The History of Soft Power Contest in Nepal: China Vs India

01 December, 2022

Research Reports


For a landlocked Himalayan country with moderate resources and population, Nepal occupies a prominent place in the contemporary geopolitical security concerns of Asia. It is a ground for active power contests between two of Asia’s giants- India and China and, thus, a hotspot where the two countries wage for prominence and influence. This is because Nepal is the buffer state that separates these two rivalling nations. Its unique geographic location renders Nepal sandwiched between China and India, making sure that either country has to cut across the comparatively smaller Himalayan kingdom to step into the other. From a different perspective, it can also be understood as such that one nation has only to cut through Nepal to wage war against the other. Thus, the inclination of Nepal to any one of the duo is a nightmare to the other.


These fears are not without substance, either. China is an expansionist power and is known for its irredentism. It has made claims on substantial portions of its neighbouring countries based on the argument that they were once part of the Chinese empire. Moreover, China has historically looked at Nepal as the soft underbelly of Southern Tibet. Under these circumstances, China wanting to bring Nepal into its sphere of influence unsettles India. If Nepal decides to slant towards China, it will open up the Indo-Gangetic plain and thus the Indian heartland to the latter, rendering India helpless to defend itself in case of any conflicts. Thinking from a realist perspective, therefore, India is justified in its need to push China out of Nepal and from anywhere near its borders.


However, looking at the other side of the coin, China is also in dire need of building friendly relations with Nepal. It is adamant about keeping India’s power within the Himalayan nation under check for the very reason that it needs to secure Tibet from external meddling. China worries that Nepal will be used by foreign influences to stir up trouble in Tibet, as witnessed by the 1959 Khampa rebellion and the 1960 Nepal protests against China in Tibet (Prajapathi, 2011). This forces China to thwart the Indian interests in Nepal, especially since it considers Tibet as a matter of national security and India as a major anti-China force. Apart from this, Nepal is also part of the Chinese plan to build a network connecting itself with its neighbouring countries through roads, rails, and the internet. At a time when China believes that it is being encircled and surrounded by anti-China forces, including the US, much of the West and India, its long-term economic interests, such as connectivity projects with the neighbouring states, take priority (Jaiswal, 2014). Its interest in Nepal is also in line with the Chinese intention to bring more countries to its side before the widely predicted US-China conflict. Thus, ensuring that Nepal is under their influence or at least neutral in its decisions is not only advantageous but also a minimum necessity for both China and India. And hence, with these causes under their belt, both nations have been vying to win away Nepal by all possible means.


Power: (Not) by all means

It is imperative, however, to note that these attempts have rarely turned confrontational between any of the stakeholders involved. If one excludes the border disputes that have consistently irked conflicts between the trio, the relationship between China, India and Nepal has hardly been characterised by arms or weapons. The power that both China and India seek to gain in Nepal is not at the cost of Nepalese sovereignty or authority. Hence the push and pull for power and influence in Nepal has rarely required an exhibition of military capabilities or political supremacy. But this is not to argue that the giants have always resisted themselves from issuing their coercion on Nepal. For instance, India in 1989 imposed a virtual trade blockade and an economic sanction on Nepal, owing to the latter’s reluctance to agree to a single trade and transit treaty. While Nepal justified its position with respect to its right to freedom of trade, India also persisted in its decision, stretching the border blockade from March 1988 till April 1989. During this period, India prevented the landlocked country from accessing its ports to transport emergency goods, including petroleum products. This caused serious repercussions on Nepal’s economy, with its GDP pulled down to 1.5% from a whopping 9.7% over the span of a year. Eventually, Nepal had to back down from its position, allowing India to exert its economic power over Nepal (Bhattarai, 2015). However, it is to be noted that the effects of India’s exertion of economic power on Nepal were not limited to its economic arena. It became an indirect infringement on Nepalese sovereignty. More so, when it was hinted that India’s economic blockade was a protest against Nepal buying arms from China more than it was a protest against Nepal hesitating to agree to the treaty (Crossette, 1989). Here, India’s imposition of its decisions on Nepal was coercive, constituting one of the few incidents where the giants exercised hard-line power over Nepal. To be sure, however, these events constitute perversions from the usual and dominant policies of China and India within Nepal. Instead, when it comes to exercising prominence in the smaller, hilly nation, soft power has been the way to go almost all the time.


