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China outmanoeuvres India in game of zones
New Delhi is trying to counter growing Chinese influence throughout the region, but with limited success
COMMENTARY
WHAT:
India has just completed a new oil product pipeline to Nepal.
WHY:
India is Nepal’s only fuel supplier and the pipeline will bring down costs.
WHAT NEXT:
Nepal is one piece in a larger game that spans the South China Sea and beyond.
CHINA’S continuing efforts to expand its influ- ence throughout the Asia-Pacific region have unnerved India for many years, with New Delhi striving to counter Beijing’s influence wherever it can. But events over the last few weeks suggest that beyond its immediate backyard, India is struggling to contain China’s regional expansion.
India and Nepal’s launch this week of South Asia’s first cross-border oil pipeline has been described as a hard counter to Beijing’s interest in its South Asian neighbour. After all, the Chi- nese government had offered to supply Nepal with oil products, which have traditionally come from India alone, just as the Indo-Nepali rela- tionship reached a new low.
But while New Delhi appears to have shut the door on Beijing’s aspirations in Nepal, China has been making significant strides in expanding its presence within the South China and the Ara- bian Seas – areas that are also loaded with strate- gic importance for India.
Pipe dreams
The oil product pipeline was in inaugurated on September 10, with Indian Prime Minister
Narendra Modi and Nepal Prime Minister K P Sharma Oli joining the ceremony by video link. State-run Indian Oil Corp. (IOC) – in co-op-
eration with Nepal Oil Corp. (NOC) – built the 69-km pipeline to supply oil from Motihari in India’s Bihar State to Amlekhgunj in Nepal.
India fully funded the INR3.24bn (US$45mn), 2mn tonne per year (tpy) pipeline, which was com- pleted some 15 months ahead of schedule.
“This is a matter of satisfaction that South Asia’s first cross-border petroleum pipeline has been completed in record time. This has been completed in about half of the expected time,” Modi said.
Oli said the project was the “best example of connectivity in the field of trade and transit ... between Nepal and India.”
Nepal relies on 2.66mn tpy of Indian oil imports and 480,000 tpy of liquid petroleum gas (LPG), with this trucked in from Indian refin- eries. NOC spokesman Birendra Goit said the pipeline would save Nepal about $8.7mn per year in fuel transportation costs.
The pipeline shores up relations between the two countries, which had suffered after
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