BALANCING THE HIMALAYAN NEIGHBOURS: UNPACKING NEPAL’S PUBLIC PERCEPTION OF INDIA AND CHINA

India-Nepal people-to-people relations are built on common cultural and religious commonalities, while government-level relations have undergone several highs and lows owing to the changing political environment in Nepal. In the past few years since Nepal’s transition towards constitutional democracy, India has often found itself in a complex space when dealing with Nepal. Two important reasons for these complexities in relations are – evolving socio-economic aspirations of Nepali people and China’s growing involvement in its Himalayan neighbour. Nepal’s population is gaining voice as its democracy continues to take shape and thus, compelling its political leaders to increasingly align their policies with the public perception. This has also pushed India to reorient its Nepal policy to manage these evolving public sentiments. Secondly, China’s Nepal policy has also transitioned from being Tibet-centric to a more comprehensive one which encapsulates both economic and cultural engagements. This has allowed Nepal to not only play the “China card” to hedge against India’s influence, but has also influenced Nepal’s public perception, thereby threatening India’s popular positive image. 

As rightly pointed out by India’s former ambassador to Nepal, Rakesh Sood, India and Nepal enjoy the closest as well as the most complicated bilateral relationship at the same time. With regards to India’s perception in Nepal, despite well-established cultural connections over centuries, India’s shortcomings in its public diplomacy approach in Nepal have failed to achieve desired results. At the same time, China’s public outreach in Nepal through educational exchanges as well as dedicated efforts towards establishing more visibility sometimes perceived to have worked against India’s interests. These changes in India-Nepal dynamics are further negatively propagated by Chinese media, criticizing India for dominating as Nepal’s “big brother” and praising China as its “friend”. Moreover, episodes of protests in Nepal against India, such as the one in 2020 against the opening up of a new road passing through the contested Lipulekh pass, also created an impression of India’s declining influence in Nepal.

Meanwhile, based on the survey I conducted of over 230 citizens on Nepal’s perception of India and China across Kathmandu’s major tourist and education centres, it reveals that India continues to outweigh China in different aspects ranging from its soft power influence to relevance for Nepal’s economic development. Such public perception surveys about Nepal’s relations with India and China reveal a more accurate picture of Nepali people’s expectations, and evaluate how India and China have managed them and also fulfil their own respective interests simultaneously. Despite China’s inroads in Nepal in various domains, the survey suggests that Nepali people majorly expect to restrict this involvement to economic cooperation which includes trade, investments and development assistance. The findings of the survey also corroborate the argument that India’s Nepal policy needs refinement, if not the reset, as public discontent against India often provides undue advantage for China to expand its foothold in Nepal. This survey also re-confirm many results of its previous iteration conducted two years ago, particularly with respect to India’s soft power influence in cultural aspects as well as its role in Nepal’s economic development. On the other hand, it also reveals some evolving trends in India-Nepal-China trilateral relations which offer valuable directions for fine-tuning of India’s Nepal policy.

China’s Problem-ridden Economic Engagements

Economic engagements by China in Nepal, which include trade, investments as well as development cooperation, are primary drivers of China-Nepal relations. Among these aspects, 61 percent of respondents believe that trade and investments play a crucial role in the strengthening of bilateral relations, followed by 32 percent people who feel that development cooperation and disaster aid is a primary driver of Sino-Nepal relations. With respect to trade, landlocked Nepal is largely reliant on India despite the calls for trade diversification as open borders benefit Nepali people get products at much cheaper costs. On the other hand, China-Nepal border is still largely inaccessible for Nepali people due to mountainous terrain and thus, makes Chinese products difficult to compete with Indian products. With the possibility of Nepal upgrading from the Least Developed Country (LDC) status and consequent removal of tariff exemptions in 2026, Nepal’s trade with its neighbours is likely to become more crucial than ever, thereby offering opportunities for both India and China to strengthen their relations with Nepal.

China’s investment under its flagship Belt and Road Initiative (BRI) is another major avenue for its involvement in Nepal. Despite the signing of the initial BRI MoU in 2017, it took seven years for China and Nepal to agree on an implementation plan. Moreover, other major proposed Chinese-funded projects such as Kathmandu-Kerung railway line, construction of Tokha-Chhahare tunnel and Kathmandu ring road expansion are also affected by indefinite delays for various reasons. In this regard, 68 percent of respondents believe that constant political instability is the primary reason for the delay in BRI implementation. They feel that this instability has led to insufficient political will to execute proposed BRI projects. According to Nepali people, other reasons like unviability of projects and Nepal’s cautious approach towards Chinese loans to avoid debt trap have also delayed BRI projects (figure 1). Further, Nepal’s insistence on grants instead of loans to implement Chinese projects has been another obstacle in expediting China’s investments, which continues to remain ambiguous even after PM Oli’s recent Beijing visit that resulted in signing of the BRI implementation plan.

