(C) NEPAL FM: IF NOT INDIA, HOW ABOUT CHINA?

C O N F I D E N T I A L SECTION 01 OF 02 KATHMANDU 000870

SIPDIS

E.O. 12958: DECL: 09/20/2019
TAGS: PGOV PREL PREF CH NP
SUBJECT: (C) NEPAL FM: IF NOT INDIA, HOW ABOUT CHINA?

REF: A. KATHMANDU 852

B. KATHMANDU 863

Classified By: Charge d' Affaires, a.i., Jeffrey A. Moon. Reasons 1.4 (
b/d).


1. (C) Summary: During Foreign Minister Koirala's recent
trip to China, Chinese officials expressed continuing
"concern" about the activities of Tibetan refugees in Nepal.
China promised Koirala only a handful of small-sum
infrastructure projects. The Indians are "not happy" with
Nepal's cooperation with the Chinese, Koirala said. She
complained that India has promised development aid for years
but never delivered. The Chinese requested that Home
Minister Bhim Rawal travel to Beijing to discuss border
security issues. End Summary.

Chinese "Concern" about Tibetan Refugees
--------------

2. (C) During a September 15 meeting, Foreign Minister Sujata
Koirala briefed Charge on her September 8-13 trip to China.
(Note: Charge also raised the IAEA Israel resolution (ref A)
and Kosovo UNGA request (ref B). End note.) Koirala said
that every Chinese official she met, including her
counterpart Foreign Minister Yang Jiechi, expressed "concern"
about the activities of Tibetan refugees in Nepal. The
Chinese want to "make sure" the estimated 20,000 - 25,000
Tibetan refugees in Nepal will not "create problems."

Old Deals/New Promises
--------------

3. (C) Koirala highlighted the signing of three economic
agreements with the Chinese: improving roads in Kathmandu,
purchasing sanitation trucks, and funding a "dry dock" in the
border town of Tatopani. According to the Foreign Minister,
the Chinese originally negotiated these agreements with the
Maoist-led government. Koirala said that she was "lucky"
former Prime Minister Dahal resigned before he could finalize
the projects, so she had something to sign during this trip.
Koirala also discussed possible Chinese funding for a
trans-SAARC highway and the construction of a railroad from
Lhasa to the Nepali border. (Building a railroad between the
Chinese border and Kathmandu is a longer-term project,
Koirala said.)

Indian Promises, Chinese Money?
--------------

4. (C) The Government of India is "not very happy" with
Nepal's cooperation with China, Koirala admitted. (Note:
Koirala had met with Indian Foreign Secretary Nirupama Rao,
who is visiting Nepal, the previous day. End note.)
Whatever India thinks, Nepal's priority is development,
Koirala stressed. India has promised funding for development
projects for many years, but never delivered. The Foreign
Minister's father, G.P. Koirala, told his daughter not to
trust Indian offers of assistance. "Why not ask China?"
Koirala mused, "perhaps they will follow through on their
promises."

Send Home Minister for Border Talks
--------------

5. (C) The Chinese also committed to providing additional
border security assistance, particularly communications
equipment. Chinese officials requested that Home Minister
Bhim Rawal travel to Beijing as soon as possible to discuss
the details of the assistance package and other border
security issues.


6. (C) Comment: Often called a "yam between two boulders,"
Nepal has tried to play China off against India for decades.
The Foreign Minister has told Charge on at least two previous
occasions that she regards China as a useful counterweight
that can be used to respond to pressure from India. The
paltry Chinese development projects offered Koirala suggest
that the Chinese are not keen to play that game -- at least
not with this weak Foreign Minister (and perhaps not with the
current unstable Nepali government). On the key border

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security issues, the Chinese apparently prefer to deal with
Home Minister Bhim Rawal. Unlike Koirala -- who has her
position solely because she is the daughter of Nepali
Congress party leader G.P. Koirala -- Rawal is a respected
and capable politician. End Comment.
MOON