When Balendra Shah, popularly known as Balen, was first thrust onto the political stage, few could have foreseen that he, a rapper-engineer turned civic activist, would be poised to lead Nepal in the very near future. His transition from political outsider candidate to mayor of Kathmandu had already sent shockwaves throughout Nepal’s traditional political landscape. But the resounding victory of his party, the Rastriya Swatantra Party (RSP), positioning Shah, who defeated CPN (UML) chairman and four-time prime minister KP Sharma Oli with a margin of nearly 50,000 votes in the elections held on March 5, signifies much more than his individual success. It signifies a generational shift in Nepal’s politics and a new chapter in Nepal’s complex geopolitics.

Nepal has always been living in the shadow of the giants. Surrounded by India and China, and now with the US trying to win it over as well, Nepal is in a unique position where geography, economics, and politics converge. For all Nepali prime ministers, from the monarchic era to the current republican one, it has been a tricky balance to maintain. Shah is unlikely to be an exception in this regard either. Yet, the circumstances of his rise and the political movement he represents might imply otherwise.

A political earthquake at home

Balen’s rise to the national stage began with a wave of disillusionment among the Nepali public. For many decades, the Nepali political sphere has been monopolized by a few political parties and leaders, with one leader handing over the baton to another in the name of bringing reforms and change.

However, it is believed that the disillusionment among the Nepali public was violently expressed on September 9 last year, in response to the killing of 19 young people, including students in school uniform, with youth protests and demonstrations across the nation that toppled Oli’s government. Balen was the first choice for the interim Prime Minister, but he politely refused and former Chief Justice Sushila Karki was entrusted with the responsibility through an “election” on Discord where some 7,000 of the nearly 10,000 “voters” favored her.

The Karki-led interim government, however, deserves sincere thanks for successfully conducting the elections.

Back to Balen Shah. Balen’s political persona is believed to have been a perfect fit for the disillusioned Nepali public in the nation’s political sphere, as he is an engineer and not a politician, unlike many of his counterparts in Nepali politics who have been in the field for many decades and have been more ideologues than pragmatic leaders. His tenure as the mayor of Kathmandu has been one of the defining periods of his persona, earning him the reputation of “a man who rather likes to work than talk”, and giving him the political momentum.

Recently, when national elections approached, that momentum transformed into a broader movement. Balen’s party capitalized on the Nepali people’s appetite for change. Through the March 5 elections, the party positioned itself as the vehicle of a new political generation. The effect was a landslide victory that broke the monopoly of the traditional political parties of Nepal, including the Nepali Congress, CPN (UML), Maoists, and Madhesh-based political parties.

For many, the result was no less than a political earthquake.

Delhi watches closely

The internal upheaval in Nepal did not go unnoticed by the capitals of various countries across the globe, particularly the capital of India, New Delhi.

India and Nepal have had strong economic, cultural, and political ties in history. The two countries also have an open border that measures 1,800 kilometers. This border allows both peoples to travel freely and live in either country. Millions of Nepalis live and work in India, and India is a vital component of Nepal’s economy, apart from being the Himalayan nation’s largest trade partner.

As a result of this mutual dependency, significant political events in Kathmandu rarely go unnoticed in Delhi. Balen’s ascension to prominence is not an exception.

No sooner had the election results indicated Balen’s ascension to premiership than Indian Prime Minister Narendra Modi contacted Nepal’s new leadership, Balen and RSP Chairman Rabi Lamichhane, to express his congratulations and emphasize the value of bilateral relations.

Modi also wrote separate posts on the social media platform X (formerly Twitter) in both Nepali and English, stating that he had spoken with both leaders and that the Indian government remains committed to working with the incoming new government for mutual prosperity, progress, and shared interests.

Balen was quick to reply. “Thank you for your best wishes, Honorable Prime Minister Narendra Modi. I express my confidence that we will work together to make the existing historical, close and multifaceted relations between Nepal and India even stronger, deeper and result-oriented in the coming days. I would also like to extend my heartfelt congratulations to the Government and people of India for winning the World Cup title for the second time in a row,” he replied, in Nepali, to Modi’s post on X.