In the past few years, Nepal has often turned to China for economic opportunities as it grapples with unemployment problem, overdependence on agriculture sector as well as lack of foreign trade diversification. In this regard, Nepal’s political class, particularly leaders from its Communist parties, signed several agreements with China ranging from investments in Nepal’s hydropower projects to getting access to China’s ports for external trade under the transit agreement. Though such Chinese engagements allowed by Nepal’s leaders align with overall public perception in Nepal, they often cause problems for Nepal such as corruption and environmental concerns which sometimes go under-reported in Nepal.  

Figure 1: Reasons for Delay in BRI Implementation

India’s Cultural Ties Dominate, But Not Enough

On the other hand, India’s cultural connections with Nepal through shared history, language and religious practices have built strong relations over centuries. About 59 percent of Nepali citizens interviewed during the survey reconfirm that the shared culture and history continues to remain the primary pillar of India-Nepal relations. Amongst shared cultural symbols, Hinduism is one of the important instruments of India’s cultural diplomacy in Nepal. Majority of the surveyed people (62 percent) feel that Hinduism has brought Nepali people closer to India. Nepali people’s curiosity towards the Maha Kumbh, Ram mandir inauguration and major Hindu pilgrimage sites shows that religious connection with India is deeply ingrained in people’s minds. These respondents, particularly the younger generation, also feel that cultural ties do not remain limited to historical factors but also extend to modern cultural symbols like Bollywood, dance forms and Indian regional music as well as Indian social media which is popularly followed in Nepal due to language familiarity and relatable content. However, this relatability has also caused problems for India in the past for being perceived as insensitive towards Nepal’s concerns. 

Besides these common cultural symbols, 32 percent people feel that economic linkages in terms of trade and employment opportunities offered by India act as a primary factor for stronger bilateral relations. One estimate suggests that there are around 4 million Nepali students and workers living in India, offering testimony to India’s contribution in Nepal’s development. These economic linkages are further strengthened by India’s development assistance due to which 8 percent of respondents feel closer to India. This trend implies that while Nepali people’s emotional connect with India through common culture remains paramount, they are increasingly looking at India to offer more economic opportunities.

In this regard, India has also made efforts to leverage its cultural affinity with Nepal through more lucrative economic opportunities. India’s decision to jointly promote Ramayana and Buddhist tourist circuits with Nepal aims to capitalize on religious connections and generate economic benefits for both countries. Moreover, thousands of Nepali citizens visit Indian pilgrimage sites every year such as four dhams, Haridwar, Rishikesh, Gaya and more. Similarly, several Indians visit Nepal’s religious sites like Janakpur, Lumbini and Kathmandu, offering employment opportunities for Nepali people. Yet, in the past few years, Nepal’s emerging national and regional identity have brought to the fore other issues such as boundary disagreements, Nepal’s overdependence on India as well as perception of Indian interference in Nepali affairs. These issues often overshadow cultural affinity and create mistrust about India’s intentions and actions in Nepal. Thus, over the years, it is becoming clear that while cultural connections still dominate India-Nepal relations due to its uniqueness and longevity, its relevance has been on the decline as other pressing issues take prominence and thus, necessitate reorientation of India’s cultural diplomacy in Nepal towards fulfilling economic aspirations.    

Is Chinese Engagement in Nepal a Concern for India?

Besides India’s cultural soft power tools, other aspects of soft power such as educational exchanges, development cooperation and humanitarian assistance have witnessed a strong competition from China. In terms of better higher education opportunities for Nepali students, Nepali people prefer India as a better destination owing to language familiarity and quality of education (figure 2). This is also evident from the estimates of 65,000 Nepali students studying in India on average at any given point of time, which is 10 times higher than the number of those studying in China. Several respondents also clarified that they would prefer India for courses in information technology, engineering, medicine and social sciences. Nonetheless, India must remain cautious when dealing with instances of treatment given to Nepali students in India which strongly resonate into anti-India sentiments back in Nepal, and can negatively impact students’ perception of India.

