Month: August 2017

Nepal’s Views on the Doklam Standoff

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Avadhi Patni, Research Intern, Institute of Chinese Studies, Delhi

The Doklam standoff between India and China has caused security, economic as well as political concerns for other countries of the South Asian region. This article explains general views and opinions of Nepal on the Doklam standoff. Nepal has signed a Treaty of Peace and Friendship with both India (Ministry of External Affairs 1950) and China (Friedrich Ebert Stiftung 1960). It has two tri-junction points with India and China and its dependency on both the countries raises security as well as economic concerns for Kathmandu.

One tri-junction point between Nepal, China and India is at Lipulekh in western Nepal and the other is at Jhinsang Chuli in eastern Nepal. Concerns for Nepal started in 2015 when India and China signed a bilateral agreement to increase trade through Lipulekh but without any consultation with Nepal. This tri-junction point is considered crucial by Nepal for developing it as an economic bridge between India and China. Following this event was the 2015-2016 India-Nepal border blockade. These incidents have created a popular opinion in Nepal about India being at fault in the current standoff in Doklam (Baral 2017).

A statement by Gopal Khanal, the foreign policy advisor to the ex-Prime Minister K.P. Sharma Oli, Continue reading “Nepal’s Views on the Doklam Standoff” →

Opening Doors Southwards: China’s Increasing Presence in Nepal

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Aakriti Vinayak, Research Intern, Institute of Chinese Studies, Delhi  

China is making its influence keenly felt in Nepal today. China is using different strategies from road connectivity, hydroelectric projects to using soft power as an approach to forge linkages with Nepal. China’s concentrated effort to use soft power diplomacy in Nepal – with heavy investments in religion, education and tourism – has been a success on the high tables and between the government elites, relations have been institutionalised. One sees a prospective future for Nepal where there is an attempt to tilt more and more towards China – on almost every front – economic, cultural and regional. When Nepalese president Bidya Bhandari released the Nepalese edition of the book, Governance of China by Chinese president Xi Jinping, Upendra Gautam the General Secretary of China Nepal Study Centre said that the event befittingly heralds Nepal and China relations into the 21st century kinship where soft power plays a paramount role (Gautam 2016).

Under former Nepalese prime minister Prachanda, China started using Buddhism as a tool of soft power by Continue reading “Opening Doors Southwards: China’s Increasing Presence in Nepal” →

A China Gazer’s Random Musings – No. 1

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Amb. Kishan S. Rana (retd), Emeritus Fellow, Institute of Chinese Studies, Delhi

There is such a cascade of writing on China that as an oldie, I am attracted by the notion of penning personal reactions, reflections, and observations. Few of us can claim special insights into a country marked by both opacity and paradox. The longer one studies China, deeper is a typical realization that what one understands is a fraction of the things that remain unknown, even unfathomable. I plan to write this column perhaps once a month.

The 19th Party Congress Looms

For an authoritarian regime, China has a remarkable leadership transition system, which has worked smoothly for the past 30 years. Party congresses of the Communist Party of China (CPC) are held every five years. The even numbered Party Congress is when a new General Secretary and his leadership team take over; the country’s key decision-making team is the Standing Committee of the Politburo (it used to number 9, reduced to 7 in 2012). The General Secretary holds office for 10 years. The odd-numbered Congress is the one where appointments are made to the central committee and the full politburo, in preparation for the leadership change five years down the line.

Thus, the 19th CPC which meets in October 2017 is the in-between session when central committee and politburo members are appointed. It is crucial because that team plays the key role in the appointment of the next leader at the 20th Congress.

Recent months have seen sizeable re-shuffle in the top positions in the 31 provinces, Continue reading “A China Gazer’s Random Musings – No. 1” →

How Can China Deal with Pressure to Devalue the Renminbi?

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Zhang Ming, PhD, Director in the international investment research office of the Institute of World Economy and Politics, Chinese Academy of Social Sciences (CASS), Beijing

A version of this article was originally published in the Business Standard as ‘How China can resist devaluation pressure’, 29 July 2017. This is part of a series by Chinese economists facilitated by the ICS.

In July 2005, People’s Bank of China announced it was implementing a managed floating exchange rate system based on market principles and with reference to a basket of currencies.

From the end of June 2005 to the end of July 2015, RMB exchange rate against the US dollar rose to 6.12 from the previous 8.28, appreciating by about 26% (Figure 1). The RMB nominal effective exchange rate (NEER) and real effective exchange rate (REER) indices appreciated by 48% and 57% respectively over the same period (Figure 2).

That the appreciation of the REER of RMB exceeded its NEER indicates that the inflation level in China during this period was higher than the global average. Continue reading “How Can China Deal with Pressure to Devalue the Renminbi?” →