Meanwhile, commentators have offered various interpretations of Balen’s rise to power. One possible reading is that it presents an opportunity. A fresh face untainted by historical grievances that have occasionally marred India-Nepal relations could pave the way for practical cooperation.

A second reading is that Balen’s words and actions in politics occasionally had a nationalist undertone. He had, as Kathmandu’s mayor, grabbed headlines when he briefly prohibited the screening of Indian movies in Kathmandu amidst a row over the depiction of Sita in a Bollywood movie. Another instance is when a “Greater Nepal” map in his office sparked a debate in Indian media that saw it as a symbol of historical claims to Indian territories.

India has always maintained that its core concern is stability and continuity in the strategic orientation of Nepal. Traditionally, Nepal has maintained a balance of power between its northern and southern neighbors, but India has always viewed its political alignment as critical to its own security.

For Delhi, the question now is whether Balen will maintain that balance, or attempt to reshape it. A section of society accuses Balen of throwing “stunts” now and then. The peoples of the two nations sincerely hope that Nepal-India relations will be guided not by stunts but by a realistic sense of geopolitics.

Beijing’s quiet calculations

While India is certainly watching with keen eyes, China is no less interested in seeing how things unfold.

Over the past two decades or so, China’s engagement with Nepal has only intensified. From infrastructure development to trade agreements and development assistance, China’s engagement with Nepal has only strengthened. Nepal’s decision to join China’s ambitious Belt and Road Initiative (BRI) was seen as a symbol of its strengthening ties with China.

From China’s perspective, Nepal is of considerable strategic importance. First and foremost, it is seen as a buffer state in China’s sensitive Himalayan frontier. Nepal is also part of China’s larger strategy of containing Tibetan politics in neighboring countries. From another perspective, Nepal is seen as a gateway between Tibet and South Asia, although it is not an easy gateway.

Traditionally, China’s analysts have always looked for stable partners in Nepal and often sought to build ties with established political forces in Nepal. It is worth mentioning here that Balen canceled his planned China visit while serving as the mayor of Kathmandu. In August 2023, the Chinese government had invited him for a five-day visit to Beijing for tourism promotion and cultural exchange. But Balen canceled the visit after China released a new official map that did not reflect Nepal’s updated political map (the 2020 map including Kalapani, Lipulek and Limpiyadhura). Balen had publicly stated that, on moral grounds, he would not travel to China because of the map issue. He wrote on social media that showing Nepali territories as India’s without consulting Nepal was “against Nepali sensitivities.”

Balen’s sudden rise is, therefore, seen in China as creating uncertainty.

However, this does not necessarily mean that this uncertainty will automatically translate into aggression. In fact, it is worth noting that China has shown pragmatic and positive attitudes towards political changes in Asian countries. As long as the new leadership in Nepal is willing to cooperate economically and does not engage in activities considered hostile to China, it is likely that China will maintain positive attitudes.

Some analysts have suggested that Balen’s focus on development and infrastructure is actually in line with China’s interests. For example, there are plans to develop links between Nepal and Tibetan trade routes, and this might see new life under a new leadership committed to delivering.

Of course, it is also important to note that China will not want to be seen as being too assertive in Nepal, as this might have negative implications in Nepali politics, which is already sensitive to issues of foreign influence. Balen has managed to win popularity as a leader not beholden to traditional power centers.

Washington’s expanding footprint

Whereas India and China represent Nepal’s immediate neighbors, it is interesting to note that the United States has gradually begun to represent a third force on Nepal’s geopolitical scene.

American involvement in Nepal has largely been defined by its involvement in various development and governance projects. One of the most notable of these is the multi-million-dollar infrastructure project on electricity and road improvements through the MCC compact.

