Little too late: Done deal with China and now India ready to supply more fuel to Nepal

Nepal fuel crisis
Indian Oil’s filling station at Leh in the state of Jammu and Kashmir.

A day after Nepal snubbed India by entering a formal agreement with China National Unified Fuel Corporation, Indian Oil Corporation (IOC) announced Thursday that it was now ready to increase its supplies to the landlocked nation.

The announcement of South Asia’s largest fuel retailer comes across as absurd, if not laughable. It was but India’s acute rationing of fuel that gave Nepal no choice but seek alternative supplier. That alternative came in the form of China which was, fortunate for Nepal, forthcoming to fill in the gap created by India’s ludicrously under-supply of fuel. And now that Nepal has signed the deal with China effectively terminating India’s total control over Nepal’s fuel market, IOC’s chairman B. Ashok told an Indian media house that his organisation was ‘hopeful’ of increasing the fuel supply once the Terai unrest died down.

Indian Oil is currently providing less than a quarter of what Nepal needs on a daily basis (and what was it formally obliged to supply to Nepal but did not on the pretext of Terai movement). Even that once its refilling depots (located along Indo-Nepal border) obtain daily permissions from IOC’s headquarters. This pushed Nepal towards its southern neighbour and therefore, the eventual end to Indian Oil’s 40 year old monopoly in Nepal.

Nepal currently imports around NRS 145 billion worth of fuel from India. The loss of this market share is naturally a concern for the South Asian giant.

The import of fuel will entail greater presence of China in Nepal which explains why India is uneasy over this week’s development. However much they appear at peace on the surface, China and India are nations that have met at the battlefield before.

Immediately after Prime Minister K.P. Oli took oath of office, he dispatched his deputy Kamal Thapa to New Delhi to iron out political differences so that the supply of fuel could be ascertained. But India showed no interest in relenting the blockade which Indian media call ‘blockage due to Madeshi movement’. As a result, analysts close to southasia.com.au believe that the Nepal Communist Party (UML) camp had already begun homework to import fuel from China before the former royal turned foreign minister even returned home from India. That homework was realised last Wednesday when an eight-member Nepalese team reached Beijing to talk fuel.

Chinese petrol is expected fuel Nepalese number-platters as early as this weekend.

One thought on “Little too late: Done deal with China and now India ready to supply more fuel to Nepal

  1. It’s not the terai unrest, it’s the worst bureaucracy of Modi government! How could they decide what the people’s of Nepal wanted? Since the constitution has passed with such a great margin. Dear Modi just to let you know, Anywhere in the world when there will be a change there will be opposition! yes there are some concern over terai region but we are capable of solving ourselves, India should not have interfere with any sovereign state in South Asia but they do, that’s why they are loosing ground in South Asia. Not only in Nepal all the surrounding country has problem with india’s foreign policy. India seriously has to rethink about their foreign policy and off course since they have signed WTO they should know how to respect that too!

Add Comment