Soft power refers to the ability of states to alter the behaviour of other states to get what they want by attraction and co-optation as opposed to coercion (Nye, 1991). The term was coined by the American political scientist Joseph Nye in relation to the questions of US power in the 1980s. Ever since then, soft power has taken centre stage when it comes to peaceful engagement and diplomacy. But even though soft power as a concept of international relations emerged with Nye in the 1990s, soft power as a prominent means of gaining power has been in use for ages. For instance, the ancient Sinocentric worldview in East Asia, recognising China as the political, cultural and economic centre of the world, was an extension of the unsurpassable Chinese soft power at the time. Even now, the extent of American influence in the decision-making capacities of sovereign nations- not due to its military capabilities but rather due to what is perceived as political and cultural superiority is a prime example of soft power exertion. Thus, soft power stands in opposition to the traditional understanding of power, which requires states to establish one others’ relationship on a coercive level. Especially with the arrival of the 21st century and new calls for cooperation, soft power has reassured its seat as a decisive turning point in international power politics. It is within the same context that India and China have resorted to soft power over other means of hard power to establish their influence in neighbouring Nepal.


The History of Soft Power Contest (1950s - 2008)

But as argued earlier, the Chinese and Indian soft power in Nepal is not an entirely new phenomenon, even as the contest over it and subsequent tension is a comparatively new addition since the late 1900s. The soft power that is wielded today came to be developed through centuries-old interaction between the states. Historically, this has been an easier feat for India, given that it enjoys geographical apart from religious, linguistic and socio-cultural proximity with Nepal. Often, such closeness overflowed into other aspects- economic, ideological and political- particularly integrating the lives of those near the open border. While these forms of influence are certainly to be accounted as the soft power advantages of India, it is to be noted that these were often outside of an institutional framework intended for power itself. Rather, it was given that a smaller country sharing an extensively long border with a larger giant such as India during the period would enjoy a considerable influence over the former. However, what is remarkable is the early access this historical presence allowed India in its subsequent power calculations. This influence helped India solidify and institutionalise its post-independent soft power exertion in Nepal. Through this, India has gained foot within Nepal, even in capacities that would be otherwise seen as obstructing Nepal’s own sovereignty.


Take, for instance, the 1950 India- Nepal Treaty of Peace and Friendship. Signed between both nations on July 31, 1950, the treaty, in general, allows for the free movement of people and goods between the two territories as well as for close collaboration when it comes to defence and foreign policy (Ministry of External Affairs, India, 1950). Such a singular treaty covering colossal aspects of bilateral relations between two nations might be understood within the context of the rise of Communist China and the consequent security concerns. However, even that cannot justify certain articles of the treaty, including Article 2, which calls for the two countries to “inform each other of any friction or misunderstanding with any neighbouring state especially when it is likely to cause a breach in the friendly relations between the two governments'' (Ministry of External Affairs, India, 1950). De facto, they will have unequal effects on the authority of both countries, given that Nepal is the one lying as a buffer state between India and China and, therefore, most likely to be subjected to these provisions. Given that such provisions might place severe limitations on the independent decision-making capabilities of Nepal, its presence in the treaty often causes misleading impressions. This is unless one takes into account the introductory statement to the treaty that says: “The Government of India and the Government of Nepal recognising the ancient ties which have happily existed between the two countries……” (Ministry of External Affairs, India, 1950). The overarching power attributed to the treaty was largely contingent on the historically amicable relations shared between both nations. Moving forward, the treaty became the primary instrument with which India exercised its influence over Nepal. By allowing for uninterrupted trade, investment and transit, the treaty furthered the exchanges between the duo. It also gave way to unparalleled cooperation between India and Nepal in multitudes of sectors, including but not limited to defence and military, connectivity and infrastructure development, energy production and transfer, employment, education, human resources and most importantly, trade, economy and investment. These helped India further its economic and socio-cultural presence within the Himalayan nation, reinforcing its identity as an inalienable hand and a big brother of Nepal. This ultimately had the effect of adding to India’s soft power in Nepal.


But this does not mean that the in-roads that India established as part of the treaty or its accumulation of soft power in Nepal remained unchallenged. From the 1950s to 2008, there were instances when India was perceived as a big bully by most of Nepal- administration and domestic population alike. The 1989 trade blockade by India, border disputes and the 1975 Sikkim accession by India have led to the questioning of India’s unhinged presence in the Nepali state. The latter, especially, created a considerable wedge in the trust between Nepal and India. Nevertheless, this sentiment was largely superseded by an image that recognized India as the big brother of Nepal. Or to reframe, at a time when Kathmandu lacked other strategic partners to balance against India’s brother attitude, Nepal was hesitant to regulate India’s influence in the state. This was especially so, given the advantages that came with the latter’s engagement in Nepal. As a result, India’s soft power exertion and accumulation in Nepal went largely uncontested and uninterrupted over the period.


