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.

Nepal must move from climate diplomacy to climate litigation, but with proof, not in haste

Prime Minister Balendra Shah (Balen) is set to travel to New York for the 81st session of the United Nations General Assembly (UNGA). The visit comes amid intense pressure in the aftermath of the Bhotekoshi-Trishuli River basin flash floods, a disaster that has claimed thousands of lives and left thousands more missing.
Though the UNGA is scheduled to begin on September 8, the high-level general debate will begin on September 22. And the visit of PM Shah is not only going to the first out of country official visit as he has not made a foreign visit since taking charge on March 27, but also will mark the shift in diplomacy as he is going to voice the concern of Nepal’s story of climate disaster despite Nepal’s less or no contribution to global carbon emission.
For decades, Nepal has gone to the world’s climate conferences or UNGA with the same message: we are among the countries most exposed to climate change, yet we have contributed almost nothing to the problem.
The message is true. But it is also no longer enough.
Nepal’s latest Himalayan catastrophe – as named ‘Himalayan Tsunami’ by some of the global media – has made the limits of conventional climate diplomacy brutally clear. The August 26 glacier-related disaster along the Nepal-China border has killed hundreds, left more than 5,000 still missing and inflicted extraordinary damage on infrastructure and livelihoods. Rescue operations have continued amid destroyed roads, bridges and hydropower facilities. Government’s preliminary estimates put reconstruction and rehabilitation needs at roughly $4 billion to $5 billion – close to a tenth of the country’s economy – while the latest reported assessment puts direct losses at about $2.56 billion.
The figures itself explains that this is not simply another natural disaster.
Scientists increasingly understand that a warming climate is destabilizing glaciers, permafrost and mountain slopes, increasing the risks of avalanches, glacial lake outburst floods, landslides and cascading disasters across the Hindu Kush Himalaya. Recent research on Nepal also finds that some extreme rainfall and heat events have become substantially more likely because of anthropogenic climate change.
Nepal therefore faces a strategic choice.
It can continue asking the international community for greater climate finance, stronger adaptation support and solidarity. Or it can begin asking a more difficult question: Who should pay for the losses that climate change is imposing on countries that did little to cause it?
The answer requires Nepal to move from climate diplomacy to compensation diplomacy, and eventually, where the legal and scientific evidence permits, to climate litigation.
This is not a call for confrontation. It is a call for a different conception of climate justice.
For years, Nepal has presented itself primarily as a vulnerable country. That identity has helped bring international attention and some financial support. But vulnerability without enforceable claims can easily become a permanent political condition: the vulnerable ask, the powerful promise, and the money arrives slowly, conditionally or inadequately.
Nepal should now become more than a country seeking assistance.
It should become a country asserting a claim.
The distinction matters.
The international climate regime has already recognized the principle of loss and damage. The creation of the Fund for Responding to Loss and Damage marked an important institutional development. Yet establishing a fund is not the same as ensuring that countries suffering irreversible climate-related losses receive adequate compensation.
Nepal should therefore stop treating loss and damage as another development-finance programme.
It is a question of justice.
Consider the arithmetic. Nepal builds a road, bridge or hydropower plant with scarce domestic resources or borrowed money. And one fine day, a climate-amplified disaster destroys it. The government then borrows again to rebuild. If another disaster follows, it borrows once more.
At what point does climate change become a debt crisis?
This is the hidden economic cost of climate change for vulnerable developing countries like Nepal. Climate disasters do not merely destroy assets. They destroy the fiscal space needed to build new ones.
Nepal cannot indefinitely finance climate losses through domestic taxation and sovereign borrowing.
Nor should it.
The first step toward changing this equation is deceptively simple: Nepal must start keeping the bill.
The country needs a national Loss and Damage Account that records, systematically and scientifically, the economic consequences of climate-related disasters.
That account should go far beyond destroyed roads and buildings. It should measure lost agricultural output, electricity generation, tourism revenues, employment, household assets, public revenue, migration, displacement, ecosystem services and the long-term effects on human capital.
It should also distinguish between the immediate physical damage and the wider economic losses that unfold over years.
Most importantly, Nepal needs to invest in attribution science.
International climate diplomacy increasingly depends on the ability to establish whether and to what extent a particular event has been influenced by anthropogenic climate change. A recent study on Nepal specifically argues that stronger attribution studies, better data systems and improved institutional coordination would strengthen the country's ability to access international loss-and-damage finance.
This is where Nepal's climate policy must become much more sophisticated.
Emotion can establish moral urgency.
But evidence establishes a claim.
Thus, Nepal should adopt the second step that is compensation diplomacy.
Nepal should build a coalition of countries facing comparable circumstances: least-developed countries, mountain states, small island states and other climate-vulnerable developing economies.
But the objective should change.
Instead of repeatedly asking wealthy countries to increase voluntary assistance, Nepal should push for predictable, accessible and adequate mechanisms for financing unavoidable climate losses.
That could include grants rather than loans, concessional reconstruction finance, debt suspension following major climate disasters, debt restructuring, disaster clauses in sovereign borrowing and automatic financing triggered by objectively measured climate events.
This would not be charity.
