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Nepal political scene has changed dramatically recently, with Prachanda, who had been in power, suddenly forced out of power and the pro-Indian Nepal Congress party coming back to power after reaching an alliance with the CPN(UML).
The pro-India faction has demanded more harsh demands from China, only China's economic aid to Nepal, but not China's loans.
So why did Prachanda suddenly step down? What is the calculation behind the pro-Indians not wanting Chinese loans?
Prachanda lost the election and the political scene changed dramatically
On July 12, Nepal's Prime Minister Prachanda lost the vote and was unable to continue as prime minister, triggering political changes for a number of reasons.
First, Prachanda faces a complex political environment.
He had originally formed a coalition government with the CPN(UML), but this alliance was inherently unstable.
However, as early as the end of February 2023, the UML abruptly withdrew from the coalition government, leaving Prachanda's ruling position in jeopardy.
Although he managed to bring back the CPN(UML) and reshuffle his cabinet in March, the divisions within the coalition were not fundamentally resolved.
Second, Prachanda's policy implementation has been met with many challenges, such as inflation and rising unemployment, which have led to dissatisfaction with his administration, and his support has naturally been hit.
(Prachanda)
In the end, Prachanda's declining popular approval rating was one of the reasons for his defeat.
Although he received a lot of support in the early days of his term, over time he failed to deliver on many of his campaign promises, causing voters to gradually lose confidence in him.
Government inefficiency and corruption have also further exacerbated popular discontent.
Prior to the vote of confidence, Prachanda failed to effectively adjust his strategy and gain the support of more political allies and voters, leaving him isolated in parliament.
It was for these reasons that Prachanda could not be re-elected as prime minister, so the Nepal government decided to keep the Communist Party of Nepal (UML) and the Nepal Congress Party in power until 2027 before the next elections.
This means that the leaders of the two parties will take turns as prime ministers of the country.
However, this is not a good thing for China, and why is that?
The "pro-Indian" faction has an unfriendly policy toward China
The Communist Party of Nepal (UML) political advocates cooperation with China, that is, the "pro-China faction", whose party leader is Oli, while the Nepal Congress Party advocates pro-India and is known as the "pro-Indian".
The fact that the two parties, which had previously had major differences over their political views on China, now rotated as prime minister means that the pro-India faction has come to power again after a short absence.
Judging from the past style of the "pro-India faction" towards China, this is not a good thing for China, and the specific reasons are as follows:
First, the Nepal Congress Party stressed close ties with India.
In 2022, then Nepal Prime Minister Deupa ("pro-India") held talks with India Prime Minister Narendra Modi, where the two sides reaffirmed friendly relations between the two countries and explored in-depth cooperation in areas such as hydropower cooperation, education and state institutions.
(Chairman of the Nepal Congress Party Deupa)
In terms of economic policy, the Nepal Congress Party hopes to boost domestic economic growth by bringing in more India investment.
India is Nepal's largest trading partner, and the two countries have close economic ties, and the Nepal Congress Party advocates attracting India companies to the Nepal market.
In particular, in the area of infrastructure development and industrial development, in order to boost the local economy and create jobs.
For example, they reached an agreement with India to jointly invest in cross-border rail projects to improve transport links and boost bilateral trade.
Second, the Nepal Congress has taken a more cautious approach to relations with China.
They welcomed the Belt and Road Initiative (BRI) and welcomed investment from Chinese companies, but were wary of Chinese loan projects because they feared they could tip Nepal into debt trouble.
For example, they asked for a reassessment of the China-Nepal railway project, saying that they were only willing to accept China's free aid rather than loan support to avoid increasing the country's financial burden.
(Railroad trains)
This position has sparked widespread discussion in Nepal, with supporters arguing that it is to protect the country's economic sovereignty and avoid falling into a "debt trap", and those who do not support it believe that the party's decisions are too hasty and will affect Nepal's economic development.
The Nepal Congress Party also emphasizes national sovereignty and independence, opposes any external interference in Nepal's internal affairs, and strives to maintain autonomy while cooperating in its relations with China and avoiding excessive dependence on a single country.
Finally, the party is also planning to sign the Millennium Challenge Initiative (MCC) with United States.
The MCC plan was proposed back in 2017 and is essentially a Nepal to accept $500 million from United States to help the country build, but parts of the agreement are not governed by Nepal law.
If this agreement is signed, it is possible that the United States will be able to station troops here in the future, which will pose a major threat to China at that time.
In February 2022, United States President Joe Biden asked Nepal to sign the agreement quickly, and Nepal's "pro-Indians" expressed strong support for this.
(Nepal people protest on the streets against the MCC-related agreement)
Such a treaty that overrides the laws of the country and humiliates the country can be passed by the "pro-Indian faction", which naturally aroused the dissatisfaction of the Nepal people, and the local people have marched and protested.
Moreover, once the treaty was signed, it would cause conflicts between China, Nepal and Indonesia, so the treaty was not implemented in the end.
Therefore, from these concrete examples, it can be seen that the Nepal Congress Party did not benefit China when it came to power.
Prospects for future relations between China and Nepal
As for the issue of Nepal's current coalition of prime ministers, judging from China's past response to Nepal's introduction of a coalition government, China has always supported the friendly and peaceful development of the two countries.
This is because the stable political situation in Nepal is conducive to long-term cooperation between China and Nepal, especially the projects under the framework of the Belt and Road Initiative.
China has always supported Nepal's sovereignty and independence and is willing to cooperate with any Nepal government to promote the sustained development of bilateral relations.
Although there may be some contradictions between the two countries after the "pro-India faction" comes to power, the "pro-China faction" has actively promoted China-Nepal infrastructure cooperation projects since the previous period when the "pro-China faction" was in power.
For example, the Trans-Himalayan Three-Dimensional Connectivity Network, the China-Nepal Railway Project, the Belt and Road Initiative, and so on, even if the "pro-India" faction is in power, it may not necessarily pose any major threat to China.
(Ollie photo)
Despite the challenges ahead between the two countries, China-Nepal cooperation is still full of potential.
China can further deepen economic cooperation between the two countries by increasing investment in Nepal in the future, especially in the fields of electricity, transportation and infrastructure.
At the same time, by strengthening exchanges in the fields of culture, education, and tourism, China and Nepal can strengthen people-to-people friendship and consolidate the social foundation of bilateral relations.
In short, China-Nepal relations will face new challenges and opportunities in the future, and China needs to respond flexibly to Nepal's complex political environment to ensure the realization of its own interests.
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Resources
At the end of the election in the neighboring country, the pro-India faction came to power again, asking China for money as soon as it opened its mouth, and refused to pay interest Phoenix.com
Prachanda was relieved of his duties by the Global Times
Nepal Prime Minister Oli was sworn in China Economic Net