for proportionate inclusion of under-represented groups in the state organs, constituency delimitation on the basis of population to ensure political representation of the Tarai, and the revision of federal boundaries. Women representative groups perceive the new Constitution as regressive, for it adopts discriminatory citizenship laws. Simultaneously, there is an emerging voice towards the demand for an autonomous Limbuwan province by the Janajatis of Eastern Nepal.

The process that was already challenged by the splinter groups of Maoists has received the support of the Tharus, the Madhesi and women representatives. Interestingly, the only Madhesi party that was initially a signatory of the 16 point agreement also withdrew its support.

Therefore, Nepal’s new constitution fails to arouse the enthusiasm it could have otherwise generated had it had been promulgated with the support of all the major stakeholders. It is not wrong to posit that it might in fact trigger a fresh round of protests by the Tharus, the Madeshi and the other ethnic groups who have been demanding provinces based on identity.

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#4805, 14 January 2015
IPCS Forecast: Nepal in 2015
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

This edition of the IPCS Column, 'Himalayan Frontier', is a precis of the larger document of the same name, that is part of the IPCS's 'Forecast 2015' series. 
Click here to read the full report.

Since the end of the decade-long Maoist insurgency in 2006, Nepal has struggled with the difficult transition from war to peace, from autocracy to democracy, and from an exclusionary and centralised state to a more inclusive and federal one. The newly-formed federal, democratic republic has also been struggling for a constitution since then.

Internally, Nepal’s immediate priority in 2015 is the promulgation of its constitution. If it does not succeed, the country may encounter prolonged chaotic conditions. Nepal’s political parties are aware of the potential problems in the event of failure to promulgate the constitution on time. If the May 2015 deadline is missed, Nepal might have to wait for it till 2017. Externally, improving relations with India will be an important issue.

Constituent Assembly: Will it deliver in 2015?
In 2014, there wasn’t much progress in the country’s constitution-making process. The second Constituent Assembly (CA) of Nepal began to hiccuping immediately after its election in November 2013. The political parties did not learn much from the past. Though almost all the parties had agreed to produce the first draft of the constitution by 22 January, 2015, they took almost a month to decide who had the legitimacy to call the Constituent Assembly and wasted six more months to form the Council of Ministers – and still, the CA is not complete.

The constitution is the document of compromise and the debate to make the new Nepal inclusive must ensure the aspiration of historically marginalised peoples towards making all citizens equal, and simultaneously not making them unequal via federalism. It is impossible for the political parties to produce the draft of the constitution by 22 January. It is in the interest of all the political parties to forge broader consensus on the contentious issues and promulgate the constitution on May 28 – the Nepalese Republic Day. However, looking at the rigid stand of the ruling parties, it’s a Herculean task to forge consensus among the major political parties in such a short period.

A multi-party system of governance is constituted of many individuals with different ideas, and a government is usually pressured to impose new legislations to improve the constitutional rights of the country. The political parties’ self-imposed deadline of 22 January – for the new constitution – is only a week away, but these parties are still negotiating on the four contentious issues – including federalism, forms of governance, electoral system and judiciary – that led to the failure of the first CA. The second CA adopted all the achievements of the previous CA and decided to resolve the four key issues, but has failed miserably.

Will the Political Parties Come Together?
Rifts within/ among major political parties slowed down the constitution-making process. Restful Prime Minister Sushil Koirala failed to deliver on many fronts. Due to lack of leadership qualities, he had to struggle a lot during government formation and appointments of officials to several key positions lying vacant in the administration, judiciary, foreign services and security. He could not take any important decisions or pressurise the government to push forward for the timely constitution. However, Nepal successfully conducted the 18th South Asian Association for Regional Cooperation (SAARC) Summit during his tenure in November. As expected, the 18th SAARC Summit could not deliver much, but Koirala cannot be held accountable for that.

Consensus is the only way to get the constitution implemented in Nepal. So far, Nepal has had six constitutions, at different points in time, and the debate to get an acceptable constitution for long-term social peace and stability, continues. All previous constitutions failed to bring peace and deliver to the aspirations of the citizens because it had not taken all the political actors into account. Hence, there was demand for a new constitution via the Constituent Assembly that could be implemented through consensus. If the NC and the UML try to get it passed via majority votes – which is unlikely as their Madeshi/ Janajati leaders have announced to oppose party orders – it would not be successful. The Madheshis and Maoists are uniting and are gaining ground despite multiple splits. Simultaneously, such undemocratic acts would invite polarisation in the ruling alliance (NC and UML) and opposition (Madheshi/Maoist/ Janajati parties).

If all political parties fail to come to any agreement in January, the general public will lose trust in political actors. The situation might get more fluid and difficult to handle.  The ruling alliance will start fighting over who will become Koirala’s successor. The UML had supported Koirala in 2014 on the condition of getting the reins back in 2015. This mess will benefit the ‘radicals’ and would make the constitution making process more complicated. New issues would erupt on the negotiation table. Netra Bikram Chand, who broke away from the CPN-Maoist (Baidya faction) to complete the remaining task of ‘people’s war,’ would gain support among the radical communists while Kamal Thapa would demand for a ‘Hindu state’ and the ‘role for monarch’. Similarly, Madhesi activists like CK Raut would capitalise on the dissent, frustration and absence of government in the Tarai plains and plop up even more untenable demands. The Modi government in India also poses fear among the Nepalese political parties who stand for a secular and republican Nepal. They think India might support pro-Hindu parties to fight for a Hindu Kingdom.

This unstable debate of constitution-making and quest for power will continue in Nepal. If Nepal postpones the identity criterion of federalism, the constitutional debate will be likely to be endless – merely postponing the social peace and stability. The Madhesis and Maoists might form alliances and protest in Madhes for identity-based federalism. The heat of unified protest of Madhesi/ Janajati/ Maoists and new forces like Jay Prakash Gupta/ CK Raut will be tougher for Kathmandu to resist.  

Sandwiched between China and India: Improving Relations with New Delhi after Modi’s Visit
Nepal, a small nation sandwiched between China and India, has a huge influence of its neighbours. India figures prominently in the Nepal’s foreign policy, and New Delhi has stakes in Kathmandu’s peace process and constitution-making. In 2014, Nepal and India achieved new heights of their diplomatic relations. Indian Prime Minister Narendra Modi visited Nepal in August 2014. He became the first Indian prime minister to visit Nepal in 17 years. During his visit, Modi enchanted the Nepalese people with a rousing address in the Parliament of Nepal, which was the first such address by a foreign leader. He announced a soft loan of $1 billion and committed to assist Nepal in several infrastructure development projects.