It would be an attempt to distribute an increasingly globalized risk more fairly.
Nepal's argument should also be grounded in the principle of common but differentiated responsibilities. Every country shares responsibility for addressing climate change, but historical contributions to atmospheric greenhouse-gas concentrations and national capacities to respond are profoundly unequal.
The country that contributed least cannot reasonably be expected to bear the entire cost of consequences produced by a global system it did little to create.
But diplomacy has limits.
That is where litigation enters.
Climate litigation should not be understood as Nepal's first resort. Nor should it become a theatrical exercise in naming and shaming major emitters.
It should be treated as a strategic instrument.
Nepal should establish a high-level Climate Litigation Task Force comprising international lawyers, climate scientists, economists, diplomats and constitutional and environmental law experts. Its first mandate should not be to file a lawsuit. It should be to determine whether a legally credible case exists.
What duties do states owe to countries exposed to climate-related harm?
What does international environmental law require regarding transboundary harm?
Can historical emissions be legally connected to specific categories of loss?
How should causation be established?
Can states claim remedies for climate-related harm through existing international judicial or quasi-judicial mechanisms?
These are difficult questions. The fact that they are difficult is precisely why Nepal should begin studying them now.
The objective is not necessarily to win a courtroom battle tomorrow.
The objective is to change the negotiating position today.
A country that possesses a credible legal strategy negotiates differently from a country that possesses only a moral appeal.
Nepal should understand this as leverage.
If a legal route is eventually found, it could be pursued. If it is not, the legal research would still strengthen Nepal's position in international negotiations by clarifying rights, obligations and evidentiary standards.
There is another dimension to this strategy.
Nepal should stop presenting the Himalayas merely as a fragile ecosystem in need of protection. The Himalayas should be understood as a global climate asset.
The region's glaciers and snowfields underpin water systems serving enormous populations across Asia. The stability of the Himalayan cryosphere matters not only to Nepal but to agriculture, energy, water security and human settlements far beyond its borders.
If the world considers Himalayan stability a global public good, the costs of protecting it cannot reasonably be assigned entirely to Himalayan countries.
Nepal should therefore propose an international Himalayan Climate Resilience and Loss and Damage Facility, financed through multilateral climate institutions and designed specifically for mountain risks.
“Such an initiative would finance glacier monitoring, early-warning systems, resilient infrastructure, scientific research and, crucially, unavoidable losses,” geologist Shree Kamal Dwevedi argues, adding that it would turn Nepal's vulnerability into diplomatic leverage.
But there is an important caveat. “Nepal must not turn climate litigation into a geopolitical weapon against either of its neighbors.”
The recent disaster occurred in a sensitive transboundary Himalayan environment. Questions about glacier instability, early-warning data, infrastructure and disaster information sharing deserve serious investigation. But attribution must not be confused with political accusation.
A serious climate claim requires evidence.
Nepal must therefore invest in precisely that evidence: satellite monitoring, glacier and permafrost research, hydrological data, hazard mapping, event attribution and transparent disaster accounting, he adds.
In future climate diplomacy, data will be power.
Nepal's diplomats should be able to arrive at international negotiations not merely with photographs of destroyed villages, but with a quantified claim, a scientific attribution assessment, an economic model and a legal memorandum.
That would change the conversation.
The country's message would no longer be: We are poor and vulnerable. Please help us.
It would become: We have suffered measurable losses from a global climate crisis. Here is the evidence. Here is the economic cost. Here is the legal basis for responsibility. Here is what a fair international response should look like.
That is the difference between aid-seeking diplomacy and rights-based diplomacy.
Nepal should also recognize that climate litigation is not necessarily about suing fossil-fuel companies or industrialized states for every disaster. The legal landscape is too complex for such simplistic claims. The more credible path may involve strategic litigation, advisory opinions, international legal interpretation and domestic legal action that establishes duties of prevention, disclosure, adaptation and protection.
The point is to create accountability where conventional diplomacy has failed to do so.
Nepal has been patient.
It has participated in climate negotiations. It has adopted national plans. It has pledged ambitious environmental goals. It has repeatedly highlighted the vulnerability of the Himalayas. Yet the gap between climate promises and climate finance remains enormous. Nepal estimates that implementing its adaptation priorities and climate commitments will require tens of billions of dollars.
The country cannot continue financing an international climate crisis from its own limited fiscal resources.
The August 26 disaster should therefore become a turning point.
Nepal needs a national Climate Justice and Compensation Strategy with five pillars: systematic loss-and-damage accounting, scientific attribution, compensation diplomacy, legal preparedness and strategic litigation.
The shift is conceptual as much as institutional.
Climate diplomacy asks the world to listen.
Compensation diplomacy asks the world to contribute.
Climate litigation asks the world to answer.
Nepal should be prepared for all three.
The Himalayas are warning us that the climate crisis is no longer a distant environmental problem. It is a question of national solvency, human security and international justice.
Nepal did not create this crisis.
But Nepal is paying for it.
The time has come to send the bill back to the world.
And PM Balendra Shah is expected to do the same in the 81st UNGA !!!
(Frist published in nepalkhabar.com -- https://en.nepalkhabar.com/news/detail/19696/)

