October Analysis: Diplomacy & Security


With growing American frustration over MCC delays, Nepal is in a diplomatic pickle. As ruling party and opposition battle over the MCC contention, the prolonged decision may cost Nepal several benefits of the Nepal-USA friendship. On the South Asia front, Taliban seeking international recognition makes the members of the region cautious regarding its future.

Timeline of Major Events

10 October  Taliban and United States representatives meet for the first time since US pullout in Afghanistan.
30 OctoberThe United States MCC expresses dissatisfaction over delay in Parliamentary ratification of the compact.

American Frustration Grows as Prorogation of House Session Delays MCC Ratification

The United States Millenium Challenge Corporation (MCC) had released a statement in September expressing that both MCC and Nepal had taken positive steps towards the ratification of the compact after MCC’s Vice President Fatema Sumar’s visit to Nepal in early September. However, after the parliament session was prorogued on 29 October, MCC released another a statement expressing dissatisfaction. The government decided to end the Parliament session after the main opposition CPN-UML obstructed house proceedings to protest the alleged bias of Speaker Agni Prasad Sapkota. This obstructed the passing of various crucial bills as well as the Parliamentary ratification of the compact which has been pushed several times before.

Fatema Sumar, Vice President of the US Agency for International Development, Millennium Challenge Corporation (MCC), paying a courtesy call on Energy, Water Resources and Irrigation Minister, Pampha Bhusal at her office in Singha Durbar. Photo: RSS

During her visit, Fatema Sumar she had met with political leaders to discuss the opportunities provided by the compact and offered clarifications on issues linked with the MCC. For instance, she dismissed doubts around MCC being a part of the Indo-Pacific strategy which would violate one of Nepal’s core foreign policy tenets of non-alignment. However, sharp divide over the compact within the coalition government has added further complications to the ratification. Those in support of the compact argue that it is vital for the development of the country as it would create infrastructure, employment opportunities, and accelerate economic development of the country. Whereas, critics perceive MCC to be against the national interest of the country and argue that it overrides the Nepali constitution putting United States in control of the implementation of the compact.

MCC headquarters released a statement on the evening of 29 October which stated that such obstructions to the ratification of the compact further delays benefits to millions of Nepali households and that delays to ratification jeopardize the critical and timely support that the grant would provide. While the statement also said that the decision to move forward with the compact or not rests with Nepal, in a display of American persistence on the ratification of the agreement, it also emphasized that the government of Nepal had made commitments confirming their ongoing support for the compact. Growing American frustration can be observed along with mounting pressure on the Nepali government.

Taliban Asks for International Recognition, Starting with The United States

Taliban has been vying for international legitimacy as its economic and humanitarian crisis deepens. The spokesperson of the group has also said that they are hopeful about their prospects. Although the withdrawal of US and NATO forces from Afghanistan was carried out in coordination with the Taliban, acknowledging in some manner the change of power in Afghanistan, The United States is yet to formally recognize the group since their takeover of the Kabul. In fact, no country has formally recognized the group. Nonetheless, the issue has been a major point of discussion as governments, including those of China, Russia, Pakistan and even the United States, maintain contact with the group now effectively in charge of the country. A Taliban also representative acknowledged the importance of American and said it is not only essential for stability in Afghanistan but also for the region and the world. Back in early September, President Joe Biden said that the US is a long way from recognizing the Taliban and that they would be judged “by their actions”. However, representatives of The United States and Taliban met in Doha Qatar on October 10 which marked the first meeting between both sides since Taliban takeover of Kabul, signaling a change in dynamics.

The major concerns associated with the Taliban’s rule are rooted in its last takeover of Afghanistan 25 years ago. The group’s treatment of women and minorities were condemned by many within the international community, as was the presence of Al-Qaeda, which used Afghanistan to launch deadly plots against other nations, most infamously the 9/11 attacks that prompted the U.S.-led invasion that dismantled the Taliban administration two decades ago. Recognition from the United States is likely to open doors for the government such as receiving funds and unfreezing currently frozen assets to address the severe economic and humanitarian crisis the country faces. Furthermore, American recognition of the group would likely mean that other countries would follow suit.

China was the first country to meet with Taliban representatives and has consequently increased engagements. However, it has also not yet recognized the group unlike anticipated. China appears disinclined to do so unilaterally while making various efforts to rally Russia and Pakistan to act on it collectively. Islamic fundamentalism is a challenge for all three countries. Therefore, policy coordination would allow China, Russia, and Pakistan to work, support, and make reforms through a common framework. Thus, the United States cannot afford indecisiveness while Russia and China proactively engage the Taliban.

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