Analysing Nepal’s Foreign Policy: A Hedging Perspective

Abstract

Wary of their significant dependence on India, Nepal has pursued a policy of hedging in order to mitigate potential harm. The harmful consequences of this dependence were on display in 2015 when a blockade along the southern border with India resulted in massive economic losses for Nepal at a time when the nation was recovering from an earthquake. To insure themselves against a similar fate in the future, Nepal has chosen to hedge by pursuing closer relations with China. This article analyses and outlines how Nepal has deployed this hedging strategy. It argues that Nepal’s relations with China, albeit improved, is not enough as India still retains a monopoly on Nepal’s economy. The increasingly hostile and polarised nature of Sino-Indian relations also means that hedging is not a sustainable policy, and if the rivalry between the regional powers worsen, Nepal may be forced to pick a side.