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Why India Is Growing Suspicious of Nepal’s New Government

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14.05.2026

The Pulse | Diplomacy | South Asia

Why India Is Growing Suspicious of Nepal’s New Government

India thought it had an agreement with the RSP leadership on its interests being accommodated.

India’s early optimism about relations with Nepal is quickly fading.

Following Nepal’s Gen Z uprising last year, New Delhi had firmly backed the interim government of Sushila Karki and its single-point agenda of holding timely elections. The Karki government delivered on that promise.

In the March 5 parliamentary elections, the Rashtriya Swatantra Party (RSP) secured nearly a two-thirds majority. Its projected prime ministerial candidate, Balendra Shah, took over the government’s reins on March 26.

India, which supposedly had a pre-poll understanding with the RSP that its vital interests would be protected should the party come to power, seemed happy with developments in Kathmandu. Following the publication of Nepal’s election results, Indian Prime Minister Narendra Modi could barely conceal his delight in the congratulatory message for Shah.

Yet cracks quickly emerged in India-Nepal ties. In keeping with the tradition, Indian Ambassador to Nepal Naveen Shrivastava wanted to congratulate Shah personally when he became the prime minister. But Shah, in a mood to break from the tradition of Nepali executive heads individually meeting foreign ambassadors, gave a collective audience to resident ambassadors in Kathmandu.

It later transpired that the Indian prime minister had invited Shah to visit India while extending his congratulatory message — and Shah had accepted the invitation. Kathmandu and New Delhi expedited preparations for the visit. Then, unexpectedly, the RSP issued a statement saying that the Nepali prime minister would not be making any foreign trip for at least a year.

This happened even as Indian Foreign Secretary Vikram Misri was scheduled to visit Kathmandu and extend Modi’s formal invitation to the Nepali prime minister.

Again, Shah did not agree to a meeting with Misri, in line with his stand that he would not meet any foreign leader below the rank of a minister.

Interestingly, the new prime minister went against his own Cabinet members, who advised that a blanket policy of not meeting foreign delegates was unwise. The prime minister seldom listens even to senior RSP colleagues.

Around the same time that preparations were underway for Misri’s Kathmandu visit, Nepal lodged a sharp protest with New Delhi against the new China-India deal to resume trade and pilgrimage through the Lipulekh Pass, which lies on a trijunction point between the three countries. In light of all these developments, Misri’s Kathmandu visit was postponed.

That was not all. The Shah government enforced a long-ignored directive whereby goods bought by Nepali nationals in Indian border towns would be taxed, purportedly to control smuggling. This affected the........

© The Diplomat