Kodari Road: Implications For Nepal, China And India – Analysis


By Chok Tsering

The expansion and construction of a road network in the border areas between Nepal and China presents new opportunities for Nepal to promote the overall development of its trade. Nepal signed a boundary treaty with China in 1961 by constructing a road linking Kathmandu with the Tibetan border town of Kodari during King Mahendra’s official visit to China. Kodari lies on the Nepal-China border; China started building the Kathmandu-Kodari road in 1963 and it officially opened in 1967. This road provided a direct strategic connection between China and Nepal through the difficult terrain route of Tibet. Therefore, an open border between Nepal and China has direct implications for India as well. This article attempts to focus on the significance of this road both in terms of economic and strategic importance. It also highlights the balance of trade taking place between Nepal and China, and what Kodari means for Nepal, China and India.

Kodari road is connected by an all-weather gravel road on both sides of the border. It was only two lane road. According to a June 2011 report by Republica Business and Economy, the Nepalese government is planning to widen the Kathmandu-Kodari road from a two-lane road to a six-metalled road so that Nepal can benefit from linking with China. Other than Kodari road, there are a few other routes through which trade between the two countries is taking place. But all these are informal and not all-weather roads. One notable feature of the Nepal-China boundary is the complete absence of border check posts, except at Kodari road. For this reason, it plays a most crucial role for enhanced commerce between Nepal and China.

It has been seen in the recent times that with the deterioration of India-Nepal relations, Nepal has sought a countervailing force in China. The volume of Nepal-China trade is increasing every year but the balance of trade is in favour of China. According to Nepal’s Trade and Export Promotion Centre’s statistics, Nepal’s export to China declined by 55 per cent to NRP 360 million during the year 2010. However, Nepalese imports have increased by 0.8 per cent to NRP 26.75 billion (Kathmandu Post, 10 May 2011). Significantly, the import and export of commodities is taking place primarily through Kodari road.

Moreover, China has been increasingly involved in constructing other infrastructure projects in Nepal like Lumbini, the Pokhra-Baglung road as well as extending the railway line from Lhasa to Khasa on the Nepal-Tibet border. However, most of the labourers working on these projects are Chinese demonstrating that these projects have not created job opportunities for the Nepalese. One of China’s major aims in developing infrastructure and increasing economic ties with Nepal is to weaken India’s influence in the country, which India has enjoyed until very recently. Chinese Premier Wen Jiabao is stipulated to visit Nepal on 20-22 December 2011 which signals the strengthening of bilateral ties between China and Nepal.

Nepal has welcomed all the support given by the Chinese and is looking forward to stronger ties between the two. It is believed that with this influence China may be able to interfere in the internal matters of Nepal in the near future. Given Chinese access through Kodari road, the Indian heartland would consequently become easily accessible through the open Indo-Nepalese borders. India should therefore renew its policy with Nepal to regain lost power by developing trade links as well as start face-to-face dialogue. India should also engage with Nepal’s business companies and strategists to raise and discuss relevant Indian concern in the region.

India still is the largest investor in Nepal and accounts for two-thirds of foreign investment while only ten per cent is accounted for by China. During his recent visit to India, Nepalese Prime Minister Dr Bhattarai summed up the Indo-Nepalese relationship by saying that “Nepal and India share a very unique relationship as it is sandwiched between two huge countries of India and China. We are actually India-locked, as we have an open border on three sides.” This announcement gives India a hope that the present government is perhaps softening their attitude to India. Kodari road can also be taken as a cost effective link between the Asian giants, with Nepal playing a facilitating role for smooth trade between them.

Chok Tsering
Research Intern, IPCS
email: [email protected]


IPCS (Institute for Peace and Conflict Studies) conducts independent research on conventional and non-conventional security issues in the region and shares its findings with policy makers and the public. It provides a forum for discussion with the strategic community on strategic issues and strives to explore alternatives. Moreover, it works towards building capacity among young scholars for greater refinement of their analyses of South Asian security.

One thought on “Kodari Road: Implications For Nepal, China And India – Analysis

  • December 2, 2011 at 1:10 am

    Dear Editor,
    I extend thanks that the analyst Chok Tsering has expressed the very good analysis on Nepal China relation with the constructing roads to link Nepal- Kathmandu to another parts.

    Yes ! I am also analisizing about the future prospect of Nepal China goodness and relation.
    You know- The great leader of China, Mao Ze Dong, made his country recognized by the rest of the world fighting against imperial powers. Modifying (improving) the same policy, another leader Deng Xiaoping brought changes in Chinese communism. Even after the death of Deng Xiaoping, his Chinese policy was continued and China emerged as a global power. China, not only in the field of trade and business, was able to develop science, multilateral natural and cultural development. Adopting the path of open policy, China has stood against imperialism in the globe.

    China provided cooperation to Nepal in many sectors, such as construction of the Araniko Highway, Prithvi Highway, Ringroad, Kathmandu-Bhaktapur highway and others. Establishment of the Trolley Bus, Basbanry Tannery Industry, Harisiddhi Brick industry, Sunkoshi Hydropower Project, store houses in Kathamndu and Birgunj, Bhaktapur Brick Industry, Narayanghat-Gorkha road, Hetauda Textiles among others. Unlike India, China neither humiliated nor black-mailed Nepal. After 1990, sadly as the Nepali Congress formed the government, Girija Prasad Koirala, the then prime minister, disposed off China gifted such industries at the cheapest price. This all happened under the instruction of India. Besides, the then PM Koirala is responsible in spoiling other industries as well which contributed unemployment problem in Nepal. Because of such pro-Indian leaders in Nepal, the country is suffering.