After 50 years, Nepal to graduate from LDC

After being in a category of least developed country (LDC) for five decades since 1971, Nepal is finally graduating to the developing country category as the United Nations General Assembly (UNGA) on Wednesday approved a proposal of Nepal's graduation to a middle-income developing country by 2026.

The 40th plenary of the 76th Session of the UNGA unanimously adopted a resolution endorsing the graduation of Nepal from the LDC category with the preparatory period of five years, according to press note issued by the Permanent Mission of Nepal to the United Nations in New York.

"As a result, Nepal will graduate from the LDC category by December 2026 and until then will continue to receive all concessions and support measures as LDC,” the press note reads.

In addition to Nepal, the graduation of Bangladesh and the Lao People’s Democratic Republic has also been endorsed by the UNGA.

Nepal now needs to prepare smooth national transition strategy, with the support of the UN system and in cooperation with their bilateral, regional, and multilateral development and trading partners. After the graduation from LDC category, a country will not get grant, and also loses preferences it is getting as LDC, thus pressuring for strong domestic production base.

After the adoption of the resolution, permanent representative of Nepal to the UN Amrit Bahadur Rai reiterated Nepal’s commitment to making all-out efforts for a smooth graduation with the enhanced level of support from the development partners, including the UN system. "Nepal graduating from LDC status in 2026 is a great milestone, indeed," he added.

But Nepal should make efforts that it won't slip backwards. Rai also pledged for Nepal to do its best to undertake all required procedures for its structural changes for the same within the next five years. "The Government of Nepal has completed strategic efforts for the graduation," he said, adding that it is an opportunity for the country to raise its image in the international forum by creating structures for its economy within the next five years. "We have also urged for addressing challenges that may emerge after 2026, and will reach a conclusion to this effect after holding a dialogue with development partners."

Nepal has twice deffered its graduation due to devastating earthquake in 2015 and lack of preparation in 2018. Usually, graduation from LDC status becomes effective three years after the UNGA takes note of the recommendation made by the Committee for Development Policy under the United Nations Economic and Social Council to graduate a country. But due to Covid-19 pandemic, this time, the countries have been given five years of preparatory period on an exceptional basis.

