Political Developments in Nepal

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    Recently, Nepal SC asked the President to appoint Sher Bahadur Deuba as new PM of Nepal.

    About

    • The Supreme Court of Nepal in a dramatic verdict said Prime Minister K P Sharma Oli had violated constitutional principles.
    • Following this, he was removed.

    Recent Developments in Nepal

    • President’s Role: 
      • Nepal plunged into a political crisis December 20 last year after their President Bidya Devi Bhandari dissolved the House and announced fresh elections on April 30 and May 10 at Oli’s recommendation amid a power tussle within the ruling Nepal Communist Party (NCP).
    • House reinstated: 
      • Later, the apex court reinstated the dissolved House. Oli, currently heading a minority government, has often defended his move to dissolve the House saying some leaders of his party were attempting to form a “parallel government”.
      • Oli promised a regime with “zero tolerance to corruption” and committed to development, including building waterways connecting to India. But he failed to deliver – this dented his image and credibility.
    • Breaking of Alliance: 
      • Infighting led to the Maoist Centre breaking away from the alliance. Also, a powerful faction led by former Prime Minister Madhav Kumar Nepal rebelled within the UML challenging what it called Oli’s dictatorial style.
    • Latest Development: 
      • With the order clearing the stage for Deuba’s takeover, Nepal is likely to enter an unstable phase of coalition rule
      • Besides the 61 members of the Deuba-led Nepali Congress, the Pushpa Kamal Dahal-led Maoist Centre has 42 members. 
      • Twenty six dissidents from UML and about a dozen members of the Upendra Yadav-Baburam Bhattarai led faction of the Janata Samajwadi Party have supported Deuba, but it is not clear whether UML dissidents will join the coalition.

    India-Nepal Relations

    • Foundation of the relationship: 
      • Nepal and India enjoy excellent bilateral ties. 
      • Founded on the age-old connection of history, culture, tradition and religion, these relations are close, comprehensive and multidimensional and are pronounced more in political, social, cultural, religious and economic engagements with each other. 
      • The two countries established diplomatic relations on 17 June 1947. The unwavering commitment to the principles of peaceful coexistence, sovereign equality, and understanding of each other’s aspirations and sensitivities has been the firm foundation on which our bilateral relations have been growing further.
    • Safe and open borders: 
      • Nepal’s solemn desire to cultivate and foster the cordial and friendly ties with its neighboring countries are reflected in its long standing position of not allowing its territory to be misused by any elements inimical to India and also expects the same sort of reciprocity and assurances from her. 
      • The open border between the two countries remains a unique feature of our relations. 
      • Frontier without restriction has greatly facilitated the free movements of our people to each other’s territory and enhanced interactions.
    • Political Relations
      • There are frequent high level visits by the leaders of the two countries at different points of time and the interactions constitute the hallmark of the ties between the two countries. 
      • Furthermore, such visits have helped promote goodwill, trust, understanding and cooperation between the two countries and have injected fresh momentum to further consolidate age-old and multi-faceted bilateral relations of friendship and cooperation on a more mature and pragmatic footing.
      • Exchange of Visits has taken place between the top leaders of both the countries, many times. 
    • Common Organizations:
      • SAARC Summit.
      • Nepal-India Joint Commission.
      • International Conference on Nepal’s Reconstruction
      • BIMSTEC 

