Foreign relations of Nepal

The Federal Democratic Republic of Nepal has traditionally maintained a non-aligned policy and enjoys friendly relations with neighboring countries. As a landlocked country wedged between two larger and far stronger powers, Nepal maintains good relations with People's Republic of China. Relationship with India has observed ups and downs. Indian government's repeated attempts to deny Nepal 'Transit rights' via India and the issues of border disputes have significantly hampered the relationship between the two countries.

Constitutionally, foreign policy is to be guided by “the principles of the United Nations Charter, nonalignment, Panchsheel (five principles of peaceful coexistence), international law and the value of world peace.” In practice, foreign policy has not been directed toward projecting influence internationally but toward preserving autonomy and addressing domestic economic and security issues.

Nepal’s most substantive international relations are perhaps with international economic institutions, such as the Asian Development Bank, the International Monetary Fund, the World Bank, and the South Asian Association for Regional Cooperation, a multilateral economic development association. Nepal also has strong bilateral relations with major providers of economic and military aid, such as France, Germany, Japan, Malaysia, Switzerland, the United States, and particularly the United Kingdom, with whom military ties date to the nineteenth century. The country's external relations are primarily managed by its Ministry of Foreign Affairs. Nepal's relation with China has seen a major upswing in the recent years with China now becoming Nepal's 3rd largest aid donor (after the UK and Japan), and the largest source of FDI to Nepal.

Nepal has played an active role in the formation of the economic development-oriented South Asian Association for Regional Cooperation (SAARC) and is the site of its secretariat. On international issues, Nepal follows a nonaligned policy and often votes with the Non-Aligned Movement in the United Nations. Nepal participates in a number of UN specialized agencies and is a member of the World Bank, International Monetary Fund, Colombo Plan, and the Asian Development Bank.

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