China and South Asia: core interests and policies and their impact on the regional countries (a Nepalese perspective)

This paper aims to understand the impact of China’s increasing economic and military influence within the context of South Asia. China’s determined and sustained economic growth since the 1990s has not been reciprocated by its neighbours in South Asia, and this paper examines the possible causes why. The author argues that much of the geopolitical and economic landscape of South Asia will have to change before efforts to develop bilateral and regional relationships with China can prove to be successful.

The paper traces the rise to prominence of China within the regional context, and looks at the changing nature of the political leadership as a major catalyst of this shift. This shift in political ideology has occurred in the context of changing political alliances around China’s borders. In particular, since September 11, 2001, traditional allies (and neighbours) such as Pakistan, Uzbekistan, Tajikistan, and Kyrgyzstan have all offered or acquiesced to America’s requests for use of bases and airspace to launch its operations on Afghanistan. The paper suggests that this sudden concentration of American forces and sophisticated weapons in such close proximity to China has left the leadership feeling “encircled”.

The cumulative impact of these events and policies are then explored systematically. The author conducts a brief assessment of China’s individual economic and military relationship with India, Pakistan, Bangladesh, Sri Lanka, Bhutan, Maldives, and Nepal.

The author then focuses on the existing challenges and possible benefits of developing a working relationship between China and the South Asian Association for Regional Cooperation (SAARC). The paper explores the major barriers to developing a working relationship, concluding that:

• building healthy political relations within current member states of SAARC will have to be initiated before external involvement
• a strong financial base capable of supporting its own influence will be necessary before economic benefits can be gained from Chinese cooperation
• a strong transportation and communications infrastructure is necessary to facilitate mutually beneficial trade and investment
• the bilateral tension between India and Pakistan could expand to include China as an active third party, broadening the propensity for conflict

The paper concludes by assessing the current, albeit small, successes of bilateral and regional trade and cross-cultural initiatives, and identifies historical ties as a means to strengthen future ventures.