Several political parties of Nepal had raised voices against the Treaty of Peace and Friendship of 1950 and some other ‘unequal’ treaties. Hence, during Modi’s visit, both the countries agreed to review, adjust and update the 1950 Treaty and other bilateral agreements. The Power Trade Agreement (PTA) and the Project Development Agreement (PDA) between the Investment Board of Nepal and India’s GMR Group for the development of the Upper Karnali hydropower project was signed in October 2014. Again, during Modi’s second visit to Kathmandu in November 2014, to attend the 18th SAARC Summit, he inaugurated an Indian-built 200-bed trauma centre and flagged off a Kathmandu-Delhi bus service. India also provided a helicopter to the Nepal Army and a mobile soil-testing laboratory to the country. Similarly, the Joint Commission which was formed in 1987 at the Foreign Ministers’ level with a view to strengthening understanding and promoting cooperation between the two countries for mutual benefits in the economic, trade, transit and the multiple uses of water resources was reactivated after a 23-year gap during the visit of the Indian Minister of External Affairs in July 2014.

This edition of the IPCS Column, 'Himalayan Frontier', is a precis of the larger document of the same name, that is part of the IPCS's 'Forecast 2015' series. 
Click here to read the full report.

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#4780, 15 December 2014
Constitution-making: Will Nepal Miss its Second Deadline?
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

With just a few weeks left to meet the 22 January, 2015 deadline for the promulgation of the constitution, the President of Nepal, Ram Baran Yadav, is busy asking the lawmakers to fulfill their commitments.
Contentious Issues
The current Constituent Assembly (CA) that was elected in November 2013 has already taken the ownership of the progress made by the previous CA – which streamlined the tasks of writing a new constitution.  Despite that, Nepalese political leaders made little effort to resolve the contentious issues of the constitution-making. They need to resolve four key contentious issues including federalism, forms of governance, electoral system and judiciary. Due to lack of intensive discussion among the political parties, they have failed to make any substantial progress.

Federalism remains one of the thorny issues major parties are sharply divided on. Among the crucial questions are the numbers of federal provinces, demarcation of boundaries, and names of the federal units. The future of the constitution also depends on how the political parties handle the issue of federalism. The Unified Communist Party of Nepal-Maoists (UCPN-Maoists) advocate for decentralised governance of 10 to 14 provinces based on ethnicity while the Nepali Congress (NC) and Communist Party of Nepal-Unified Marxist Leninist (CPN-UML) call for centralised governance of a maximum seven provinces. The UCPN-Maoists and the Madhes-based parties are demanding more provinces in the hilly regions and less in the Madhes.

The UCPN-Maoist has proposed for a presidential form of government and envisage the directly-elected president as both the head of state and head of government while the NC proposed a reformed parliamentary form of government where the president is the head of the state and the prime minister is the executive chief. Vis-à-vis the electoral system, the UCPN-Maoists proposed a multiple-member, proportional, direct electoral system based on proportional inclusion, to be determined on the basis of the population, geography and socio-economic factors while the NC and CPN-UML proposed a mixed system, with half the members of parliament elected directly on First Past the Post (FPTP) voting and half elected proportionally (similar to the system applied in the CA elections). Regarding judiciary, the NC and the CPN-UML call for a supreme court while UCPN-Maoists demand a constitutional court.

Additionally, the parties of the ruling coalition, namely the NC and the CPN-UML, prefer all decisions to be taken in the plenary of the CA by majority vote while the oppositions (UCPN-Maoists and Madhes-based parties) prefers the consensus approach. 

Polarisation among the Political Parties
Presently, the UCPN-Maoist is building alliances both within and outside the CA to counter the dominant position of the ruling coalition (NC and CPN-UML). Outside the CA, the UCPN-M is reaching out to splinter Maoist groups while within the CA, it has formed an alliance with pro identity-based federalism parties – mainly the Madhes and ethnicity-based parties — called the Federal Republic Alliance (FRA). The signature campaign by Madhesi leaders of the NC against the federal model proposed by the NC and CPN-UML has also foiled the chances of imposing constitution by majority vote. 

Bleak Prospects
It seems unlikely that the newly-elected CA has learnt lessons from the past and would deliver a new constitution of Nepal within the stipulated timeframe. There has not been much change in the leadership of political parties and opportunities to discuss the numbers of provinces and identity issues, and the establishment of self-governance structures for smaller ethnic groups was missed. It is entirely possible that the same challenges that sunk the first CA will resurface.

In spite of all these challenges, one can hope that Nepal gets the constitution within the stipulated time. It is in the interest of all the political parties to fulfill their commitments. The NC can claim the successful promulgation of the constitution during their tenure while the CPN-UML should leave no stone unturned for timely constitution-making as they can claim to lead the next government. In February 2014, the NC and the CPN-UML signed a deal stating that former would hand over the leadership of the government to the latter in January 2015.

A failure to promulgate the constitution by January 22 might break the coalition between the two and destroy the CPN-UML’s chances to lead the government. It might open the possibility for new alliances to be created. The UCPN-Maoists and Madhes-based parties would also like to consolidate their gains as they are pretty assured that Nepal would not go for the third CA election.

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#4725, 4 November 2014
The Future of SAARC is Now
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

The 18th South Asian Association for Regional Cooperation (SAARC) Summit is taking place in Kathmandu at the historic moment when South Asia is going through massive transformation. India elected Narendra Modi as its prime minister with an overwhelming majority. Nepal voted for the second Constituent Assembly after the first failed to deliver the constitution within the stipulated time. Afghanistan, the newly inducted member of SAARC voted for Ashraf Ghani as its president. Sheikh Hasina and Nawaz Sharif were elected to the prime minister’s positions in Bangladesh and Pakistan respectively. The King of Bhutan devolved powers to his country-people who aspired for democracy.

Media reports suggest that three agreements – SAARC Railway Agreement, SAARC Motor Vehicle Agreement and SAARC Framework Agreement on Energy Cooperation – might be signed during the 18th SAARC Summit, scheduled for 26-27 November.

Formation of the SAARC
The SAARC was formed by Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka to actualise their common goals, economic cooperation being one of them. Afghanistan was introduced as the newest member, in 2007.

