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Moving Nowhere


Jan 20, 2016- The year 2015 marked the 50th anniversary of bilateral relationshi
p between Nepal and Canada, but no substantial efforts were observed last year t
make this alliance more rewarding and fruitful. Even though some events were pla
nned, the massive April earthquake disrupted celebrations in the first half of t
he year while political unrest and the undeclared Indian trade embargo marred th
e second half. In Canada, political campaigns for the federal election overshado
wed diplomatic formalities.
Even though the Nepali Embassy in Canada had prepared to congregate more than on
e hundred Canadian Everest summiteers to mark the golden jubilee year, owing to
the earthquake, the activity was cancelled. The embassy had also reached out to
the Nepali diaspora across Canada and collected $144, 000 for the governments dis
aster relief fund. Yet spending approximately a half-million dollars every year
to operate the Nepali Embassy in Ottawa has not resulted in any tangible outcome
even after six years of its establishment.
However, there were some modest activities to mark the golden jubilee year. For
instance, Deepak Obhrai, then parliamentary secretary to the Minister of Foreign
Affairs of Canada visited Nepal in January last year. Similarly, a Nepali deleg
ation of the National Information Commission visited Canada in June and had meet
ings with Information Commissioner of Canada. But these mediocre visits indicate
a lack of serious commitment to revive and strengthen the diplomatic engagement
between the two countries.
The relationship
In 2009, the Government of Canada decided to discontinue its bilateral assistanc
e to Nepal and closed its consulate in Kathmandu. But the very same year, Nepal
opened its embassy in Canada. Though it is unknown why Nepal decided to open its
embassy in Canada when Canada discontinued its bilateral aid to the country, th
ere are a number of reasons that motivated Canada to do so.
Nepal established its diplomatic relations with Canada in 1965. For many western
countries including Canada, Nepal was important then because China, a mysteriou
s communist country, had conquered Tibet and Nepal was the nearest point that co
uld be used to observe the political activities of mainland China. Today, howeve
r, things are different. China is the second largest economy in the world, and t
he issue of Tibet no longer holds as much significance because many western coun
tries now share a strong trade relationship with China. This can be one reason w
hy Nepals value depreciated for Canada.
Canada has been indirectly involved in Nepals development through the Colombo Pla
n since 1952. Till date, Canada has given approximately $500 million in aid to N
epal through the Canadian International Development Agency (CIDA) and other agen
cies. Canadian agencies were also interested in various sectors including energy
equipment, engineering, infrastructure development, telecommunications and air
transportation in Nepal. In 1972, Canada exported 10 Twin Otter planes to Nepal,
including five donated ones, as part of bilateral aid cooperation. Canada might
have expected trade in its areas of expertise, such as airplane purchase, maint
enance and air safety services and equipment, but Nepal favoured Japan and Europ
ean countries for such services and failed to understand Canadas trade interests.
Moreover, Nepals deteriorating political situation such as the decade-long civil
war and a prolonged post-conflict transition may have made Canada reluctant for
a productive trade relation.

Trade not aid

In todays time, diplomatic relations between nations are largely motivated by tra
de. Despite longstanding diplomatic ties, trade between Nepal and Canada is insi
gnificant. According to the Government of Canada, the maximum two-way business b
etween the countries in 2012-13 was $23 million, which was 0.002 percent of Cana
das global trade. Fortunately, Nepal had a trade surplus by exporting goods worth
$11.7 million to Canada in comparison to imports worth $7.1 million.
Canada experienced economic recessions in the early 1980s, early 1990s and again
in the early 2010s. This led to massive government deficits, high unemployment,
general disaffection, and change in governments. As a result, the Government of
Canada made severe budget cuts, overhauled its global aid distribution, and shi
fted its diplomatic priority from aid to trade. CIDA relocated funds more preci
sely to the so-called country of focus, a group of 20 nations which together recei
ve 80 percent of Canadas international aid. Nepal was one of the 14 countries tha
t experienced the withdrawal of Canadian aid by the end of 2013.
However, in the aftermath of the April earthquake, Canada provided $23 million a
s humanitarian assistance and deployed its Disaster Assistance Response Team fo
r rescue efforts. Unfortunately, a Canadian minister publicly complained in a TV
interview that Nepal did not recognise Canadas immediate aid response. Regardles
s of the sweet and sour diplomatic relationship between the two countries, Nepal
is still a popular destination for many Canadians. More than 15,000 Canadians v
isited Nepal in 2014. In a nutshell, it seems as though Canada expects trade rel
ations with Nepal but Nepal is still anticipating aid. After five decades, Nepal
and Canada are almost in the same place where they had begun their diplomatic r
elations. Nepal must understand that bilateral ties no longer work if trade is n
ot involved.
Acharya is a researcher on media ethics and accountability and is affiliated wit
h the University of Ottawa, Canada. He can be contacted at acharya.bhanubhakta@g


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