The five-year preparatory period, however, is provided for a smooth transition, recognising the effect of the Covid-19 pandemic and the resulting need to implement policies and strategies to reverse the pandemic’s damage to the economic and social sectors, the press note reads.

The resolution has mandated the Committee on Development Policy, a subsidiary body of the Economic and Social Council, to analyse the adequacy of the preparatory period at its 2024 triennial review and recommend further extension, if necessary, the press note adds.

In the last two triennial reviews conducted in 2015 and 2018, Nepal had met two of the three criterion related to the human asset index (HAI) and economic vulnerability index (EVI), though it couldn’t meet the per capita income (PCI) criteria. A country must have HAI more that 66 to graduate from LDC. But Nepal has scored 68.7 in 2015, 71.2 in 2018, and 75 in 2021. Likewise, a country must have EVI less than 32 to graduate. Nepal has scored 26.8 in 2015, 28.4 in 2018, and 24.2 in 2021.

A country becomes eligible to graduate from LDC after meeting two of the three criterion but a country can also graduate on the basis of per capita income alone, if it can meet the PCI creteria. The gross national per capita income of a country needs to be at least $1,222 for it to be accorded developing country status, according to the UN. But Nepal’s per capita income stands at $1,027 in 2021, whereas it had $745 in 2018, and $659 in 2015, according to National Planning Commission (NPC) data presented at the UNGA.

Infrastructure gap in LLDCs high

The infrastructure gap in Landlocked Developing Countries (LLDCs), compared to other countries, is the highest, according to a minister.
Foreign Minister Pradeep Kumar Gyawali – addressing the annual Ministerial Meeting of the LLDCs today in New York – also highlighted the need of building connectivity, including through durable and effective partnership between and among LLDCs and their transit and development partners.
The foreign ministers and other high-level representatives of LLDCs and transit as well as development partners and UN system entities attended the meeting.
Gyawali, on the occasion, held separate bilateral meetings with his counterparts of Bahrain, Norway, Saudi Arabia and Venezuela on the sidelines.
In the meeting with minister of Foreign Affairs of Bahrain Khalid bin Ahmed Al Khalifa, the two sides discussed various matters of common concerns, from labour relations to promotion of trade, tourism and investment. The two ministers, on the occasion, agreed to expedite pending agreements and further work closely for more cooperation and collaboration, including through exchanging high-level visits.
Likewise, discussing with minister of Foreign Affairs of Saudi Arabia Dr Ibrahim bin Abdulaziz Al-Assaf, Gyawali focused on strengthening bilateral relations through more cooperation and collaboration between the two countries. The two ministers also agreed to expedite finalising agreements that are currently in the pipeline.
The Nepali delegation – led by Gyawali – to the 74th session of the United Nations General Assembly (UNGA) took part in a series of high-level meetings on the sidelines.
During the meeting with the Norwegian minister for International Development Dag Inge Ulstein, Gyawali focused on areas of cooperation, including in investment as well as collaboration at multilateral forums like the UN. They also shared their views on various international issues, particularly climate change.
Similarly, the foreign minister and his Venezuelan counterpart Jorge Alberto Arreaza Montserrat exchanged views on various matters of mutual interest.
Later in the evening today, the minister participated in a ‘High-level Dialogue on Peace Operations: Enhancing Partnerships between the UN and International, Regional and Sub-Regional Organisations’ organised by the International Peace Institute (IPI) and expressed Nepal’s commitment to continued participation at UN peace operations with a view to further contributing towards global peace and stability.