Regionalism began and flourished around the world after World War II with the aim of liberalising trade among the member states of respective blocs. The end of the Cold War further strengthened their commitments towards greater economic cooperation via free trade agreements, such as in the European Union, the Arab Maghreb Union, the Association of Southeast Asian Nations, the Caribbean Community, the Common Southern Market, and the Southern African Development Community. With the EU’s success story, there has been a rise in the number of such regional organisations. Founded in 1985, SAARC was a late arrival in following the growing trend of regionalism.

Opportune Moment  for SAARC
South Asia can have tremendous opportunity as the economy of the region has great impact on the global economy. The epicenter of global economy is gradually shifting towards the east with the emergence of China and India as the largest economies. Economic integration within South Asia region possesses great opportunity; China’s inclusion can change the game altogether. It is possible that China applied for observer status in the SAARC due to this potential. The challenge facing the leaders of SAARC member countries is to materialise the enormous potential for the betterment of the people of the region. South Asia is the least integrated region in the world with the lowest intra-regional trade. There is a pressing need for a speedy implementation of the South Asian Free Trade Agreement.

South Asian regionalism has been suffering due to bilateral tensions and differences between the member countries. The region has a long history of conflicts, especially between India and Pakistan – who have fought four wars since 1947. Though the India-Pakistan rivalry is often blamed for SAARC’s failure, the reasons are in fact deeper and structural in nature. The geographical, ethnic, historical and political factors have gridlocked SAARC and will persist unless India adopts proactive confidence-building measures.

One of the major reasons for the failure of SAARC is that one of its members is much larger than all of its other members put together. India accounts for over 60 per cent of SAARC’s geographcical area, population, GDP, foreign exchange, gold reserves and armed forces. The huge resource and power imbalance generates an acute sense of insecurity among the member countries. Moreover, its relationship with the second largest member, Pakistan, causes polarisation instead of regional harmony owing to their historical conflict. Similarly, India shares boundaries (land and/or maritime) with all the member countries while they, (barring Pakistan and Afghanistan) do not share boundaries with each other. The existing unsettled border disputes and increasing conventional conflicts with India has increased a sense of insecurity among its neighbours.

Another important factor that hinders regional cooperation is the variation in their political beliefs. South Asia has witnessed all types of political systems – democracy, monarchy and dictatorship. India being the matured democracy and propagator of democracy in the region created asymmetry in political dealings among the member countries. Insecurity and distrust among the member countries forced smaller member countries to bandwagon with external powers (or other member countries) to balance India – thus hampering regional cooperation.

Modi’s invitation to the heads of governments of the SAARC member-states to his swearing-in ceremony was perhaps a signal that under his tenure as the prime minister, India would prioritise its neighbourhood. He visited Bhutan and Nepal and shared India’s desire to establish a SAARC satellite. One has to wait and watch if Modi would be able to fulfill those promises.

In order to revive the SAARC, one or more member countries can take initiatives to reduce distrust and insecurities among the member countries. Similarly, like-minded SAARC countries can form a sub-regional group and enjoy the benefits of regional cooperation. But cooperation in the sub-regional group which includes India will have limited cooperation within SAARC, while a sub-regional group that does not include India will suffer from a lack of contiguity and capacity constraints. India, being the largest economy of South Asia should show its benevolence and bear the cost of rejuvenating the SAARC for promoting regional cooperation in the region. Despite of the discouraging past, there is optimism among the member countries as all the South Asian countries have adopted democracy and are realising the benefits of regionalism.

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#4684, 6 October 2014
China in Nepal: Increasing Connectivity Via Railways
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

China is steadily extending its reach into South Asia with its growing economic and strategic influence in the region. It has huge trade surpluses with all South Asian countries and it reciprocates these surpluses with massive investment in infrastructural development, socio-economic needs and energy production in those countries. It also provides them with low-cost financial capital. The largest beneficiaries of such economic assistance are Pakistan, Bangladesh, Sri Lanka and Nepal.

Due to China’s rising interest and influence in South Asia, India appears perplexed. Hence, it has changed its foreign policy gesturing. With the election of Narendra Modi as the Indian prime minister, New Delhi has given highest priority to its South Asian neighours. Inviting the heads of the South Asian countries during his swearing-in ceremony and making his first foreign visit to Bhutan and later to Nepal are the clear indications in those directions.

China’s Inroads in Nepal
Given the claims that Nepal may be used by the US for its larger strategy of encircling China, Beijing is concerned about Kathmandu being manipulated by other external powers. Security experts on China state that Beijing increased its interest in Kathmandu due to the perceived threat to Tibet via Nepalese territory – particularly due to the prolonged state of instability and transition in Nepal.

Ever since the March 2008 uprising, when the Tibetans strongly started the global anti-China protests on the eve of the Beijing Olympic Games, there has been a major shift in China’s policy towards Nepal.

The Nepalese King, the then Commander-in-Chief of the Nepalese army, used to be China’s trustworthy partner and served Beijing’s security interests. However, after Nepal became a republic in 2008, China found it expedient to cultivate the Maoists to do the same. They wanted to curb underground activities of the approximately 20,000 Tibetan refugees settled in Nepal. Ideological affinities made Maoists in Nepal cast sympathetic eyes on China. China accepted the friendly hand extended by the Maoists when they were in dire need of support from a strong power. The former Prime Minister of Nepal, Prachanda’s, acceptance of China’s invitation to attend the closing ceremony of the Beijing Olympics not only made him the first prime minister to break the tradition of making India the destination for the first foreign visit following assuming office, but also proved his inclination towards China.

Maoists view India and the US as ‘imperialist powers’ and have stated that they were fighting against their interference in Nepalese politics.

India expressed serious concern over Prachanda’s action. The Indian media went overboard stating that India has lost Nepal from its sphere of influence and that it would affect India’s security in the long run. Interestingly, China supported the Maoist Party only after they emerged as the single largest party in the Constituent Assembly election of April 2008, while, it was the only country to supply arms to King Gyanendra to suppress the Maoist insurgents at a time when India, the US and the UK had refused to provide help of such nature.

Linking Via Railways
China is planning to extend the Qinghai-Tibet Railway to Nepal by 2020. The rail link is expected to be extended to the borders of India and Bhutan as well. Through Qinghai-Tibet Railway, China connected its existing railway system to Tibet’s capital Lhasa in 2006 – which passes through challenging peaks on the Tibetan highlands, touching altitudes as high as 5,000 meters as part of government efforts to boost economic development in the neglected region. In August 2008, six additional rail lines were proposed to connect to Qinghai-Tibet railway – such as the Lhasa-Nyingchi and Lhasa-Shigatse in the Tibet Autonomous Region, the Golmud (Qinghai province)-Chengdu (Sichuan province), Dunhuang (Gansu province)-Korla (Xinjiang Uygur Autonomous Region), and the Xining (Qinghai Province)-Zhangye (Gansu). The project is expected to be completed before 2020 while the Lhasa–Shigatse segment was completed in August 2014.

