India Prepares to Start Trade with China via Lipulekh Pass: What Will Nepal’s Response Be?

India is preparing to initiate trade with China through the Lipulekh pass. So far, the Nepalese government has not issued an official position on this matter. Nepal has consistently claimed the Lipulekh, Kalapani, and Limpiyadhura areas as its territory. Former Foreign Minister Pradeep Gyawali has emphasized the need for the government to clearly articulate its stance.
Date: March 24 | Location: Kathmandu

India’s plan to conduct trade with China via Lipulekh, a territory claimed by Nepal, has yet to elicit a formal response from the Nepalese government. On March 19, the Press Trust of India reported that India’s Foreign Secretary Vikram Misri wrote a letter to Uttarakhand’s Chief Secretary A.N. Vardhan urging the reopening of trade through the Lipulekh pass. Nepal claims the eastern region of the Mahakali River, including Kalapani, Lipulekh, and Limpiyadhura, as its own territory. According to the 1816 Treaty of Sugauli between Nepal and British India, the land east of the Kali (Mahakali) River belongs to Nepal. Reportedly, India plans to reopen trade through Lipulekh starting June. Diplomatic experts suggest that Nepal should issue a responsible official statement and seek resolution through dialogue.

Former Foreign Minister Pradeep Gyawali stresses that Nepal should clearly convey its firm position to both Beijing and New Delhi regarding Lipulekh. He states, “The government must clarify its perspective and recognition. Since 2015, we have maintained that this is Nepalese territory and that no decisions should be made without Nepal’s consent.” Likewise, former ambassador Dinesh Bhattarai highlights that the government should not delay responding on such sensitive border disputes. Bhattarai asserts, “This government has remained silent on many issues. We cannot afford to remain quiet when illegal activities occur on Nepalese land.” Both Nepal’s neighbors have appeared insensitive to these concerns.

Following Indian Prime Minister Narendra Modi’s visit to China in 2015, a 41-point joint communiqué included a clause related to the use of Nepalese territory at Lipulekh. Clause 28 of the joint statement referenced an agreement between Modi and Chinese Premier Li Keqiang to make Lipulekh Pass a center for trade and pilgrimage traffic. Nepal, however, did not consent to this usage of its land and has formally protested to both neighboring countries, according to Dinesh Bhattarai, foreign affairs advisor to former Prime Minister Sushil Koirala. He notes, “Unauthorized use of our territory without consultation is unacceptable. We have sent protest notes to both countries.”