    Nepal-India Economic Relations

    • Advancing peace process and framing of Constitution: 
      • India has been a key development partner of Nepal. 
      • Nepal received strong support and solidarity from the people and Government of India in advancing its home-grown peace process as well as in the process of writing the Constitution through the elected Constituent Assembly. 
    • Humanitarian crisis help: 
      • Following the massive earthquakes in Nepal in 2015, India promptly offered helping hands. 
      • The Government of India has also been substantially supporting Nepal’s reconstruction efforts.
    • Increasing Assistance: 
      • The Indian cooperation started in 1952 with the construction of an air-strip at Gaucharan. 
      • Since then, India has been assisting primarily in the areas of infrastructure development and capacity development of human resources in Nepal. 
      • India’s economic assistance to Nepal has grown manifold in the past few decades, particularly since the restoration of multiparty democracy in Nepal in 1990.
    • Nepal-India Joint Oversight Mechanism:
      • A Nepal-India Joint Oversight Mechanism has been constituted co-chaired by the Foreign Secretary of Nepal and the Indian Ambassador to Nepal.
      • It reviews the progress made and resolves issues in the implementation of the projects under India’s economic and development cooperation. The Mechanism meets once every two months.
    • Agricultural expansion: 
      • Both sides have agreed to advance new partnership in agriculture, expand rail linkages connecting Kathmandu to Raxaul with India’s financial support, and develop inland waterways for the movement of cargo providing additional access to sea for Nepal. 
      • It has also been agreed to address outstanding matters in a stipulated time frame, with the objective of advancing cooperation in all areas.

    Recent Challenges in India Nepal Relations

    • Border Dispute: 
      • Tough to resolve: Though the chances of resolving border disputes in the immediate future appear slim, both countries can at least begin the talks focusing on border disputes.
      • Technical committee by Nepal: Nepal had formed a technical committee to analyse the already available proofs and collect more evidence to prove that Kalapani, Lipulekh, and Limpiyadhura belong to Nepal. The committee has claimed that it has come with sufficient evidence to prove that these territories belong to Nepal.
    • Amendments to 1950 Treaty:
      • EPG Report: The report of the Nepal-India Eminent Persons Group (EPG) report. The expert panel started its work in 2016 and completed the task in 2018 but both countries are yet to receive the report. India has not responded to the report positively and is reportedly unhappy with some of the provisions of the EPG report. 
      • India refusing to accept it: However, India is allegedly refusing to accept the report which has become an irritant in bilateral relations. The core of the EPG report is the amendment of the 1950 Treaty, which Nepal is consistently pushing for the last two decades. 
      • Article 2 of the Treaty: The 1950 treaty has several provisions such as Article 2 which states that the two governments have an obligation to “inform each other of any serious friction or misunderstanding with any neighbouring State likely to cause any breach in the friendly relations subsisting between the two Governments.”
    • Pancheshwar Multipurpose Project: There are some big development projects such as Pancheshwar multipurpose project which are awaiting approval as bureaucrats have failed to resolve the outstanding issues such as funding modality and others. 
    • Cross border movement of people: Since COVID 19 lockdown, borders between the 2 countries have been closed. People of India present in Nepal are facing issues and the cars with registered numbers of India are facing more problems.
    • Covid 19 and Vaccine:
      • Vaccine support to Nepal: Immediately after the Joint Commission meeting, India provided one million doses of Oxford-AstraZeneca’s CoviShield vaccine to Nepal as grant assistance to generate goodwill among the Nepalese people, which was manufactured by Serum Institute of India (SII), the largest producer of vaccines in the world. 
      • Appreciation from Nepal: The Oli government had appreciated India for this support.
      • China’s reaction: There is a feeling that India’s vaccine diplomacy gave a jolt to China, which was expanding its footprint all over South Asia, including in Nepal. As per some, China had assured Nepal of provision of the Sinopharm vaccine, but the Nepalese government has not yet been given permission for its import. 
    • Indian currency banned in Nepal: Indian notes of higher denominations such as INR 500 or INR 2,000 are still banned in Nepal, which causes difficulties for people while they travel to each other’s country.