The Lhasa-Shigatse segment extends over 253 kilometers, carrying trains at 120 kmph through valleys and over three bridges that run across the Brahmaputra River. The opening of this segment has reduced the travel time from Lhasa to the remote border towns of Tibet by half. This particular railway line is to be extended to Rasuwagadhi in Nepal via the Shigatse-Kerung stretch. Rasuwagadhi is about 500 kilometers from Shigatse. It is also reported that the link will have two separate extension points, one with the Nepal border and the other with the borders of India and Bhutan.

Shigatse is an important monastery town, home to the Tashilhunpo monastery that has been the seat of the Panchen Lamas, and is an important centre of pilgrimage for many Tibetans.

In response to the Chinese attempt to extend the railway link from Tibet to the Nepalese border, Kathmandu has drafted a plan to extend its railway links to Nepal. Simultaneously, India has announced assistance worth Rs. 10.88 billion for the expansion of railway services in five places along the India-Nepal border.

Though Chinese claims that the rail network expansion will be crucial in economic, cultural, and tourism promotion in South Asia, it has alarmed New Delhi because of its strategic implications. While Nepal is shares a common dream of extending the railway line to Lumbini, the birth place of Lord Buddha, through Kathmandu, there is sign of nervousness among the Indian government due to the possible threat. Such fear might gradually fade after Modi’s invitation to the Chinese to fulfill his ambitious bullet train plan.

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#4652, 10 September 2014
India-Nepal Hydroelectricity Deal: Making it Count
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

With just two weeks left to seal the deal, the government of Nepal has formed a seven-member task force headed by Energy Secretary of Nepal to finalise the Power Trade Agreement (PTA) with India, and the Project Development Agreement (PDA) with Indian company GMR for Upper Karnali. The meeting of the Council of Ministers has authorised the team to hold dialogues with political parties of Nepal and forge consensus on the issue. The team has the drafts of the agreement presented by both the sides, as well as their reservations. The final agreement will be prepared after considering both drafts. The authorised team arrived New Delhi for negotiations on 3 September.

The PTA and PDA were expected to be signed during Indian Prime Minister Narendra Modi’s official visit to Nepal from 3-4 August. Citing the lack of enough deliberation, Nepal and India bilaterally decided to finalise the deals within 45 days. Unfortunately, not much progress has been seen in last one month.  

On 18 August, the Nepalese parliament’s Water Resources Committee asked the Energy Ministry to produce every document related to PTA, together with Nepal government’s June 2014 response to an earlier Indian proposal. The Committee also instructed the energy minister to present a progress report on the proposed agreement in the parliament. Media reports state that India had refused Nepal’s proposal – in PTA draft – for allowing investors from Nepal, India and other countries to trade power without any obstruction in both India and Nepal, as well as the permission to sell electricity generated in Nepal to the third countries through India.

If the project is completed on time, the 900 MW Upper Karnali Hydroelectric Project would generate dividends worth approximately $33 million from equity, royalty and free electricity throughout the concession period of 25 years. It is being constructed by the GMR Group, an Indian company, and will be handed over to the state-run Nepal Electricity Authority (NEA) after 25 years. Since it is being constructed on BOOT (build, own, operate and transfer) basis, the NEA will not have to share the project’s financial burdens.

The Investment Board Nepal, the government body overseeing the implementation of the Upper Karnali Project, has been negotiating the PDA with the GMR since April 2013. Additionally, a 13-member high-level committee that was formed under the National Planning Commission to deliberate on the draft PDA, raised two major concerns: First, the impact of the Upper Karnali project on the Rani-Jamara-Kuleriya and the Rajapur-Surya Patawa irrigation projects that are being constructed in Bardiya downstream of the project; and second, providing the cash incentive of approximately $51000 for every megawatt of electricity the project generates.

The first issue was addressed after the committee members agreed to deploy a team to conduct a study within six months of signing the PDA. But there some of the members of the committee held apprehensions on the proposal of giving cash incentives to an export-oriented project like Upper Karnali. They opposed on the grounds that such incentive should only be given to projects that generate electricity for domestic consumption.

Nepal should not get entangled in the issue of whether any sort of incentive should be given to an export-oriented hydropower project. Even if such a one-time incentive of $51000 is provided for every megawatt of electricity the Upper Karnali will produce, the government will lose only $400 million – which is an insignificant amount compared to the huge benefits the project will bring by harnessing the country’s water resources. The government must not waste time and energy on such minor issues that will ultimately be detrimental to the development of the Upper Karnali – and that will also set a precedent for other projects to be built with foreign direct investment.

Besides the PDA on the Upper Karnali, the government should also accelerate the process of signing a deal on the proposed PTA with India at the earliest, so that both Nepal and India can benefit mutually. Nepal has to sign this deal to send positive signals to the international market and to create an appropriate atmosphere to attract investments in the hydropower sector – crucial for the development of the country’s energy sector. The PTA will allow Nepal to import as much electricity as it needs when production falls and export power when there is surplus. Similarly, the signing of the PDA would demonstrate Nepal’s openness to investors who want to build export-oriented hydroelectric projects and pave the way for the government to generate income through royalties.

There are minor dissensions against the deal from the small leftist parties such as the CPN-Maoist. Reports also state that some senior leaders of the CPN-UML are against the deal but they have not made any comment – thereby giving tacit approval. India should also demonstrate a flexible approach to the deal. Signing immature deals in the past has not served any purpose. Hence, it should address Nepal’s genuine concerns whereby a conducive atmosphere for such similar future deals is created. The formation of a taskforce headed by the energy secretary is a welcome step towards the signing of a power trade agreement with India.

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#4563, 14 July 2014
Federalism and Nepal: Internal Differences
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

The constitutional debate in Nepal has bene caught up in peculiar twists and turns ever since late 1940s. So far, Nepal has had six constitutions, at different points in time, and the debate to get an acceptable constitution for long-term social peace and stability continues.