Figure 2: Influence of Non-Cultural Soft Power Tools in Nepal

Another major soft power avenue for both India and China is the tourism sector in Nepal which is supported by a huge influx of Indian and Chinese tourists. For instance, over 3.17 lakhs Indian tourists visited Nepal in 2024, accounting for nearly one-third of Nepal’s total foreign tourists. On the other hand, 1.01 lakh Chinese tourists visited Nepal during the same period, increasing by 67 percent over the last year. Despite this rapid increase in Chinese tourists, Indian tourists are favoured for being friendlier towards Nepali people compared to China (Figure 2). The language barrier plays a major role in limited interactions between Chinese tourists and Nepali locals, a factor that works in favour of India. Thus, use of Hindi or dialects of Hindi as common means of communication between Indians and Nepali citizens has provided a significant edge for India over China. The development of tourism circuits can further boost tourism opportunities for Indians in Nepal, thereby strengthening Nepal’s economy as well as bolstering positive perception of India.     

However, the most important challenge lies for India in terms of transforming the positive perception of India on different soft power metrics into a positive image. In this regard, only 41 percent of respondents feel that India has successfully established a positive image among Nepali people, whereas 54 percent support China on this front. It indicates that despite India’s strong soft power appeal, Nepali people still emphasize on contentious issues in bilateral relations, thereby negatively affecting India’s image. As per the surveyed people, India’s Nepal policy is often perceived for being overly Madhesi-centric and neglecting other Nepali communities. This trend also highlights limitations of India’s public diplomacy efforts and its inability to build a pan-Nepal positive image by doubling down on positive aspects of bilateral relations.

Many respondents who chose China also clarified that India had a strong positive image prior to the 2015 blockade which significantly affected its goodwill. Memories of the blockade are often associated with India and its public diplomacy efforts have not been able to resolve this negative perception even after a decade. On the other hand, Chinese involvement in Nepal is often perceived by Nepali people as being limited to economic assistance and thus, helps China maintain a positive image with limited exposure. Thus, given the comprehensive nature of India’s relations with Nepal, Chinese engagement in Nepal may not cause immediate concerns for India, provided India improves on its ability to manage public sentiments. Nonetheless, major challenges for India emanate from mismatch between its own actions and Nepali people’s expectations, particularly during crisis scenarios, causing substantial impact on India’s overall image. 

People’s Perception on Nepal’s Balancing Act

In pursuit of reducing reliance on India, Nepal’s political leaders have been making efforts to expand its relations with China. This trend has grown rapidly during the new democratic set up in Nepal under which anti-India sentiments are often stoked to spur Nepali nationalism. As Nepal continues to pursue China to accrue more economic benefits, a substantial majority of people still consider India to be a primary development partner compared to China, thereby creating gaps in policymaking and public sentiments. (figure 3) Respondents supporting China as a primary development partner believe that China’s rapid growth trajectory could be helpful for Nepal’s own development model. But, given deeper economic linkages between India and Nepal for centuries, India will continue to outweigh China as Nepal’s primary development partner despite some aberrations like China overtaking India as Nepal’s largest FDI source. Such a perception favouring India limits the effectiveness of China’s economic engagements and may compel Nepal’s leaders to reconsider Chinese involvement.

On the contrary to this clear trend in terms of Nepal’s preferred economic partner, 37 percent of respondents India as a preferred foreign policy partner to gain more comprehensive benefits globally. On other hand, China is favoured by 39 percent respondents as a reliable foreign partner, giving a miniscule edge over India. Many of these respondents believe that China’s growing stature in global politics as a rising superpower could help Nepal’s case to emerge as a regional power. More importantly, 24 percent people also feel that Nepal must balance its relations with both countries instead of rallying behind one partner, thereby giving some credence to Nepal’s current foreign policy approach. This trend emerges from Nepal’s growing regional aspirations which can transcend India’s traditional influence in Nepal if not addressed by India in the near future.

Amidst all these trends in Nepal’s public perception, it still remains generally satisfied about the overall strength of India-Nepal relations, particularly when compared to Nepal-China relations. When asked to rate the current strength and future trajectory of Nepal-India and Nepal-China relations on a scale of 0 to 10, around 57 percent of respondents ranked Nepal-India relations between 7 to 10 (Figure 3). For China, 42 percent of respondents ranked the strength of bilateral relations between 7 to 10, thereby clearly indicating Nepal’s overall public perception in favour of India. China’s nascency of bilateral relations with Nepal is also visible from the fact that majority of respondents ranked China between 5 to 6, as against India’s majority rating between 7 to 8. Thus, despite existing political tensions between India and Nepal along with sporadic discontent against India’s actions in the past few years, foundations of India-Nepal relations still remain strong as Nepali people continue to hinge on India to fulfil their aspirations.