China’s relationship with Nepal can also be read along the same lines as that of India. Historically, China and Nepal have maintained cordial political, religious, economic and socio-cultural relations with each other. During the Tang dynasty, Nepal was involved in creating a combined offensive against the Indian kingdom Magadha along with China and Tibet. Later in the Qing dynasty, Nepal became a tribute state to China (Upadhya, 2012). Even though these political relations persisted, it was Buddhism and the consequent matrimonial alliances and cultural exchanges that helped Nepal to identify with the Chinese empire situated across the mighty Himalayas. But the later parts of history saw a political separation between the two entities, especially from 1950 till 1955. The establishment of the People's Republic of China (PRC) followed by the invasion of Tibet, caused security concerns for Nepal’s own existence (Jha, 2017). As a result, Nepal wiggled closer to India to try and contain Communist China outside of the Himalayas.


 Nevertheless, this concern partially gave way to acceptance in 1955, when Nepal established diplomatic relations with China. But acceptance did not necessarily create an atmosphere of engagement. Chinese soft power by way of Buddhism persisted. Yet, China could not or rather did not find other major ways to recapture its eroded soft power within the Nepalese state. What changed the course of the matter in the slightest of ways was the 1975 Indian accession of Sikkim into the state. This pushed Nepal to diversify its partners. While this did not cause an entire change in momentum, this opened a space that was attempted to be filled with partners other than India. Soon, Nepal began to improve its trade with China, beginning with arms (Ranjitkar, 2006). China was also keen on assisting Nepal in infrastructural and human resource development by providing it with grants and loans. For Nepal that was increasingly worried about India’s intentions and uncurtailed influence, China grew to be an attractive alternative. Indeed, this affinity to China and Chinese influence saw a gradual increase from 1996 till 2008. During the time, King Gyanendra had usurped the Nepali government to push back against the Maoist insurgency. When India refused to provide arms to the Nepali government, China assumed that role, furthering its significance for the state and its government apart from the public (“South Asia - Chinese deliver arms to Nepal '', 2005).


Thus, towards 2008, one notices a visible strain in the soft power of India within Nepal, which it had enjoyed uninterrupted so far. One also witnesses the increasing presence of China in Nepal, laying the stones for retracing its once-lost means and forms of soft power. Nevertheless, Nepal was still by and large, tilted to the traditional Indian influence in the subcontinent.


The History of Soft Power Contest (2008- till date)

However, this tilt suffered a drastic blow in 2008, with the ascension of Maoists to power in Nepal. From 1996 till 2006, Nepal saw a protracted civil war between the Nepalese Royal Government and Communist Party of Nepal (Maoist). At least from 2005, the maoist rebels received support from the Indian government in what was often described as a fight against the autocratic monarchy in Nepal (Lawoti & Pahari, 2012). Meanwhile, China was vocal in assisting the Nepalese monarchy in suppressing the anti-Maoist insurgency (“South Asia - Chinese deliver arms to Nepal”, 2005). But once in power, the Maoists led by Prime Minister Pushpa Kamal Dahal were keen on revitalising their ideological relations with Communist China. Moreover, the immediate need to neutralise the overt Indian influence- as exposed by the very ascension of the new party at the behest of Indian efforts- was felt by the Nepalese government and the public alike. The unparalleled growth of China as an insurmountable economic power in Asia was also a pulling factor to the cause. Nepal was keen on rebuilding itself in a model that was already proven to be successful. Recognising the Nepalese interest and taking note of its own need for a strategic partner in the key Himalayan location, China was quick to engage Nepal at economic, social, cultural, and political levels.


As a result, China and Nepal have been growing closer than ever since 2008. In 2014, China surpassed India as the largest source of Foreign Direct Investments in Nepal (Krishnan, 2016). Chinese businesses in Nepal are on an increasing scale. Nepal has also witnessed an immense surge in infrastructure projects economically and/or technically funded by China. This includes hydroelectric projects, telecommunication, aviation, and connectivity. Not to forget that Nepal has partnered with China in its prestigious Border Road Initiative (BRI), despite the concerns of western countries and India alike (Baruah , 2017). Moreover, the duo has either opened up or is intending to bring in more trade and transit routes like the Xigaze-Gyirong-Kathmandu network and the Gyirong-Lumbini network in an attempt to cut down Nepal’s reliance on India for trade and transport. Not to say, from 2016, China has allowed Nepal to have access to three of its dry ports- Lanzhou, Lhasa, Xigatse and another four seaports- Tianjin, Shenzhen, Lianyungang and Zhanjiang (Sigdel, 2018). While their economic implications for Nepal have been identified and accounted for, what is often left out is the extent of soft power these projects reward China with. Today, China has developed a positive outlook in Nepal by making economic inroads and without indulging itself in the latter's internal or political affairs. While economic aid has factored in significantly, it is also the perception of China as a benevolent superpower and a model of development that is driving this positive approach (Muni & Tan, 2016). Undeniably, the grass seems to be greener on the Chinese side at present. Nepal envisions its own developed self in China and recognises the accompanying Chinese sphere of influence as enhancing to its own aspirations. The recent rise in the penetration of the Chinese language and culture in Nepal is a testament to this perception. More and more educational institutions are adopting Mandarin as a mandatory lesson in the hope of knowing more and emulating more of its affluent Northern neighbour (Gauttam et al., 2021). An increasing number of Nepalese students are visiting China for higher education. This is apart from the growing exchanges between the duo through academic, political, business, official and related delegations (Muni & Tan, 2016).