Why have constitution debates been unable to bring social peace and political stability in Nepal? Why have federalism debates in Nepal been so polarised that Constituent Assembly (CA) I was dissolved and elections to CA II were held to draft a constitution?  There are two simple questions to deconstruct the question of federalism in Nepal. First, why do historically marginalised communities (Madhesis, Janjatis, dalits etc) that constitute almost 70 per cent of the Nepal’s population strongly sympathise with federalism? Why are the Caste of High Hill Elites (CHHE) (Brahmins and Chettri etc) who are dominant in Kathmandu’s power structure are oppose federalism in its true spirit and agreed on a federal model of governance only after the large-scale Madhesi movement in 2007? 

Why is the Federalism Narrative So Dominant In Nepal? 
Nepal has been monolithic, upper caste hill-centric dominance of one language, culture, and an extremely centralised power structure of governance throughout history. However, the diversity in languages, cultures and a sense of belongingness that exists in Nepal has not been given due recognition; and the State’s discrimination and exclusionary policies triggered a sense of deep dissatisfaction among the historically marginalised community.

In this context, on the basis of ‘unity in diversity’, federalism narratives gained prominence to institutionalise self-rule, autonomy, and dignity in the country. This brings us to the debate of ‘identity–based’ federalism that is largely the politics for recognition of diversity in Nepal for these communities. 
What are the Technicalities of the Federalism Debate?

The debate on federalism has become one of the most contentious issues in Nepal. This polarised debate is approached via various perspectives, such as: change (pro-identity based federalism) Vs. status quo forces (federalism on the basis of viability); pluralist Vs. Mono-culturalist; historically marginalised communities Vs. upper caste hill dominance; and political de-centralisation Vs. administrative de-centralisation. By and large, the new political forces that emerged in Nepal after the promulgation of the 1990 constitution – like Maoists and various political parties that arose from social movements of Madhesis, Janjatis etc. –  associate themselves with the former while traditional parties like Nepali Congress and CPN-UML associate themselves with latter categories. 

This brings us to the technical debate on federalism, that, on the basis of the ‘Committee on State Restructuring and Allocation of State Powers’ during CA I agreed upon – “Identity based Federalism” and “viability,” i.e., on the basis of economic capability. There are five indicators for “Identity” – ethnicity, language, culture, geography and regional continuity, and historical identities ( historically subjected to discrimination in various forms in their homeland). The “viability” has four indicators – economic interrelationships and capability; status and potential for infrastructural development; availability of natural resources; and administrative feasibility.

Complexities of the Federalism Issues in Nepal 
The technical details are no less complex, adding complexities to the issues in the federalism debate. However, there exist battles of narratives regarding the debate on federalism. It is alleged that the status quo forces try to obfuscate the federalism debate to benefit the CHHE and curve out federal lines of a new Nepal in ways that give demographic advantage to ruling elites and maintain dominance in Kathmandu’s power structures. Conversely, the status quo forces allege that the pro-identity-based federal forces support single identity ethnic based federalism. However, Nepal is a multi-ethnic, multi-lingual nation and it is not possible to have a majority of any single ethic group in any model of federalism. The only difference that adds complexities is the devolution of power from dominant elite’s high hill castes to pave Nepal’s transition towards inclusive citizenship and recognition of marginalised communities, identities, culture and self-rule. 

Perhaps, the buck stops at the top leaders of the political parties in Nepal who are all traditionally ruling high-caste Brahmins to strike constitutional agreement. And, the rationale choice has to be made on ways to delegate power from the hill upper caste elites to the people who have been historically marginalised and such choices are more difficult given how CA I winners are losers in CA II elections. 

Is Nepal Postponing the Inevitable? 
Nepali politics is in transition and fast-changing its state characteristics from a monarchy to a republic; a Hindu state to a secular one; and a unitary structure towards an inclusive federal model of governance. The CA I postponed federalism issues for the CA II despite marginalised communities united and had adequate support base of 2/3rd majority – that includes the aspiration of identity and viability model of federalism denouncing 14 state models of federal governance.

If Nepal postpones the identity criterion of federalism, the constitutional debate will be likely to be endless – merely postponing the social peace and stability. The constitution is the document of compromise and the debate to make the new Nepal inclusive must ensure the aspiration of historically marginalised people towards making the people equal, and simultaneously not making them unequal via federalism.

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#4486, 2 June 2014
Modi and Nepal-India Relations
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

Narendra Modi’s thumping victory with 282 Lok Sabha constituencies, making him the Indian Prime Minister generated vibes throughout the region. His invitation to the heads of governments of the South Asian Association for Regional Cooperation (SAARC) member-states to his swearing-in ceremony was an unprecedented move – perhaps a signal that under his tenure as the prime minister, India will prioritise its neighbourhood. It would be interesting to observe what Modi’s victory means for the region in general, and for Nepal in particular.

Modi’s Neighbourhood Policy
The BJP, in their manifesto, assured that they would pursue friendly relations with all of India’s neighbours but would not hesitate from taking firm stances and strong steps. It was a clear signal to neighbours that they would not compromise on issues of terrorism and national security. Modi’s image as a decisive leader and his party’s ‘nationalist’ stand indicates that Modi would be different from the previous governments India has had. However, his efforts would be visible only if he comes with proper homework, revive the SAARC and facilitate the implementation of the SAFTA – the regional free trade agreement, during the SAARC summit to be held in Kathmandu in November this year. Since its establishment in 1985, the SAARC has made no progress due to the perpetual disagreements between India and Pakistan – despite the fact that the SAARC charter forbids member-countries from bringing bilateral issues to the table.

Many experts predict that Modi’s foreign policy priority would be South Asia (particularly improving relations with Pakistan) followed by China and the US, while others believe that China and South Asia would be lowest in his list of priorities as compared to the US, Japan and other strategic partners. After Modi’s rise, some media called him the “Shinzo Abe of India” while the westerners fear him as the “Indian Putin.” Many believe that he might emerge as the “Indian Deng Xiaoping.” Time will tell which name plate matches Modi best. However, Modi will have a proactive foreign policy, possibly one driven by economy.

Modi and Nepal-India Relations
Nepal-India relations have always been cordial, strong, and have stood the test of time. The two countries are so inextricably intertwined by means of geography, history, culture, religion and tradition that a change in government in either country would not affect the warmth of their bilateral relations. Many believe that there would be no fundamental shift in India’s policy towards Nepal under Modi’s regime, but it is likely that Nepal will get more attention, and that interaction between New Delhi and Kathmandu will increase. Interestingly, his first public statement on foreign affairs was about Nepal, on Twitter, where he said he was committed to strengthen relations.