Figure 3: People’s Perception of Nepal’s Balancing Act

India’s Way Forward

The survey reiterates the fact that India’s cultural closeness forms the bedrock of India-Nepal ties. Yet, with evolving socio-economic interests of Nepali people, India’s public diplomacy strategy cannot afford to be over reliant on socio-cultural connections as growing aspirations are increasingly shaping Nepal’s perception about other countries. Although India substantially contributes to Nepal’s economic development, reconfirmed during the survey, it lags behind in terms of leveraging this contribution for its positive image. In this regard, India needs to create a recognizable framework by which its economic assistance is offered, such as the one created by China through ‘China Aid’ posters in Nepal (Figure 4). More importantly, effectively leveraging cultural ties would require complementing them with more economic benefits for Nepali people through tourism, employment opportunities in Bollywood and other Indian region cinema as well as by promoting commercial learning centres of Indian dance and art forms in Nepal. Similarly, the popularity of Indian social media in Nepal must be utilized to promote more positive stories of India-Nepal ties and to maintain transparency in people-to-people relations. 

Figure 4: 'China Aid' Poster Outside Basantpur Palace

Secondly, Nepali scholars and common people generally agree that Nepal has huge expectations from India due to its long-standing cultural and emotional ties, and thus, any unmet expectations quickly lead to discontent against India. This has been often witnessed in the past as narratives surrounding the 2015 blockade, Kalapani border dispute or Agnipath scheme have time and again tested India’s goodwill in Nepal. As these episodes, and similar issues in future, will be largely managed at the government level, India must ensure that it does not have spillover effects on India’s image among Nepali people. Managing such crisis scenarios would require stronger connections with Nepali people through a dedicated system of people-to-people exchanges. These channels of communication, built through Track 2 and other non-governmental dialogues, can help India to maintain transparency by disseminating clear messaging during crisis situations.  In this regard, the ambiguity surrounding the Eminent Persons’ Group report must be resolved at the earliest as it may create trust deficit between India and Nepal in the long run. If these efforts succeed in substantially improving India’s positive image, it can also persuade Nepal’s political leaders to make policy choices in alignment with public sentiments which can also aid faster resolution of contentious issues. However, for this to happen, creating a mechanism to constantly monitor people’s pulse in Nepal is an immediate need for India.

Lastly, the survey indicates China’s growing acceptance among Nepali people as an emerging economic partner despite India’s strong influence in this domain. The re-opening of 14 border trade points between Nepal and China along with contributions from Tibet government for Nepal’s socio-economic development projects aim to deepen these economic ties. Amidst this, India must adopt a more pragmatic approach while engaging with Nepal in economic sectors. Keeping in mind the discontent faced due to India’s decision to restrict purchase of electricity from Nepal with Chinese inputs, its recent announcement of long-term electricity trade deal will help pacify public sentiments in Nepal. More importantly, intentions behind restricting any economic engagement with Nepal in future must be communicated clearly to the common audience to avoid China an opportunity to propagate anti-India narratives. Moreover, increase in budget for India’s High-impact Community Development Projects in Nepal’s remote areas as well as opening up of new integrated check posts will also go a long way in cementing India’s position as a primary economic partner despite China’s inroads in Nepal’s economy.  

Thus, India’s dealing with Nepal needs a balance between leveraging its historical connectedness and addressing emerging socio-economic aspirations of Nepal. The survey confirms that although China’s footprint in Nepal grows in different sectors, Nepali people continue to expect India to contribute more in its development. Despite this assuring trend, India still requires reorientation in its Nepal policy to effectively counter Chinese actions by removing bottlenecks in its own public diplomacy strategy and economic engagements. This will not only allow India to build on centuries of ‘roti-beti’ connections with Nepal, but also make more meaningful contributions to the development of a brotherly neighbour.

The author would like to acknowledge the contribution of Ms. Eerishika Pankaj, Mr. Rahul Karan Reddy, Dr. Pramod Jaiswal, Ms. Sumitra Karki and the NIICE Team for their assistance and warm hospitality, which made this research possible.