Blockade: A blessing in disguise?

Murari Sharma

Nepali Foreign Minister Kamal Thapa has just concluded his China visit, issuing an 8-point understanding. The two countries have pledged to work towards a transit agreement, a long-term arrangement to trade in petroleum products, opening more border points, and facilitating greater trade between the two countries. It is a welcome development. However, what the Nepali people struggling for survival in the wake of the devastating earthquakes of April-May 2015, needed were fuel, medicine and construction materials now, not a promise for the future.

The Nepali people have been facing immense hardships now. No cooking gas, no petrol, no diesel, no kerosene. Shortage of medicines and construction materials. Schools and factories closed, lifesaving procedures halted, and development activities stopped, all owing to the lack of energy. The worst affected are the victims of the April-May 1915 earthquakes who have no roof over their heads, because construction materials are not available or have become unaffordable in the black market. It has created a serious humanitarian crisis.

At the root of this crisis is the blockade on the Nepal-India border, for nearly four months now. The blockade was triggered by the new constitution of Nepal, promulgated on 20 September 2015.

Several  Madhesh-based minor political groups boycotted the Constituent Assembly when they figured that their key demands were unlikely to be met in the new statute. Their demands, among other things, included one geographic state — and certainly not more than two — in the 22 plain districts, liberal naturalized citizenship, and apportionment of electoral constituencies based on population only.

India supported these demands openly. Its ambassador in Nepal lobbied the major political parties to accommodate those demands. New Delhi sent its Foreign Secretary to press the point two days before the new charter was adopted and promulgated.

The statute, approved by more than two-thirds majority of the Assembly, has provided for one state in the plains made of eight districts, one hill-only state, and other mixed states. It has allocated one constituency to each existing district and the rest based on population and barred naturalized citizen from holding the highest and most sensitive public offices. The disgruntled Madheshi groups went to the street against these provisions shortly after 20 September.

Since their agitation did not bend Kathmandu, the Madheshi groups began to picket those Nepal-India border points where they have significant influence. New Delhi restricted the flow of vital petroleum and pharmaceutical products and construction materials on all border points, even where there was no protest or picketing, and handed Kathmandu a 7-point non-paper outlining its demands for easing the supply situation. This is what has generated the major humanitarian crisis.

Kathmandu and New Delhi blame each other for this crisis. Kathmandu says India has imposed the embargo. The Nepali leaders are divided. Madheshi leaders, who wish to bend the government to their demands, assert that their picketing has caused the restrictions. Others blame New Delhi, citing obstacles in those plain districts as well where there is none or little disturbance.

Apparently, similar divisions exist in India. Prime Minister Narendra Modi’s government points its fingers to the Madheshi protests and picketing. But other players seem to disagree. Indian customs officials and border security forces tell their Nepali counterparts that they are restricting the flows on orders ‘from above.’ Opposition parties castigate the government for the utter failure of the government’s Nepal policy.

Speaking on a motion on the subject in the upper house of Indian parliament, key opposition speakers accused the Modi government for ruining Nepal-India relations, for sending Nepal to China’s embrace, and for supporting a small minority  and alienating the majority in Nepal. Some opposition legislators were blunter than others. Mani Shankar Ayer said the Indian government was backing a small band of Madheshi leaders who had lost the recent election and who enjoy no public support.

Both India and Nepal have looked to the international community for support, but only with limited success. Modi succeeded in harnessing British Prime Minister David Cameron’s endorsement to his country’s position on Nepal’s new constitution when he visited Britain. But elsewhere, he has so far failed to find such support.

Nepal has succeeded in obtaining sympathy from China, from Pakistan and to a certain extent from Bangladesh. Western countries have also expressed their concerns about the restrictions on the border. But Kathmandu has failed to convert such concerns into political pressure on India to ease up the supply situation.  Neither has it succeeded to capitalize China’s sympathy, as demonstrated by the offer of 1.3 million liters of petroleum products free of cost, by quickly ensuring the supply of petroleum products.

Which brings me to the 8-point understanding reached by Foreign Minister Thapa in Beijing last week. It is a right step forward for the future, but it does not give people cooking gas, petrol, kerosene, medicine and construction materials that they need now. Thapa’s China visit should have taken place soon after his first India visit failed to ease the Indian restrictions on the border.  Some may ask: What about the understanding under which Nepal agreed to buy one-third of petroleum requirements from China?

That clearly is a half-hearted white wash to mislead the public.  If Kathmandu was serious about it, Thapa would have come back from Beijing with a more immediately realizable result, not a distant promise.

It is clear that Kathmandu is reluctant to change the status quo, and the pointers are many. Failure of the prime minister and foreign minister to speak on the phone to their Chinese couterparts about the crisis, while they spoke to their Indian counterparts. Failure of Thapa to visit Beijing soon after his first India visit did not result in the ease of the supply situation. Sending to China only very junior level officials from the government and from the Nepal Oil Corporation, just to be seen doing something, not to achieve a breakthrough.

Some might ask, what about the Supply Minister Pun’s visit to the Middle Kingdom. Well, he went there, not as representative of the government, but of his own party.

Anyway, here is Economics 101. Each country should try to diversify its supply lines to ensure that supplies remain available at all times, even when there are disturbances in one line, and that citizens do not have to suffer shortages and do not have to pay monopoly price to one supplier. Increased and diversified Nepal-China trade will bring significant benefits not only to these two countries but also to India. Therefore, I see no reason why India should be unhappy about it.

Nepla will have supplies from more than one source for supply stability and reliability. It will have more Chinese investment in its industry and transport — roads and railways — that are already on the card, as parts of the Silk Road initiative as well as under the Infrastructure Bank. China will have additional access to South Asian markets through Nepal and stronger neighbor to minimise security threats from across the Himalayas.

India will also accrue significant political and economic benefits. Politically, the Nepalis will stop blaming India and their anti-Indian sentiments will drastically subside when their reliance on it decreases significantly. Now they blame India for everything — political uncertainty, failure of development, and disruption of supplies even when it might have been caused by factors beyond its control — such as wars, natural disasters, labor strikes, etc. Diversified supplies will mean stable supplies and less reason for India-bashing in Nepal, which is common now.

Economically, India will directly benefit from Chinese investment in Nepal’s transportation and industry. The investment in transportation will increase connectivity between Nepal, India and China, integrate their markets, expand markets for each other’s products and services, and increase the efficiency and productivity of their industries, which will then be able to offer better products at home and competitive products across the world.

Foreign Minister Thapa’s 8-point understanding will not burn the stoves, fuel the vehicles, and alleviate the paucity of pharmaceutical products now or in next few months. However, it may open the door for a better future of all neighboring countries, in the long run, staring with the new year.

Happy New Year 2016.



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