India’s Strategic Engagement with the Landlocked States of South Asia: A Critical Assessment with Special Reference to Nepal and the Role of External Powers
Introduction
India’s strategic engagement with the landlocked states of South Asia—Nepal, Bhutan, and Afghanistan (prior to the Taliban’s takeover)—forms a vital component of its regional security doctrine, economic diplomacy, and neighbourhood-first policy. These states occupy crucial geostrategic spaces at the interstices of South, Central, and East Asia, and play an important role in India’s geopolitical calculus vis-à-vis China, regional connectivity, hydro-political interests, and internal security.
Among these, Nepal stands out due to its unique cultural affinity with India, shared civilizational history, open border arrangements, and long-standing socio-economic interdependence. However, India’s engagement with Nepal and other landlocked neighbours has been complicated by the increasing influence of external powers—particularly China’s infrastructural assertiveness, the United States’ strategic overtures, and the European Union’s normative diplomacy. These shifts have led India to recalibrate its strategic posture, reassess its bilateral engagement templates, and redefine its regional hegemony.
This essay critically evaluates the nature and limitations of India’s strategic engagement with the landlocked states of South Asia, with a special focus on Nepal, and assesses how great power incursions have reshaped India’s regional imperatives.
I. Strategic Significance of Landlocked States in India’s Regional Doctrine
1.1 Geographic Determinism and Strategic Depth
India’s landlocked neighbours serve as geographic buffers against both conventional and non-conventional threats:
- Nepal and Bhutan lie at the Himalayan frontier, acting as buffers between India and China. Their territorial and political stability is critical to India’s northern border security.
- Afghanistan, although disconnected by Pakistan, has historically been viewed as part of India’s extended strategic neighbourhood, especially for counterbalancing Pakistan’s western ambitions.
These states therefore influence India’s territorial sovereignty, defence posture, and regional deterrence strategies.
1.2 Connectivity and Regional Integration Imperatives
India’s outreach to landlocked states is also shaped by economic and developmental logic:
- Through projects like the India–Myanmar–Thailand Trilateral Highway, BBIN (Bangladesh–Bhutan–India–Nepal) Motor Vehicles Agreement, and Kaladan Multi-modal Transport Project, India seeks to transform the subcontinent into a connectivity corridor.
- For landlocked states, India provides the only viable access to sea routes, positioning itself as a logistical and trade partner.
- India also invests in energy diplomacy, particularly hydropower projects in Bhutan and Nepal, leveraging shared river systems.
Thus, India’s strategic engagement is deeply linked to functional regionalism and economic interdependence.
II. Nepal as a Strategic Pivot: Historical Ties and Emerging Frictions
2.1 Civilizational Bonds and Structural Asymmetry
India and Nepal share deep civilizational, religious, and cultural ties:
- The 1950 India–Nepal Treaty of Peace and Friendship institutionalized an open-border policy, free movement of people and goods, and mutual defence cooperation.
- India remains a principal trade partner and development donor, supporting sectors like infrastructure, energy, education, and health.
However, this structural asymmetry has also bred resentment in Nepal, with sections of its political elite viewing Indian engagement as hegemonic and interventionist. This has fueled periodic anti-India sentiment, especially during blockade-like situations (e.g., 2015–16 unofficial blockade) and constitutional disputes.
2.2 Strategic Vulnerabilities and the Rise of External Actors
The last two decades have witnessed a marked shift in Nepal’s foreign policy orientation, prompted by the emergence of external powers:
III. China’s Expanding Influence in Nepal
3.1 Belt and Road Initiative (BRI) and Strategic Penetration
Nepal formally joined China’s BRI in 2017, seeking infrastructure investments and connectivity alternatives:
- China has funded roads, transmission lines, dry ports, and airport expansions, including the Pokhara International Airport.
- Strategic projects like the Trans-Himalayan Multidimensional Connectivity Network envision rail links from Tibet to Kathmandu, potentially bypassing India entirely.
These developments challenge India’s traditional monopoly on Nepal’s trade and transit, raising concerns about Chinese dual-use infrastructure and PLA-linked projects near the Indian border.
3.2 Political Influence and Normative Realignment
China’s engagement has not remained limited to infrastructure:
- Beijing has cultivated ties with multiple political factions, including communist coalitions in Nepal.
- Its non-interference rhetoric and economic largesse are viewed favourably by sections of Nepal’s elite, especially when juxtaposed with India’s perceived intrusiveness.
This has altered the balance of power in Kathmandu, compelling India to refine its diplomatic messaging and engagement mechanisms.
IV. Role of the United States and European Union
4.1 U.S. Strategic Outreach: MCC and Indo-Pacific Narrative
The United States’ Millennium Challenge Corporation (MCC) compact with Nepal (worth $500 million) sparked significant domestic controversy:
- While India initially maintained a distance, it recognized that opposition to MCC was being leveraged by anti-U.S. and pro-China elements.
- The U.S. also includes Nepal in its broader Indo-Pacific strategic architecture, emphasizing democratic resilience, transparency, and countering Chinese influence.
India’s strategic calculus now incorporates indirect U.S.–China contestation in Nepal, requiring nuanced balancing without overt alignment.
4.2 EU’s Normative Diplomacy
The European Union, while less overtly strategic, promotes democracy, human rights, and federalism:
- Through its electoral assistance and civil society engagement, the EU shapes Nepal’s internal political discourse.
- While not directly challenging India, EU support for pluralistic and autonomous state-building sometimes diverges from India’s preference for a unitary Nepali polity amenable to Indian interests.
Hence, EU influence contributes to normative pluralism in Nepal, which dilutes India’s traditional narrative dominance.
V. India’s Strategic Recalibration in Response
5.1 Re-engaging Nepal Through Soft Power and Infrastructure
Recognizing the strategic drift, India has renewed efforts at development diplomacy:
- Prime Ministerial visits, high-level dialogues, and expedited project implementation (e.g., cross-border petroleum pipeline, integrated check posts) have been prioritized.
- India’s emphasis on Ramayan tourism circuit, educational scholarships, and digital connectivity seeks to revive civilizational and people-centric ties.
This marks a shift from transactional engagement to cultural soft power and trust-building.
5.2 Pragmatic Engagement Despite Strategic Setbacks
India has also adopted a more pragmatic tone:
- The reopening of dialogue after the 2015 constitutional tensions, resolution of territorial disputes (Kalapani–Lipulekh) through diplomatic channels, and acceptance of Nepal’s multi-vector foreign policy indicate greater strategic maturity.
- India no longer insists on exclusivity, but seeks to remain Nepal’s partner of first choice.
This evolution from hegemonic posturing to competitive coexistence reflects India’s broader adaptation to multipolarity in its near abroad.
Conclusion
India’s strategic engagement with the landlocked states of South Asia, and particularly with Nepal, is shaped by a combination of historical proximity, geopolitical imperatives, and evolving regional dynamics. While India retains considerable leverage—economic, cultural, and strategic—the entry of external powers has forced a recalibration of its traditional posture. The expanding footprint of China, the U.S., and the EU in Nepal challenges India’s hegemonic comfort zone and demands a more agile, inclusive, and norm-sensitive diplomacy.
Ultimately, India’s regional aspirations in South Asia will depend on its ability to lead without coercion, engage without conditionality, and build durable partnerships in a region where sovereignty consciousness and external options are growing. The Nepal case illustrates both the vulnerabilities and adaptive potential of Indian foreign policy in a rapidly shifting geopolitical theatre.
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