Nepal seeks to turn geography into strategic advantage, foreign minister says

NEW YORK: Nepal must turn its position between India and China into an economic, digital and strategic advantage rather than allow geography to constrain its ambitions, Foreign Minister Shishir Khanal said today.
Speaking at an Asia Society event - in the sidelines of United Nations General Assembly (UNGA) - in New York titled ‘Steering Nepal’s Future in Asia’s Rising Century,’ Khanal said Nepal should move beyond its traditional image as a small country and position itself as a bridge connecting Asian economies, markets and civilisations.
“Nepal is not small but is strategically located,” Khanal said, adding that the size of its neighbours should not become a limit to Nepal’s ambitions.
Khanal said Asia’s rise, with about 60 per cent of the world’s population and a large share of global economic activity, presented an important opportunity for Nepal. South Asia alone has a population of about two billion, he said, adding that Kathmandu could become a centre of the region’s economic and social transformation. "Our question is no longer how Nepal can survive between two large neighbours. Our question is how Nepal can create value between them and beyond them."
Nepal’s strategy should be based on what Khanal called “developmental autonomy”, with a national goal of becoming a middle-income country within 10 years and a high-income developed country by 2050.
He said Nepal would seek to expand its economic and diplomatic policy space through broader international engagement while deepening ties with India, China and other major partners.
With India, Nepal should connect its open border more closely with production and markets, Khanal said, advocating “thick connectivity and thin borders” through greater economic interdependence.
Nepal should also use its hydropower potential to support regional economic integration, he said. Clean electricity is already being exported to Bangladesh through India, while border economic zones could help connect Nepali production to global supply chains.
With China, Nepal should pursue long-term cooperation in roads, tunnels, dry ports, aviation, digital networks and cross-border railways, he said. “Connectivity should not be measured only by kilometres of infrastructure, but by the movement of goods, services, investment, tourists and opportunities."
He also called for greater Nepal-China cooperation on glacier monitoring, disaster early-warning systems, water data sharing, climate adaptation and resilient infrastructure. Such projects, he said, should be based on transparent financing, rigorous feasibility studies and value for money.
Khanal also placed climate change among Nepal’s strategic foreign-policy priorities following the devastating floods that struck the country on August 26.
He described the disaster as a “Himalayan tsunami” and said it had caused major damage to lives, property, trade routes, bridges and Himalayan settlements.
The disaster underscored the need for effective early-warning systems, water-data sharing, predictable grant-based climate finance and practical cooperation with neighbouring countries and international partners, he said.
Beyond its immediate neighbourhood, Nepal plans to expand partnerships with the United States, Europe, Japan, ASEAN and Gulf countries, Khanal said, describing Nepal’s roughly five million-strong diaspora as a strategic asset. "Its capital and expertise should be channelled into entrepreneurship, technology and national infrastructure rather than being viewed primarily as a source of remittances."
“We want to directly mobilise their capital and expertise in entrepreneurship, technology and national infrastructure,” he said.
Khanal said small and medium-sized countries also have a role in protecting international law, sovereign equality and a rules-based international order. “Nepal was a bridge between civilisations in the past, is an economic bridge in the present, and will become a strategic bridge in the future."
While Nepal’s future must ultimately be shaped by its own people, international partnerships would be essential to achieving its development goals, Khanal said, inviting investment and cooperation from the United States, Europe, ASEAN, Latin America and other partners.