Modi’s prime minister-ship has added anxiety among those Nepalese who stand for a secular and republic Nepal. They fear that Modi’s government, whose leaders had openly expressed unhappiness after Nepal was declared a secular and republic country, might encourage the hard-line Hindu party and pro-Hindu forces of Nepal to fight for the Hindu Kingdom. However, many neglect such fears as Modi is the Prime Minister of a democratic India whose own constitution calls it a “Secular Democratic Republic.” Thus, Modi’s government would not try to fiddle with these aspirations of Nepalese; and instead it would concentrate on building stronger economic ties. He would refrain from supporting hard-line forces in Nepal, irrespective of their ideological and religious persuasions.

‘Secular’ and ‘Republic’ were the two demands agreed by the political parties of Nepal to bring Maoists in the peace process, and those which were later reaffirmed by the People’s Movement of 2006. India facilitated the process as it was in its security interests. A small faction in Modi’s party still believes that a ‘Hindu Kingdom’ can be brought about but they fear the revival of another armed conflict by the Maoists. Hence, India would not make attempts at such adventurism as it would hurt its prime concern – security. Moreover, during the bilateral meeting between Indian Prime Minister Narendra Modi and Nepal’s Prime Minister Sushil Koirala, the former assured the latter that New Delhi had no interest in interfering in the issue of secularism in Kathmandu; and that India would in fact help Nepal in its development.

Modi promised ‘development and governance’ to the people of India during his campaign, which verifies his focus on economic development. The Nepalese economy too can reap the benefits because it is closely linked with the Indian economy. For this, Nepalese political parties need to sort out their differences; write the constitution on time; take meaningful steps towards political stability; and refrain from over-politicising its policy towards India by developing a national consensus, so that internal power struggle does not affect Nepal’s foreign policy priorities.

Similarly, India must give greater political recognition and priority to its Nepal policy because of its unique relationship and security implications. The best way Modi could earn India some goodwill in Nepal is by letting the constitution-writing process take its own course and refrain from actively dictating terms, and/or micro-management, like the previous government did.

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#4382, 7 April 2014
Nepal's Restful Prime Minister
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

It has been over two months since Sushil Koirala took office as the Prime Minister’s of Nepal. In last two months, Koirala promoted six joint secretaries to secretaries and appointed Damodar Prasad Sharma as the new Chief Justice of the Supreme Court.

Despite the election of the second Constituent Assembly (CA) in November 2013, the CA has not got its full house, as 26 CA members remains to be nominated. The CA committees that were formed to accelerate the constitution-making process still do not have chiefs, and are yet to start operations. of the rate of progress of the past two months has raised doubts regarding the timely delivery of the new constitution.

Koirala’s slow pace has also raised serious doubts over the prospects of local elections that the governing parties had earlier vowed to conduct within six months of the CA elections. Since the election is now virtually impossible in the said time-frame, the government might schedule it after the constitution is promulgated, and has been confirmed by Deputy Prime Minister Prakash Man Singh. This is in the interest of the country as the leaders can direct their focus completely on the constitution-making process.  

Koirala’s government is yet to get a definitive shape. He is struggling to appoint officials to the several important positions lying vacant in the administration, judiciary, foreign service, and security. Almost half a dozen ministries currently do not have ministers assigned, and eight slots for the position of Secretary remain vacant. The government is yet to appoint over a dozen ambassadors for different embassies around the world. According to media reports, 12 ambassadors will retire in the next five months. Even important missions, such as the Embassy of Nepal in New Delhi have been functioning without ambassadors, since December 2009. 

Koirala has failed to appoint a complete team of advisors since he took office. He is also unable to orchestrate efficient coordination between the Prime Minister’s Office and other ministries.  Due to the long-standing delay in filling the vacant positions of the second-most powerful institution of the country’s security force, the functioning of the Nepal Police has been badly affected. The government hasn’t demonstrated any urgency to end the delay in promoting Deputy Inspector Generals of Police (DIG) to the vacant Additional Inspector General of Police (AIG) positions. There are several other issues the Koirala government needs to resolve immediately, for the delay has negatively affected the delivery of service to the people.

The snail’s pace and indecisive behaviour of the prime minister has been criticised by all quarters. Such harsh criticism about Koirala been made both by external analysts as well as the members of his own party.  Madhav Kumar Nepal, Senior Leader, Communist Party of Nepal-Unified Marxist Leninist (CPN-UML), pointed towards Koirala’s lack of experience in governance as the reason for the slow pace, and further stated that the latter is somebody who would easily get frustrated with the problems.

Before being elected as the Prime Minister, last February, Koirala served only for the party at various levels. He joined the Nepali congress in 1954 and spent 16 years in political exile in India after King Mahendra suspended the constitution, dissolved parliament, dismissed the cabinet, imposed direct rule and imprisoned then Prime Minister Bishweshwar Prasad Koirala and his closest government colleagues in December 1960. Koirala has also spent three years in Indian prisons for his involvement in a plane hijacking in 1973. He has been a member of the Central Working Committee of the party since 1979 and was appointed as the General Secretary of the party in 1996. He was promoted to Vice President position in 1998 and is has been the president of the party since 2010.

Undoubtedly, the 75–year-old Koirala is honest, sincere and known for his simple life. Last month, Koirala also got international coverage claiming him world’s poorest head of state. According to the Office of the Prime Minister and the Council of Ministers that disclosed the assets of top government officials including Koirala and the members of the Council of Ministers, the only assets of the prime minister are three mobile phones.

The past two months under Koirala’s tenure has not been all that bad either. He managed to get all the parties agree to own up all the achievements and agreements of the last CA. The house also prepared a schedule for the constitution-making process. All he needs to do now is to enforce the schedule. He should change the functioning system of his office, and carry out all the appointments without delay. Instead of opening new doors of confrontations and obstacles, he needs to concentrate on ways that can give Nepal its constitution in a timely manner. The rescheduling of local election after the constitution promulgation is a positive move. 

He has wasted enough time by visiting temples, traveling across the countries, visiting his own constituency, and leaving the major tasks aside. He cannot afford to lose anymore. 

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#4319, 3 March 2014
Chinese Inroads to Nepal
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

Over the recent months, China, in an attempt to strengthen its relations with the South Asian Association for Regional Cooperation (SAARC), has been taking efforts to build a close-knit strategic alliance with Nepal. At a meeting with a visiting delegation of Nepali parliamentarians, Liu Zhenmin, Vice Minister of Foreign Affairs, China, stated that Nepal´s role as the host of the upcoming SAARC summit will be instrumental in augmenting Chinese ties with the South Asian regional bloc.