The MCC compact has been at the center of intense debate within Nepal’s political circles. While some have hailed it as a move to improve infrastructure and boost growth, others have expressed concern that it may lead to Nepal’s involvement in a wider geopolitical conflict between the US and China.

To Balen’s prospective administration, the MCC compact debate represents an interesting case of how to balance relations with the US while at the same time adhering to its policy of non-alignment.

The interest of Washington in Nepal is unlikely to diminish. This is so, especially in an era of increasing global rivalry, where even smaller countries in strategic locations are of great concern to the major world powers. The position of Nepal between India and China, in addition to the democratic system of government, makes it a favorable place for the diplomatic gestures of the USA.

Meanwhile, the intricacies of the geopolitics surrounding Nepal are further complicated by the fact that the US now wants Nepal to sign the controversial State Partnership Program (SPP) agreement, a military/security cooperation, not economic integration. Recently, a subtle hint of this American aspiration was perhaps expressed in the US Embassy statement issued on March 5, after it became clear that the RSP would register a landslide victory in the elections. The US embassy statement expressed in no uncertain terms America’s readiness to work with the incoming government in Nepal to advance “shared goals related to prosperity and security.”

However, such an agreement, especially one on security cooperation, between the US and Nepal is likely to enrage Nepal’s northern neighbor, China, which could have consequences for Nepal. Therefore, the new Balen administration may tread carefully, as signing the SPP deal could trigger backlash or hostility, if perceived as siding with the US on security cooperation.

RSP and diplomacy

The RSP, which was formed only about four years ago in 2022 has little or no practical experience in handling Nepal’s delicate diplomacy. However, by now it is expected to understand that Nepal may not have the luxury of choosing its geography, but it has the choice of choosing the extent of its intelligence in exploiting that geography. Kathmandu’s foreign policy has been held hostage by the ideological affinities of the ruling parties so far, with the UML said to be leaning toward Beijing, the Nepali Congress and Madhesh-based parties accused of bowing before Delhi, and the Maoists allegedly trying their best to balance between the two with opportunistic ease. The RSP, on the other hand, does not have any of this baggage, and that could be its greatest strength in the sphere of foreign policy.

Nepal today is at the epicenter of the emerging geopolitical rivalry between the US and China, not just in the abstract sphere of geopolitical competition, but in the very real sphere of instruments of competition landing on Nepali soil, with the MCC Compact’s USD 500 million grant on the one hand, replete with the strategic fingerprints of the US, and the BRI on the other, with its promises of connectivity still pending delivery, replete with the risks of debt-diplomacy.

Meanwhile, India looks on at both with a proprietary anxiety that it seldom bothers to hide. RSP must avoid the temptation of defining its foreign policy in terms of reaction – i.e., of those with whom it cannot afford to offend – and instead craft a proactive Non-Aligned 2.0 agenda that is based on equidistance but also assesses hard-nosed economic conditionality, i.e., Nepal deals with all partners in terms of what is delivered, what is measurable, and what is safe from the viewpoint of its own sovereignty.

This doctrine must be backed by hard leverage, not wish lists. Nepal possesses hydropower resources that can be conservatively gauged at over 40,000 MW of economically viable capacity. It is not just an energy resource but also a geopolitical bargaining chip that RSP has yet to accurately price. The terms of electric export agreements with India must be renegotiated with the same commercial acumen as India displays in its own interests. No more asymmetric terms masquerading as neighborly cooperation. On the northern front, RSP must insist on an audit of BRI pledges – specifically the connectivity corridors across the Himalayas – and link further engagement with timelines and debt transparency measures, not diplomatic communiqués.

At the same time, Kathmandu must expand its diplomatic outreach by strengthening institutional ties with the EU, Japan, and South Korea, which have the resources, technology, and no territorial interests in the Himalayas. Most importantly, RSP is expected to exhibit the discipline and vision that no Nepali party has mustered so far: drafting and enshrining a National Foreign Policy Doctrine in Parliament that commits all future governments to certain bedrock principles and takes foreign policy off the table in any future coalition calculations. Nepal’s sovereignty is non-negotiable, but sovereignty without strategy is simply waving a flag.

