Ill design exposed once again

Yuba Nath Lamsal

Many tend to believe that Nepal is on the spotlight of the international community and more particularly of our immediate neighbors. It is not merely its abundant natural resources including rich hydro power potential from its perennial rivers but Nepal’s strategic location and position that have attracted attention of the world. Nepal is situated in world’s highest point between Asia’s two giants—China and India, which are vying for becoming global powers. These two countries are both competing and cooperating in various spheres. They are cooperating with one another in areas where their interests converge and competing when their interest clash.

Given this cooperation and competition between China and India, Nepal’s geostrategic position and advantage can be its assets and it can be utilized for Nepal’s well-being. It largely depends upon how we demonstrate our ability, skill and acumen. But the same strategic advantage can become strategic vulnerability, if we fail to handle it properly and utilize it for our advantage. The present situation of Nepal is exactly the same as Nepal’s strategic advantage has been reduced to strategic vulnerability due mainly to our failure to reap the benefit from this position. As a result, Nepal is being squeezed badly and in a brazen manner by the powerful southern neighbor especially on the use and utilization of our own resources, that, if Nepal agrees to the conditions proposed by India as has been reported in the media, we, one day, will be in a position to be a mute spectator when our own resources would be looted by others.

This is exactly the case that has cropped up between Nepal and India on the use of Nepal’s own water resources and development of hydro power potentials. Given Nepal’s disadvantageous position in all previous water resource and hydro power related agreements with India, a new but more serious debate has started in Nepal on the use and harnessing of Nepal’s water resources when India suddenly proposed a new agreement concerning power trade and hydro power development in Nepal. India has proposed this new agreement to be signed before or during the visit of the Indian Prime Minister Narendra Modi to Nepal probably in August.

It has been reported in the Nepali media that the Government of India has sent a draft proposal to Nepal Government on hydro-power development in Nepal, which, if true, are detrimental to Nepal’s national interest. According to the media, one of the provisions in the four page draft proposal for comprehensive water resource development forwarded by India states: the parties (Nepal and India) “will cooperate in effective harnessing of Nepal’s hydro power potential through facilitation and speedy construction of hydro electric projects in Nepal, either with 100 per cent Indian investments or joint venture with Indian entities”. This clause clearly intends to deny and discourage investors from other countries to invest in Nepal’s hydro power sector and give monopoly to India in Nepal’s water resources and hydro power. This will have far-reaching negative consequences in Nepal’s overall development. Nepal’s lucrative market for foreign investment is the hydro power and if the foreigners are denied to invest in this lucrative sector, they will definitely not be interested to invest in other sectors as Nepal’s market is relatively small compared to that of its neighbors. So this is a well-calculated move not only to control water resources and hydro power of Nepal but also to permanently strangulate Nepal’s development endeavors and keep Nepal in poverty and backwardness forever.

Moreover, India’s intention is clear as it does not want to develop hydro power projects but to drive investors from other countries away from Nepal. If India had really been interested in building and constructing hydro power projects and supporting Nepal, it could have started and completed the already agreed upon projects including Pancheswar and Naumure. Pancheswar project had agreed upon between Nepal and India as a part of the Mahakali Treaty and  the work of the project was to begin within five year of the signing of the project and to be completed within the period of ten years. However, the project has not started even 17 years after the agreement was signed and there is still no possibility of its construction in future.

As Indian Prime Minister Narendra Modi is paying an official visit to Nepal in the long interval of 17 years, it has stirred much speculations, expectations and suspicions. Modi has announced will visit Nepal probably next month at the invitation of Prime Minister Sushil Koirala, for which preparations are being made in a hectic manner in Kathmandu and New Delhi.  Hectic consultations are also being made at different levels to finalize the issues Modi’s visit. As has been reported in Indian media, India is likely to announce a broad economic support package for Nepal’s infrastructure development including road construction, telecommunication, railway networks and hydro-power projects, among others. However, nothing specific, so far, has been finalized as both the countries are still in preparatory phase. But the economic package seems to be India’s carrot to control Nepal’s hydro-power and water resource, which has already raised much alarm in Nepali intelligentsia and general people.

Although Indian Embassy has claimed in a statement that the proposal was put forward just for discussion and can be altered and modified if Nepal wishes so, the proposal clearly points to India’s ill-design to take advantage from Nepal’s political transition.  History is witness that New Delhi has always come up with proposals and got them signed during political transition in Nepal. In 1950, when the Rana regime was on the verge of collapse in the wake of popular movement, India came up with the proposal of a treaty, which Rana government agreed in the hope of clinging onto power with India’s backing. This is how the 1950 treaty, which many Nepalese people call it unequal treaty, was signed. Even in 1989 when the popular movement against the King’s absolute regime was at its height, India, apart from imposing economic and trade sanction against Nepal, proposed a new treaty that was clearly against the interest of Nepal in exchange of lifting sanction and also support to the monarchy against the political parties demanding multi-party democracy. However, king Birendra refused to give in to India’s proposal, instead, he chose to bow down to people agreeing to relinquish his absolute power. Now Nepal is undergoing a political transition, which has been taken as an opportune time to force Nepal to sign some new agreements giving India an upper hand and control in Nepal’s water resource.

It has also been reported that India is interested to construct 900 megawatt Karnali hydro electric project and an agreement is likely to be signed during Modi’s visit. However, construction of this project is doubtful as there are several other projects that India has already agreed to construct but not implemented. Even if agreement was signed on the Karnali project, it will never be implemented. Its only intention is to lure Nepal to sign the objectionable power trade agreement and other deals. All facts and figures tell us that Nepal has always been cheated and betrayed in all water resource related accords and agreements like Koshi, Gandaki and Mahakali. India has been eying on Karnali River for a long time as it is only the major river system left to be entered into Nepal-India bilateral agreement. Of the four major rivers of Nepal flowing down right from the Himalayas are Koshi, Gandaki, Karnali and Mahakali. The rest of other rivers are tributaries of these four river systems. Once agreement was signed on Karnali project, all four major river system of Nepal would be in total control of India.

Right from the beginning, India has been trying to discourage involvement of other countries in Nepal’s hydro power sectors. India has also been objecting and obstructing, directly or through the use of backdoor channels, Nepal’s efforts of independently handling and developing hydro power projects. When Nepal was trying to develop Karnali-Chisapani project with support from the World Bank way back in 1970s, it was India that used both direct and backdoor channels to sabotage this project. Arun III project, too, saw exactly the same fate. The present Indian proposal ‘ either to have 100 per cent Indian participation or joint venture with Indian companies’ comes at a time when Chinese companies and investors from other countries are showing interest in investing in and developing Nepal’s hydro power sector.

The new developments are the product of rivalry of great powers mainly India and China in Nepal. China does not seem to have any kind of ill intention towards Nepal but wants to support this Himalayan Republic with no string attached. But India has not been able to comprehend this reality. Instead, India is always suspicious about China and wants to discourage China’s involvement in Nepal. As China and India are our immediate neighbors, Nepal wants friendship and good will of both of them. However, we have bitter experiences with India especially on issues relating to water resources. Against this background, Nepal needs to be cautious and well prepared to negotiate skillfully in all aspects with India so that Nepal’s interest is duly protected. For this, good homework has to be done through thorough consultation and discussion with different stakeholders and experts in Nepal so that Nepal’s geo-strategic position becomes our strategic strength but not vulnerability.