Nepal and China also revised the bilateral Air Services Agreement (ASA), permitting the increase in the number of flights per week between the two countries to 56 from 14 –considered a major boost to the Nepal-China economic cooperation in various areas. Additionally, under the revised pact, an additional seven flights per week will be added annually to amount to 70 flights per week by 2016.

Ever since the March 2008 uprising, when the Tibetans strongly started the global anti-China protests on the eve of the Beijing Olympic Games, there has been a major shift in China’s policy towards Nepal. The King of Nepal, a longstanding strategic partner of China, used to serve the Beijing’s security interests. After Nepal became a republic, the unprecedented visits by Chinese government officials and members of the communist party have further grown, especially. in last few months. Nepal has hosted high ranking officials such as the Vice-Minister of the Communist Party of China’s (CPC) International Department, Ai Ping, State Counsellor Yang Jiechi, and the Vice-Chairperson of the Standing Committee of the CPC, Yang Jungi, in the past five months alone. Media reports state that on an average, at least two Chinese delegations visit Nepal every month.

Given the claims that Nepal may be used by the US for its larger strategy of encircling China, Beijing is concerned about Kathmandu being manipulated by other external powers. Security experts on China state that Beijing increased its interest in Kathmandu due to the perceived threat to Tibet via Nepali territory – particularly due to the prolonged state of instability and transition in Nepal, and the recent change in China’s neighbourhood policy following the accession of the new leadership.

However, after Nepal became a republic in 2008, China found it expedient to cultivate the Maoists to serve its security interests. They wanted to curb the underground activities of the approximately 20,000 Tibetan refugees settled in Nepal. Ideological affinities made Maoists in Nepal cast sympathetic eyes on China. China accepted the friendly hand extended by the Maoists when they were in dire need of support from a strong power. Former Prime Minister of Nepal, Prachanda’s, acceptance of China’s invitation to attend the closing ceremony of the Olympics not only made him the first Prime Minister to break the tradition of going to India as first foreign visit following assuming the office, but also proved his inclination towards China. Maoists view India and the US as ‘imperialist powers’ and stated that they were fighting against their interference in Nepalese politics.

India expressed serious concern over Prachanda’s action. Indian media went overboard stating that India lost Nepal from its sphere of influence and that it would affect India’s security in the long run. Interestingly, China supported the Maoist Party only after they emerged as the single largest party in the Constituent Assembly election of April 2008, while, it was the only country to supply arms to King Gyanendra to suppress the Maoist insurgents at a time when India, the US and the UK had refused to provide help of such nature.

India- China Competition and Rivalry
The competition for influence between China and India along the Nepal-China border is not a new story. The development assistance of Rs. 100 million provided by India for Nepal’s remote hilly region of Mustang was followed by a financial assistance worth Rs. 10 million for the construction of a library, a science laboratory, and school building with computers in Chhoser village (adjacent to Tibet’s Jhongwasen district), in the same region, by China. Subsequently, the ambassadors of both countries have visited the region.

There are reports of China funding and promoting China Study Centers, mostly along the India-Nepal border. In February 2009, China proposed and submitted the draft of a new ’Peace and Friendship Treaty’ to Nepal.  The then Prime Minister Prachanda was supposed to sign the treaty on his China visit, but was obliged to resign over the issue of the Chief of Army Staff, prior to his scheduled visit.

India, in response to the Chinese attempt to extend the railway link from Tibet to the Nepalese border, has drafted a plan to extend its railway links to Nepal. India has announced assistance worth Rs. 10.88 billion for the expansion of railway services in five places along the India – Nepal border. The first phase of expansion is scheduled to begin from Birgunj in Nepal which is about 350 kilometers south of Tatopani, the place which is to be connected by China via railway lines. The power-game between China and India is thus slowly unfolding in Nepal.

Nepal’s position has become more strategically significant with the rise of a China that is aiming to be a superpower. Situated between the two regional powers who aspire to be global players, Nepal can grab the opportunities and become a center of geopolitical competition between the rising China and a defensive India. A stable Nepal is in the interest of both India and China as it serves their prime concerns – security.

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#4288, 3 February 2014
Constituent Assembly-II: Rifts Emerging
Pramod Jaiswal
SAARC Doctorate Fellow, Centre for South Asian Studies, JNU

In the words of Aristotle, “Well begun is half done.” However, the second Constituent Assembly (CA) of Nepal is getting hiccups right from the beginning. The political parties do not seem to have learned much from the past. Though almost all the political parties agree on readying the first draft of the constitution within a year, the hardening fact remains that the debate on the constitution is not likely to be deliberated for six months as it has taken almost a month to decide who can legitimately call the Assembly.  Therefore, it is likely that another month will be taken for the formation of the Council of Ministers and nomination of twenty six members that will provide a fuller shape to the CA. Inter and intra-party differences are the major reasons that have handicapped constitution-writing.

Inter and Intra-Party Differences
In Nepali Congress, Sushil Koirala became the parliamentary party (PP) leader, defeating Sher Bahadur Deuba, as the party failed to forge an agreement even after several rounds of talks. Deuba had asked for the post of acting president of the party in order to support Koirala. Ram Chandra Paudel made the same claims. This unfolded the three-sided rift in the NC.

The CPN-UML is in a similar crisis where all four senior leaders are eying the post of party chairman in the next general convention, scheduled for April 2014. The standing committee meeting decided to elect its PP leader through vote as the party could not nominate one through consensus. Most likely, KP Oli will make the way for the PP leader by defeating Jhalanath Khanal as he is trying to get the support of Bamdev Gautam. Although Gautam has been a trusted partner of Khanal for the last five years, he will be a game-changer in this election.

After being dissatisfied with the proportionate candidate selection row, two senior leaders of UCPN-Maoists, Baburam Bhattarai and Narayankaji Shrestha, accused Prachanda for the election setback. Bhattarai even asked Prachanda to handover leadership to the younger generation. Ruling out the chances of power handover during a ‘crisis’, Prachanda announced the holding of conventions to restructure and shape the political ideology of the party.

However, the breakaway faction led by Mohan Baidya has threatened to launch protest programmes if the major political parties keep turning a deaf ear to his demand for the dissolution of the CA. There are some speculations that both the factions might merge.