This does not mean that Nepal has entirely pushed away India as a strategic partner. India still holds more than enough soft power that is markedly distinctive from the recently shaped-up Chinese influence. Moreover, India has been contesting the Chinese influence by revitalising and reinstating its special relationship with Nepal. It has repeatedly remarked on the age-old traditions, sociocultural resemblances, belief system, and societal structures to pull back Nepal to itself. Yet, Nepal is drawing an obvious line between what it observes as India’s ‘selfish’ approach and China’s ‘benevolent’ nature. As it has repeatedly maintained, Nepal is intent on keeping a neutral relationship with both nations. But at a time when India lacks an overt material success that would make Nepal voluntarily turn to it for guidance; India’s attempts at rejuvenating the means of maintaining and acquiring soft power are largely thwarted. This causes an effective tilt in Nepal’s position and to its Northern neighbour.


Implications of the contest

In the contemporary context, where soft power and persuasion have largely replaced military superiority or coercion as the primary means of exerting influence, these Chinese gains in Nepal have more implications than are easily visible. True, the contest for soft power in the region is immediately guided by concern for one’s own territorial integrity and security. A Chinese sphere of influence past the Himalayas tampers with the security strategy of India. This is the foremost cause, bringing India to directly counter the soft power of China in the region. In global geopolitical considerations, however, Nepal’s slip into the Chinese sphere of influence constitutes a larger concern for the rest of the nations. Contemporary geopolitics understands China as a rising power in the region. Nepal is another country where China wants to extend its influence and exert its power. Therefore, containing the growth of Chinese soft power in Nepal comes as part and parcel of the attempts to contain China’s growth as a regional hegemon. This is especially so, given that soft power and not economic or military might has been the main handicap to China’s rise in power. Therefore, while the proxy war in Nepal between India and China portrays the realistic tendencies of states in maintaining their spheres of influence, it also transcends the security concerns of the giants and offers a peek into global geopolitical concerns.


But the implications appear to be less grave for Nepal, which is predicted to gain better by leveraging itself between India and China. For one, Nepal can enhance its independent decision-making capabilities as a sovereign state by maintaining a neutral position. It need not bend over backwards to meet its needs, given that it has more than one strategic partner competing for prominence in the state. Similarly, the situation also warrants that the giants will be more accommodating of Nepal’s economic demands and aspirations. Two, balancing between India and China will open up diverse trade and transport routes for the landlocked country. Further, it can also enhance the momentum within the Nepalese economy, owing to the engagement with both of its bigger neighbours. Third, Nepal has the opportunity to act as a bridge between India and China by striving to bring the duo to the table. It can thus elevate its role as a significant diplomatic force in the region. Amidst all these advantages, however, it is also imperative for Nepal to assess the long-term effects this position will have on Nepal as a sovereign nation. In the end, both India and China are looking to gain influence within the state.



Soft Power has always existed and thrived in global geopolitics. But in today’s world, it is receiving unprecedented attention as the most effective tool for attaining influence and power over other entities. Nepal, being a strategic location significant to both China and India, is a primary example of the soft power contest occurring between states. Historically, both China and India have exercised soft power in the region, even if outside of an established framework. Owing to the geographical and other sociocultural resemblances, India has had a bit of an edge in accumulating influence in that case. However, Buddhism, as a prominent religion in both China and Nepal, has ensured that China does not lag behind much farther. But in the modern history of these nations, beginning from the early 1950s, one witnesses soft power being contested for and exerted in varying means and degrees. However, the establishment of the People's Republic of China damaged the otherwise uninterrupted relationship between Nepal and China. While this relationship was slowly built from the 1950s, it was only from 2008 that China could garner momentum for its accumulation of influence within the hilly nation. This was contrary to the kind of relationship and extent of influence that India had with Nepal. From the 1950s to 2008, India maintained an enviable sphere of influence across Nepal, barring a few events. But 2008 saw India slowly losing its influence to China, which had its economic model to pull Nepal towards itself. This change in momentum could also be attributed to the unrestrained authority that India demanded in Nepal. Today both countries are contesting against each other for garnering and exercising soft power in the state, and it seems that China is better off. Still, Nepal is bound to gain economically by positioning itself at an equal distance from the duo. This is apart from the political and diplomatic gains. However, the long-term impact of such a position on the sovereignty of Nepal is yet to be assessed.



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