With Bhutan siding with India, Beijing is in race with New Delhi to win over Kathmandu. Nepali PM Deuba is in India while China is preparing for Xi Jinping's Kathmandu visit in October.
Doklam standoff is well into its third month and there are no signs to suggest that India or China is ready to withdraw troops from the disputed site. China is apparently losing support from big international players like the United States, the United Kingdom and Japan but it is aggressively campaigning to win over Nepal.
Bhutan and Nepal are the two countries that have formed a buffer between India and China (ever since Tibet was annexed by China in 1949). While Bhutan continues to be on the Indian side of the diplomatic divide separating New Delhi and Beijing, Nepal has always looked for better bargain from its both big neighbours.
Nepal's Prime Minister Sher Bahadur Deuba is in New Delhi on a five-day state visit. India and Nepal today signed eight bilateral pacts after comprehensive talks between Prime Minister Narendra Modi and his Nepalese counterpart Sher Bahadur Deuba.
Deuba said that Nepal would "never allow any anti-India activities from its soil." But, he has not said anything on Doklam standoff to suggest that Nepal has reconsidered its neutral stand on the matter.
Earlier this month, Nepal's Foreign Minister Krishna Bahadur Mahara said, "We do not support any of our neighbours in this case" while referring to the Doklam standoff between India and China. Mahara also said, "Nepal does not want to be dragged into the boundary dispute between India and China."
This statement signals China's growing strategic depth in Nepal.
CHINA'S GROWING INFLUENCE IN NEPAL
It was in 1961 when Nepal's King Mahendra toured China on a 15-day state visit which raised an alarm in New Delhi with the then Prime Minister Jawaharlal Nehru expressing his unhappiness over the development. It was seen as an attempt by Nepal to use China as a bargaining tool while dealing with India.
This became the standard policy of Nepal, which in return benefitted a lot from India. But, things have changed in the past few years when India-Nepal relations have been less than friendly. This provided China with an opportunity to get a foothold in Nepal.
Even though Nepal's trade with China remains a small percentage of that with India, Beijing has developed close relations with Kathmandu. Despite India's objection, Nepal participated in the OBOR (One Belt One Road) initiative of China, which has proposed to build USD 8 billion-rail line connecting Lhasa in Tibet with Kathmandu.
China has opened more than 30 crossing points for trade and transport along the border with Nepal. China has provided broadband access to Nepal after a similar attempt with India ran into rough weather.
China has also promised to reconstruct the old trade route - now called the Rasuwagadhi highway and is now under-construction - for better connectivity between Nepal and Tibet. China provided petroleum to Nepal during 2015-16 when India-Nepal border was blocked.
NEPAL'S IRRITATION WITH INDIA
Differences between India and Nepal have worsened in recent years. Sher Bahadur Deuba's predecessor KP Sharma Oli was openly pro-China and repeatedly asked India not to over-assert itself on the Himalayan nation.
During September 2015-February 2016, India's border with Nepal remained closed. The protesting Madhesis were squatting on the border. They had taken to the streets in Nepal after the new Constitution came into being, alleging that they had been discriminated against. Nepal alleged that the blockade had tacit support from India.
The blockade caused severe crisis in Nepal, which had just been devastated by a massive earthquake. India had taken a leading role in rescue and rehabilitation of earthquake victims. But, the blockade led to anger among large sections of the Nepali population against India. In the wake of this, Nepal witnessed skyrocketing prices of petrol, diesel and all essential commodities.
RECENT FLOOD AND INDIAN DAMS
Like Indian states of Bihar and Uttar Pradesh, Nepal is also facing massive floods in which more than 150 people have lost their lives. Nepal has blamed India for the same.
Nepal accused India of constructing at least 15 dams and embankments along the 12-km stretch of the international boundary. It also said that India had not provided compensation to the affected Nepali people whose lands were submerged due to the Koshi Barrage. The Laxmanpur Barrage over the Rapti is another sore point for Nepal, which faces floods in the catchment area of the river.
Nepal is also unhappy about the tardy pace of progress on the hydel power projects promised by India - Arun III, Upper Karnali and Pancheshwar Multipurpose Project.
INDIA, CHINA IN DIPLOMATIC RACE FOR NEPAL
As the Doklam standoff continues, there seems to be a diplomatic race between India and China for Nepal. China made the first move with its ambassador in New Delhi making a "courtesy call" on his Nepali counterpart earlier this month.
The meeting between the ambassadors of China and Nepal in New Delhi was followed by a visit of Chinese Vice-Premier Wang Yang to Nepal. Wang Yang announced a Chinese assistance of USD 1 million to the flood victims of Nepal. China has already pledged USD 8.3 billion towards building roads and hydel power projects in Nepal against India's commitment of USD 337 million.
On India's part, External Affairs Minister Sushma Swaraj went to Nepal to attend BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) ministerial meeting. She met the top leadership of the country and is understood to have discussed Doklam.
But, the statement from Nepal after two high-profile visits from both its neighbours proclaimed neutrality on the matter. But, the matter does not end there.
Nepal's Prime Minister Sher Bahadur Deuba arrived in New Delhi yesterday when reports from Beijing suggested that Chinese President Xi Jinping would be visiting Kathmandu in October. Xi Jinping's visit to Nepal seems to have been planned by Beijing to shift the tilt of the diplomatic balance.
WHAT MORE CHINA EYES IN NEPAL
China is also actively supporting the anti-India groups in Nepal asking for a greater Nepal by the re-integration of Indian territories of Kumaon and Garhwal (in Uttarakhand), parts of Himachal Pradesh and Jammu and Kashmir. These regions were ceded by Nepal to British India in 1816 by the Treaty of Sugauli.
The diplomatic race between India and China becomes significant as there are two Doklam-like tri-junctions in Nepal - one at Kalapani-Lipulekh in western Nepal and the other at Jhinsang Chuli in eastern Nepal.
Jhinsang Chuli remains snow-capped throughout the year and has been less contentious. The Lipulekh tri-junction made headlines in 2015 as India and China signed a bilateral agreement to increase trade through the route attracting criticism from Nepal. While the chorus of voices is growing in Nepal to go out of India's "sphere of influence", China has come forward as a willing partner for the landlocked country.