Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: India and China are preparing to resume border trade through the disputed Lipulekh Pass, a territory claimed by Nepal in its official map, triggering fresh geopolitical and diplomatic sensitivities in Kathmandu.
According to a report by Press Trust of India, the two neighboring powers are set to restart cross-border trade via Lipulekh after a six-year hiatus. The report, citing Uttarakhand district authorities, indicates that preparations are already underway following directives from the central government of India.
The trade route, which typically operates seasonally between June and September, connects India with China through the high-altitude Himalayan corridor. Officials say logistical arrangements are being finalized to facilitate the reopening.
The Lipulekh Pass lies in a strategically sensitive tri-junction region involving Nepal, India, and China. Although currently under Indian administrative control, Nepal has consistently asserted its sovereignty over the area, incorporating Lipulekh, Kalapani, and Limpiyadhura into its revised political map in 2020.
The renewed trade initiative is reportedly being enabled after India’s Ministry of External Affairs issued a No Objection Certificate (NOC), clearing the way for local administrations in Uttarakhand to proceed.
Indian Foreign Secretary Vikram Misri is said to have formally communicated with Uttarakhand Chief Secretary Anand Bardhan, urging coordination to operationalize the trade route.
Local references describe Lipulekh as part of the Pulang–Gunji axis, one of the key settlements in the Kalapani region. Despite India’s effective control, Nepal has repeatedly raised objections to bilateral agreements between India and China involving the area, including those signed in 2015 and 2020.
The timing of this development is politically significant within Nepal, coinciding with expectations of a potential single-party government formation led by the Rastriya Swatantra Party. Analysts suggest the move could intensify domestic political discourse and compel the incoming administration to adopt a clearer diplomatic stance on territorial sovereignty and regional trade dynamics.
Experts warn that the resumption of trade without Nepal’s consent could further complicate already delicate trilateral relations in South Asia, especially amid evolving regional power alignments and increasing strategic competition across the Himalayan frontier.
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