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.

Conclusion
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.