Foreign Minister to leave for UNGA

Minister of Foreign Affairs Pradeep Kumar Gyawali is leaving – leading a Nepali delegation to the 74th Session of the United Nations General Assembly (UNGA) – for New York on Saturday, according to a press release issued today by the Ministry of Foreign Affairs.
The foreign minister – accompanied by his spouse Mrs Saraswoti Gyawali – will lead the delegation comprising of senior officials from the Ministry of Foreign Affairs, ambassador of Nepal to the United States of America (USA) Arjun Kumar Karki, Permanent Representative of Nepal to the UN Amrit Bahadur Rai and other officials from the Permanent Mission of Nepal to the UN in New York.
The General Debate of the UNGA will begin on September 24 under the theme ‘Galvanising Multilateral Efforts for Poverty Eradication, Quality Education, Climate Action and Inclusion,’ but Gyawlai will address the UN General Assembly on September 30.
On September 26, minister Gyawali will chair the Informal Session of the SAARC Council of Ministers, the press note reads, adding that he will participate in the Climate Action Summit, UN High-level Political Forum on Sustainable Development, and the UN High-level Dialogue on Financing for Development on the margins of the UNGA.
Likewise, minister Gyawali will address separate ministerial meetings of the Non-Aligned Movement (NAM), G77 and China, Least Developed Countries (LDCs), and Land-locked Developing Countries (LLDCs), while in New York, apart from representing also Nepal at the Ministerial Meeting of the Asian Cooperation Dialogue (ACD).
The foreign minister will also address the 10th Ministerial Meeting of the UN Group of Friends of Mediation and High-level Dialogue on Peace Operations, according to the press note. “He will participate in the high-level commemorative event convened by the president of the General Assembly to mark the 30th anniversary of the adoption of the Convention on the Rights of the Child,” the press note further reads, adding that minister Gyawali will attend the reception to be hosted by the US president on September 24 evening, and will join the State Luncheon hosted by the UN secretary general the same day. “On the sidelines of the UNGA, he will be engaged in bilateral meetings with his counterparts from various countries.”
The foreign minister is also scheduled to interact with Nepali Diaspora in New York on September 26, and attend an interactive meeting on brain gain with the Nepali diaspora community on the September 29 in Chicago. He will return to Kathmandu from New York on October 1.

ECOSOC forum calls for multilateral trading system reform

The 2019 Economic and Social Council (ECOSOC) financing for development forum opened yesterday where the participants called for efforts to reform the multilateral trading system. Many of the attendees' speeches started with stating economic risks and tensions which the world currently faces.
ECOSOC president Inga Rhonda King said that "debt levels have risen, as has a vulnerability, stifling investment in developing countries, trade tensions meanwhile are dampening economic growth."
In his remarks, UN secretary-general Antonio Guterres spotlighted the threats posed by heightened global trade tensions, possible economic challenges and rising greenhouse, gas emissions.
UN General Assembly president Maria Fernanda Espinosa Garces said that the economic climate has worsened, which is among the most pressing global challenges. "Financial markets are volatile: 30 developing countries are at risk or facing financial difficulties, while trade imbalances have increased over the last year," she added.
The global expansion seen in recent years continues, but at a slower pace than previously anticipated, said deputy managing director of the International Monetary Fund (IMF) Zhang Tao also calling for efforts to produce stronger medium-term growth.
In order to address these challenges, multiple approaches, particularly those regarding trade system, have been suggested by the participants.
The multilateral trading system must be bolstered, with a focus on ensuring that capacity-building and technology transfer are carried out, the UNGA president said adding that developing countries must be prioritised.
Noting that there is time to close finance gaps, the UNGA president pressed countries that made official development assistance commitments to keep them.
"No issue looms larger than trade," Zhang said, calling for efforts to reform the multilateral trading system and to reduce tensions.
He also called for an urgent redesign of global taxation efforts, noting that the current situation of widespread tax evasion is especially harmful to developing countries. In addition, some 40 percent of those countries find themselves in a situation of debt distress, requiring more sustainable financing practices.
Chef de Cabinet and principal advisor to the World Trade Organisation (WTO) director-general Tim Yeend emphasised the important role of trade in generating the resources needed to finance the 2030 Agenda. He said that there is ample evidence of the importance of trade in helping countries harness growth for development, notably in supporting job creation, raising per capita income and reducing poverty.
The integration of developing countries into the multilateral trade system, by providing access to new technologies and investments, has catalysed a 'take-off', he stressed, noting the importance of ensuring that such gains are not undone by today's challenges, which are among the most complex in a generation.
Until tensions among the largest countries are resolved, economic uncertainty will likely persist, Yeend said, adding that there is the potential for improving the global trade forecast, but it depends on reducing tensions and focusing on charting a positive path forward for trade.