The tradition of balance

The diplomatic history of Nepal reveals that both RSP’s and Balen’s best possible course of action would be to follow the age-old tradition of maintaining balanced relations with multiple partners while ensuring strategic autonomy.

This has been described as “multi-vector diplomacy.” Rather than taking sides between competing geopolitical blocs, Nepal needs to work toward developing positive relations with all of them.

The road ahead may not always be smooth, particularly in view of Nepal’s economic dependence on India, the growing financial influence of China, and the development programs of the US.

Past governments have had difficulty striking the delicate balance between their relationships. Conflicts with India have occurred over issues such as border disputes and economic sanctions, while debates about Chinese economic investments have raised debt and political control issues.

Balen inherits this complicated landscape.

Yet, his brand of politics, centered around his commitment to independence and problem-solving, may actually be well-suited to the requirements of balancing diplomacy. Unlike other politicians, he comes from a tradition of politics untainted by the ideological baggage of the Cold War.

For many younger Nepalis, economic opportunity, rather than ideological loyalty to any external power, may be the first concern.

The other aspect of Balen’s rise, too, cannot be overstated. Nepal is one of the younger countries in South Asia in terms of demographics. A significant portion of its population has grown up in an environment that has been free of the monarchy and the decade-long Maoist insurgency. Politics has been experienced by this generation in terms of issues such as employment, urbanization, and migration rather than issues of revolution and ideology.

Millions of Nepali workers are employed abroad, and their remittances are a major contributor to the Nepali economy. This has had an effect on the worldview of younger voters. Balen’s background in engineering, music, and social activism is likely to find a strong resonance with this demographic of voters who are alienated from mainstream politicians.

If Balen’s government (to be formed) is successful in capitalizing on this enthusiasm, then it is possible that a significant transformation in the country’s political culture could emerge. However, it is also important to realize that Balen’s success in this regard would not only depend on his ability to reform his country’s governance structures but also on his ability to navigate the geopolitical environment in which Nepal finds itself.

The strategic tightrope

Every Nepali leader will eventually face the same question: balancing national sovereignty with relations with significantly more powerful neighbors and development partners.

India’s economic power is impossible to escape. China’s strategic influence is still growing. The US is still an important development partner and mediator.

Thus, Balen will have to walk a tightrope, and it will be made more difficult by the fact that he has a domestic constituency which hopes he can break free from the compromises and scandals of earlier governments.

But geography is not so easily changed. What is more likely is change within the boundaries of tradition.

Balen might want to diversify Nepal’s economic relationships, encourage transparent investment in infrastructure, and maintain good relations with all major powers. He will have to avoid anything which risks destabilizing regional relations or domestic consensus.

It goes without saying that as Nepal prepares for a new political era, the world is watching with curiosity. The international community perceives the rise of Balen as an unusual instance of a grassroots movement transforming the politics of Nepal. The journey of Balen, from being a rapper and engineer to becoming the mayor and now ‘the prime minister in waiting’, has become the stuff of legend for the young generation of the nation, which seeks change.

However, the real story goes beyond the individual and into the nation of Nepal.

For centuries, Nepal has tried to strike the balance between outside influences and its own culture and tradition. It has made the transition from monarchy to republic, endured a civil war, and experimented with democracy.

However, this is a nation which seems to be on the threshold of yet another change in its long and storied history. Whether Balen can harness the energy and passion which brought him to power and continue to maintain this delicate balance of the nation’s geopolitics, or whether the influences which have guided this nation’s past governments will be just as potent, only time will tell.

Either way, it is obvious that this is a region where the strategic interests of India, China, and the US are becoming more and more intertwined.

And as Balen prepares to assume leadership of his country for the first time, he must grapple with the same paradox that all of his predecessors have: the promise of change and the reality of geography.