    Still we are hopeful for the continued cooperation of China. The urgent need of the hour is to increase cooperation in trade and transport between China and Nepal. This can be facilitated by constructing a mountainous highway in Nepal from Taplejung to Darchula through Ramechhap and the upper regions of Pokhara and Kalikot. The widening network of Chinese railways can also be valuably utilized in this context as well. China should have liberal thought in order to enhance its trade and even to exhibit its existence in the region through its railways system. China should expand the railways to south Asian countries including Nepal and also to Europe. If so, China will teach a lesson to the so called imperialistic powers. And furthermore, it will give a strong message that China is friendly to the peace loving countries of the world. This great contribution of China will contribute in connecting South Asian countries, including Nepal, to Europe.

    In the name of the United Nations, America is fermenting a conspiracy to destroy China by advocating ‘Free Tibet’ and for which they are making Nepal a base area. In Nepal, with respect to the one China policy, the King had closed Dalai Lama’s office in Nepal. Being furious with Nepal, America took the path republic in Nepal. On the other hand, India with the consent of the US and the UN, helped in establishing the secular and so called federal republic of Nepal. China must not forget that the Nepalese monarch is the only guarantee for both China’s and Nepal’s security. The Nepalese monarchy had established itself as an institution fighting against imperialism. Therefore imperialistic powers have been making several conspiracies against the Nepalese monarchy.
    If a transit channel between Nepal and China exists, Nepal will largely benefit from this, for which, the railway being built in China must be used. The railway track which was built from Beijing to Lhasa has been operating since 2007. Now China must also mull over how it can benefit from the railway in terms of business expansion and identity here. China should extend its railway lines to Nepal and other South Asian nations, thus, and be able to counteract against the imperialist and colonialist nations, but at the same time establish friendly ties with peace loving nations like Nepal. The railway will also establish China as a bridge between the smaller nations of South Asia, including Nepal, and Europe. Nepal must also embark with internal and foreign support to build a highway from Taplejung to Darchula. Only then, Nepal will be able to recuperate its status as a beautiful, peaceful and great nation.
    The construction of railways can also help a country to liberate itself from foreign intervention. After the railway from Lhasa to Kathmandu via Khasa is built, a railway line from Lhasa to Kerung must also be constructed. Trailing by the bank of the Bhramhaputra River, the distance from Lhasa to Kerung is almost 1000 kilometers. The distance from Kerung to Nepal’s Rasuwa is 20/22 kilometers. Following the line from Lhasa to Kerung, the distance from Laajya of Tibet to Kimathanka of Sankhuwasabha is 100-150 kilometers. The distance to Khasa following the same line is 50-75 kilometer. The distance from Khasa to Kathmandu via Tatopani is 120/130 kilometers. If the railway line is built along the bank of Trishuli River, the distance from Kerung Rasuwagadi to Bharatpur Gaidakot via Dhading is 300 kilometers. After the railway is built in Kerung, Rasuwa, Khasa, Tatopani and to Kimantha from Lajya of China, the areas will be developed. It is imperative to form a high level railway building committee between Nepal and China with a new package for transit.
    If the railway line reaches Kerung, petroleum products can be brought from Kazakhstan and Russia, while gas can be purchased from Uzbekistan. Nepali products can be sold in the European nations and Russia.
    The most unfortunate fact is that the majority of our political leaders (Congress ( Girija and his agents) UML (Madhab Nepal, Jhalanath, Bamdev) and Maoist ( Prachanda, Baburam Bhattarai, Narayan Kaji) are all Indian’s RAW and American’CIA agents. It is worthless to expect anything from these leaders to save our Nepalese and Chinese nationality and independence.
    So, first of all, such traitors should be chaised away from the regime.It was a serious mistake by China to be the first to present letter of credential to the so-called head of the state when the King was still remained the bona fide head of state. Presenting the letter of credential by the Chinese ambassador to Prime Minister Late Girija Prasad Koirala taking him as head of the state (?) was against the international norm and practice. This ploy was actually designed by RAW, the Indian intelligence agency. Not two years have passed since monarchy was weakened in Nepal that anti-China activities have suddenly increased. This had not happened in the last 53 years. The former home minister, the traitor- Krishna Prasad Sitaoula, as Girija Prasad Koirala’s special representative, has with the consent and instruction of RAW and the CIA have been protecting the Free Tibet movement in Nepal. Some Nepalese brokers and agenda, which are close to China, are also equally responsible for the anti-China activities. The wrong advice and counsel of these agents, who do not understand ground reality of Nepal, will become an impediment in the long run to both Nepalese and Chinese governments.
    Yes ! Nepal China relations are as old as history itself, which has been further confirmed by the exchange of visits, several centuries ago, from both Nepal & China at the level of Buddhist, monks, scholars and artists. Nepal has been giving the primacy in its foreign policy to the preservation of national independence, sovereignty and territorial integrity and has consistently supported the one-China policy and has categorically started that Taiwan and Tibet are integral parts of the Chinese territory.

    So, we want China to be careful on foreign interference in China by making Nepal a base and review its policy on Nepal by following the policy it had pursued during Mao’s time who had supported the monarchial democratic system. So,frist of all there sould be reinstated the constitutional monarchy for the sake of Nepalese peace inchuding China and India too.
    Please read and reply with comments.
    Thank you.

    Dirgha Raj Prasai
    Former Member of Parliament-Nepal
    Email: [email protected]


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