After the humiliating defeat of Madhesi parties, the prime reason being multiple splits, three major parties are working for unification. Madhesi Janadhikar Forum-Nepal led by Upendra Yadav, Tarai Madhes Loktantrik Party led by Mahanta Thakur and Sadhbhawana Party led by Rajendra Mahato are close to the unification process. The united alliance will be the fourth largest party in the new CA. Madhesi Janadhikar Forum-Loktantrik led by Bijaya Gachhadar is also inviting other Madhesi parties to join him to further polarise the political alliances.

Rastriya Prajatantra Party-Nepal (RPP-N) barely escaped the sword of split. Tanka Dhakal and other dissenters accused the party chairman of putting the agenda of ‘monarchy’ on the back burner, neglecting the issues of nationalism, being pro-India, and promoting nepotism and favoritism during appointment of PR seats.

Differences on Constitution Issues
The three major political parties have agreed to have a draft of the constitution within a year. The previous CA had agreement on almost 85 per cent of the issues except the two major contentious ones - federalism and forms of government. However, these issues could not find a space in parliament in January 2014 due to the opposition by minor parties like RPP-Nepal.

The major parties should expand to include members from Madhesi and other smaller parties so that there can be broader support for the eventual agreements and at the same time face down the opposition. Effort should be made to have consensus on all the issues, but it would be a dream to expect actual consensus will be reached. It would also be futile to hope for the voices of resistance to die down if the motion is delayed. Not much progress has been made since December 2013 so the political parties should not waste much time if they are serious about a timely constitution. They should also try to avoid new fronts for confrontations such as elections of the president and vice-president. Even if it occurs, they should come up with appropriate solutions. Meanwhile, they should form the government urgently, preferably within the deadline given by the president. It is the need of the hour for all political parties to come together and forge consensus, failing which they must chose voting in order to ensure a timely constitution.

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#4236, 6 January 2014
Nepal: The Crisis over Proportional Representation and the RPP Divide
Pramod Jaiswal
SAARC Doctoral Fellow, JNU

Last year (2013) was lucky  for the Rastriya Prajatantra Party-Nepal (RPP-N) led by Kamal Thapa as they emerged as the fourth largest party in the second Constituent Assembly (CA-II). But in 2014, the party seems to be sailing through rough waters. 
The RPP: Through Splits and Mergers 
Like all the political parties of Nepal, RPP also has witnessed splits and mergers. The RPP formed following the overthrow of the Panchayat system in 1990, was a party of the political elites of the Panchayat system who favors the revival of the royalty. Due to minor differences within, two separate organizations with identical name contested in 1991 elections. After the humiliating defeat both factions merged; in the 1994 election, united RPP secured 20 (out of 205) seats and emerged as the third largest party in the hung parliament.  In 1997, the RPP faced another split after a faction led by Chand joined a coalition government with Communist Party of Nepal (Unified Marxist-Leninist), with Chand as Prime Minister. The faction led by Thapa allied with Nepali Congress and toppled the UML-RPP government. RPP-Chand and RPP-Thapa were reunited after both factions fared badly in the 1998 election. In 1999 elections, the unified party won 11 seats.

The party split again in 2005 when Thapa, former party chairperson, broke away and formed Rastriya Janashakti Party (RJP). RPP then suffered another split, with Kamal Thapa forming his own party, RPP-Nepal. Rajeshwor Devkota had formed another Rashtriya Prajatantra Party (Nationalist) which eventually merged into RPP- Nepal in 2007.  In the 2008 CA election, RPP won 8, RPP –Nepal won 4 and RJP won 3 seats out of 601. But just before the CA-II election of 2013, RJP merged again with RPP and got 10/601 seats. 

Post 2013 Elections: RPP and the Nepali Rastriya Prajatantra Party 
After 2013 elections, today all major political parties are facing a crisis on issues relating to the selection of candidates under the Proportionate Representation (PR). RPP-Nepal escaped from the verge of split but couldn’t remain immune to stay intact. Tanka Dhakal along with 19 Central Committee members announced (in December 2013) to split and register a new party ‘Nepali Rastriya Prajatantra Party”.  ‘Hindu State and Monarchy’ as the prime agenda in their manifesto while ruling out federalism, RPP-N made a massive increase from mere four seats (in CA-I) to 24 (in CA-II). 

RPP-Nepal is the only party in Nepal that wants to make Nepal a Hindu state again. Thapa stated, “Ethnic federalism, secularism and republicanism were the result of a conspiracy between the foreign powers and the country’s extreme left and a part of their strategic alliance. The political parties, intellectuals and media all submitted under foreign pressure”.  He had emphasized that his party would be flexible on monarchy during constitution writing but would not sacrifice the fundamental elements of a Hindu nation.

Reasons behind the recent split within the RPP
The following could be put forward as reasons behing the recent split:

Agenda of Monarchy: Dhakal and other dissenters have accused Thapa of putting the agenda of ‘monarchy’ at the back burner. He was blamed for sidelining pro-monarchy supporters because of his remarks that election’s mandate is for ‘hindu state’ and the issue of monarchy could be compromised on. 
Issues of Nationalism: The dissenters have criticized Thapa for neglecting the issues of nationalism. With his frequent visits to Indian leaders, they further accuse him of changing into ‘Pro-India’ while he used to criticize the ‘Indian interference’ in Nepal’s internal matters such as Indian involvement in facilitating the Comprehensive Peace Accord in Delhi which led to the end of Monarchy.  The dissenters dubbed the party under Thapa as ‘Indian RPP-N’ and subsequently named their new party as ‘Nepali RPP’.

Leadership: The disgruntled faction has serious differences over the appointment of candidates under the PR system. Thapa has been accused of being autocratic, horse trading, and promoting nepotism and favoritism during appointment. He was accused for giving PR seats to his family members, Non-Resident Nepali and selling the seats to businessmen. 

Crisis over Proportional Representation: Implications for Constitution Making 
Like RRP-N, serious differences have surfaced in Maoists as well on the issue of PR candidate selection. It is yet to be seen how politics unfold in the RPP-Nepal but it’s clear that it will delay the constitution making process. Most likely, it will take time to convene the CA.  
Will the political parties remain intact and continue with most of the agreements reached in the last assembly? RPP-Nepal has stated that they would demand a fresh beginning. They claim there is no relevance of the agreements on constitutional issues sorted out by the last CA. 
It is in the best interest of all the political parties to accept the past agreements, hold parleys and forge new agreements on the remaining issues and promulgate the constitution within a year. Perhaps, it would be the most revered New Year gift for the Nepalese in 2015.

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