United Nations, September 27, 2026 (Yes Punjab News)
Nepal is seeking to turn its strategic location between India and China into an economic advantage by deepening trade with India, improving connectivity with China and expanding engagement with other global partners, Foreign Minister Shisir Khanal has said.
Speaking at an Asia Society event on the sidelines of the 81st UN General Assembly in New York, Khanal said Nepal’s challenge was no longer simply how to manage its position between two major neighbours, but how to create economic value from that geography. Nepal’s Foreign Ministry has similarly described the approach as “developmental autonomy”.
“We did not see our northern and southern corridors as competing directions,” Khanal said, describing Nepal as being land-linked to two of the world’s largest markets.
India remains central to the strategy. Khanal highlighted Nepal’s open border with India and the scope for connecting Nepali production with the Indian market. He also identified hydropower as a major area of cooperation, with Nepal seeking to expand generation and export electricity to India and onward to Bangladesh.
Khanal described Nepal’s current relationship with India as “Excellent”, saying he had met External Affairs Minister S. Jaishankar in New York. The two ministers discussed strengthening bilateral ties during a meeting on the sidelines of the UN General Assembly.
He said India accounts for almost two-thirds of Nepal’s trade and remains important for access to ports, besides the two countries’ close social and cultural ties.
On China, Khanal said Nepal was pursuing improved Himalayan connectivity through roads, dry ports, aviation, digital links and eventually railways. He also highlighted cooperation on glacial monitoring, disaster early-warning systems and climate adaptation. Nepal’s Foreign Ministry has said its approach to China is focused on connectivity, economic cooperation and maintaining sovereign autonomy.
Khanal said Nepal signed a memorandum on China’s Belt and Road Initiative in 2017 and a framework agreement in December 2024, though projects under the framework have yet to begin implementation.
He said Nepal’s broader goal was “developmental autonomy” — using foreign partnerships to strengthen productive capacity and create jobs at home. The government aims to reach middle-income status within 10 years and become a developed, high-income country by 2050.
The United States also features in the strategy, with Kathmandu seeking greater American investment while remaining cautious about security alliances and cooperation.
Khanal linked the economic agenda to governance reforms, saying young Nepalis had demanded action on corruption and poor public services. He said improving state institutions was essential to attracting investment and creating greater economic opportunities at home.
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