    Way Forward

    • Maintain Trust: There is a need to build an environment of trust between the political leadership of the two countries. Nepal also needs to create a congenial environment in the country to enable India to complete its projects in Nepal on time. 
    • Government to Government relations: Even though Nepal-India relations are largely governed by people-to-people relations, the importance of government-to-government relations can no longer be underestimated. 
    • Bring Balance: Interdependence between Nepal and India is the secret to reset the relations between the neighbours. Since Nepal’s dependence on India is more than India’s dependence on Nepal, it is all the more necessary to balance such relations. To increase India’s dependence on Nepal, it is necessary to place the increase in trade and economic activities at the forefront. 
    • Enhance Connectivity: The focus should be given to more air, road, train, and waterways connectivity, apart from playing an active role in several important multilateral forums such as BBIN (Bangladesh, Bhutan, India and Nepal), BIMSTEC, NAM, and SAARC to serve their common interests.
    • Undertake Projects: There could be a breakthrough between the two countries if they agree on some big projects like Pancheshwar or initiate new projects. Nepal could further attract Indian investment in the hydropower sector in the Himalayan river system. Also, Indian companies in Nepal should be given adequate protection in the country.
    • Cultural Connect: Considering India’s economic and strategic importance for Nepal, Kathmandu needs to enhance cultural ties and people-to-people contact with India. 

    India’s Assistance

    • Flagship projects: B.P. Koirala Institute of Health Sciences, Dharan; Emergency and Trauma Centre at Bir Hospital, Kathmandu; and Manmohan Memorial Polytechnic at Biratnagar are some of the flagship projects completed and operationalized under the Indian assistance.
    • Integrated check-posts: have been proposed at four points on Indo-Nepal border namely 
      • Raxaul-Birgunj, (completed and operationalized from April 2018) 
      • Sunauli-Bhairahawa, 
      • Jogbani-Biratnagar and 
      • Nepalganj Road-Nepalgunj. 
      • The construction of ICP in Biratnagar is ongoing, while procedures are underway for Bhairahawa and Nepalgunj. 
      • Likewise, as envisaged by the MoU for the construction of Terai roads under phase I, the process of implementation has started.
    • In the International Conference on Nepal’s Reconstruction held in Kathmandu in 2015, the Government of India pledged a fund of US$ 250 million grant and US$750 million soft loan. Agreements have already been signed for both grant and loan. 
    • Cooperation in Water Resources
      • Water resources are considered as the backbone of Nepali economy. 
      • The issue of water resources has always been getting due prominence in the agenda of bilateral cooperation between Nepal and India for a long time. 
      • With a view to optimizing the benefits and addressing the problems, both Governments have set up three-tier mechanisms called 
        • Joint Ministerial Commission for Water Resources (JMCWR), 
        • Joint Committee on Water Resources (JCWR) and 
        • Joint Standing Technical Committee (JSTC) 
    • Power Trade Agreement: 
      • An important Power Trade Agreement was signed between the two countries in 2014 paving the way for the power developers of the two countries to trade electricity across the border without restrictions. Private/public power developers from India have reached agreements with the Investment Board of Nepal to develop two mega hydropower projects – Upper Karnali and Arun III.
    • Trade, Transit and Investment
      • India is Nepal’s largest trading partner. 
      • India has provided a transit facility to Nepal for the third country trade. 
      • Both public and private sectors of India have invested in Nepal. 
      • The trade statistics reveal a phenomenal increase in the volume of bilateral trade over the years between the two countries. 
      • However, Nepal has an escalating trade deficit with India. 
      • Nepal and India have concluded bilateral Treaty of Transit, Treaty of Trade and the Agreement of Cooperation to Control Unauthorized Trade.
    • Security Cooperation and Boundary Management
      • Security related issues are of prime concern to both the countries. 
      • To deal jointly with each other’s security concerns, the two countries have institutionalized Home Secretary level meetings and established the Joint Working Group on Border Management (JWG) and Border District Coordination Committees (BDCCs).
      • Nepal-India Joint Technical Committee formed in 1981 made important accomplishments in scientifically mapping Nepal India boundary. 
      • The Boundary Working Group (BWG) established in 2014 has taken over the technical works related to Nepal-India boundary. 
    • Multilateral and Regional Fora
      • Both Nepal and India have common approach to regional and multilateral institutions and hence, work in tandem in the United Nations, Non-aligned Movement and other international fora on most of the important international issues. 
      • Furthermore, both the countries have been deeply engaged in the regional and sub-regional frameworks of SAARC, BIMSTEC and BBIN for enhancing cooperation for greater economic integration by harnessing collectively the potentials and complementarities available in the region.

    Source: TH