By Napoleon S Mawphniang
A new Cold War is emerging in the Himalayas, with Nepal as a focal point between the United States’ Millennium Challenge Corporation (MCC) and China’s Belt and Road Initiative (BRI). This competition for influence mirrors historical tensions, such as Bangladesh’s anticipated 2024 upheaval and Indonesia’s 1965 conflict, which serves as a warning for South Asian states and India’s Northeast, particularly Meghalaya. Nepal’s position between China and India requires careful balancing, which is now complicated by U.S. involvement through the MCC compact, ratified in 2022 but suspended in 2025. Beijing views the MCC as a counter to the BRI, which has established a significant regional influence.
This scenario reflects Cold War 2.0, which is marked by competing development models and dependency on infrastructure. The MCC is building high-voltage transmission lines and road enhancements to foster energy sovereignty and regional market integration in the region. Meanwhile, Pokhara International Airport, financed by China Exim Bank, faces low traffic and repayment challenges, showing how infrastructure becomes a soft leverage. The airport’s financial struggles mirror other BRI assets, where revenue shortfalls convert debt into diplomatic influence, intensifying Nepal’s hedging position.
To comprehend Kathmandu’s apprehension regarding external pressures, the 2015–16 border crisis is key. An “unofficial blockade” following Nepal’s new constitution caused severe fuel and medicine shortages, which were attributed to India despite New Delhi’s denial. This blockade led to a reorientation of Nepal’s foreign policy, fostering closer ties with China and increasing scepticism towards India’s influence. This episode continues to influence Nepali perspectives on the MCC-versus-BRI discourse as a case of post-colonial power dynamics.
In August 2024, Sheikh Hasina resigned amid protests, with Washington advocating for calm and implementing visa restrictions on Bangladeshis who undermined the democratic norms. Indian media reported disruptions affecting visa centres and trade, while U.S. visas linked to Hasina were revoked after her departure. Although speculation of covert interventions emerged, what remains evident is the U.S. influence through democratic conditions, sanctions, and rhetoric in Dhaka’s political landscape.
The region recalls the events in Indonesia in 1965, when newly declassified documents and human rights reports revealed that U.S. officials had monitored the mass killings and supported military efforts to suppress the left, facilitating Suharto’s rise to authoritarian power. Archival materials, including files referenced by the U.S. State Department’s historical record, highlighting the extent of American involvement in Indonesia’s internal upheavals during that period and establishing a paradigm by which many in Asia continue to assess Washington’s strategic manoeuvres. Whether such tactics remain feasible—or even necessary—in the era of smartphones and social media, this historical memory influences how claims of “regime change” in Nepal or Bangladesh are perceived by both the public and the elites.
India’s grand strategy emerged from cautious defiance: K. Krishna Menon introduced the concept of “non-alignment,” Nehru universalized Panchsheel, and the Belgrade Summit of 1961 formalized a movement that rejected entanglement with either superpower while engaging with both. The ethical principles of mutual respect, non-interference, and peaceful coexistencehave anchored India’s diplomacy from Bandung to Belgrade and continue to influence New Delhi’s rhetoric, even as the strategic focus has shifted to connectivity, defense partnerships, and economic coalitions. The contemporary Act East Policy operationalises this shift by linking Northeast India to Myanmar, Bangladesh, and ASEAN through highways, railways, inland waterways, and ports, providing a logistical response to the ideological constraints of the Nehruvian era.
Meghalaya’s frontier economy breathes through Dawki–Tamabil, an Integrated Check Post designed to concentrate customs, immigration, cargo terminals, and warehousing into a single, modern node for legal commerce.Business reporting and official notes show Dawki as a revenue engine for exports such as limestone and coal, with periodic surges in throughput when bilateral relations and weather conditions are favourable.When Bangladesh convulsed in August 2024, border trade from Meghalaya suffered immediate disruption, costing crores in a matter of days and reminding policymakers that political shocks in Dhaka travel directly to the Jaintia Hills.
Strategists refer to the Siliguri Corridor as the “Chicken’s Neck”, a narrow land bridge measuring 20–22 km, connecting Northeast India to the rest of the country. This geographical feature renders instability in the surrounding regions of Nepal, Bhutan, or Bangladesh a matter of national security rather than a mere local issue. Recent analyses have highlighted China’s activities in the vicinity of the corridor and underscored the necessity for redundancy, such as parallel rail lines, fortified highways, and diversified access routes, to prevent a single disruption from isolating the eight states overnight. Both state and central government initiatives increasingly emphasise circumventing this vulnerability by expanding connections with Bangladesh and Myanmar.
This underscores the importance of maintaining peace and stability across these borders for the daily commerce and long-term growth of the state. The pause in the Millennium Challenge Corporation (MCC) in early 2025, following contentious ratification processes and Chinese counter-narratives, indicates that great power competition can delay development timelines while exacerbating political divisions within smaller states. The mixed outcomes of the Belt and Road Initiative (BRI), ranging from exemplary projects to debt-related challenges, introduce an additional layer of complexity, where projects like Pokhara risk becoming negotiation tools rather than drivers of prosperity. The upheaval in Bangladesh in 2024 exemplifies how governance failures can lead to external signalling, sanctions, and evacuation advisories, which, in turn, affect the cross-border connections of the Northeast, including Meghalaya.
Academic and policy literature on the Non-Aligned Movement (NAM) remains insightful: the principle of non-interference is not a sign of naïveté but a means of safeguarding autonomy, and its ethos remains pertinent in the current era of “infrastructure statecraft.” Analyses by the World Bank and Indian authorities on the Act East policy emphasise that the most effective defense of autonomy is connectivity that reduces costs, diversifies routes, and renders chokepoints irrelevant, as demonstrated by initiatives such as BBIN, the Kaladan project, and the India–Myanmar–Thailand (IMT) highway. Scholarship on the Nepal blockade offers a final caution: when supply chains are manipulated for political purposes, the resulting resentment can endure for years and drive neighbouring countries towards rival alliances.
What should Meghalaya prioritise? First, it is imperative to monitor Dawki’s operational resilience and ensure that the Integrated Check Post (ICP) evolves into a comprehensive trade platform, incorporating warehousing, digitised customs, and all-weather access. This will safeguard the state’s exporters from political fluctuations. Second, it is essential to advocate for parallel corridors through Bangladesh to reduce dependency on Siliguri, thereby aligning state investments with national priorities under the Act East policy to protect livelihoods and revenue. Third, it is crucial to track Nepal’s Millennium Challenge Corporation (MCC) and Belt and Road Initiative (BRI) developments, as grid interconnections, aviation routes, and tourism circuits in the Eastern Himalayas will eventually influence trade flows through Assam and Meghalaya.
Robert Greene posits that power operates as a theatre of perception, wherein the entity that controls the narrative ultimately influences the outcome. In the context of Nepal, the prevailing narratives are characterized by dichotomies such as “grant versus loan,” “transparency versus opacity,” and “sovereignty versus suzerainty.” The situation in Bangladesh exemplifies another principle: when legitimacy is compromised, external actors intervene, wielding the soft power of “norms” alongside the hard power of restrictions. Trade hubs, such as Dawki, often perceive these shifts before diplomatic centres.
The historical records of Indonesia in 1965 serve as a final illustration: in geopolitics, the past is never truly obsolete; it remains classified until revealed. Consequently, smaller states and border communities should incorporate redundancy, transparency, and historical awareness into their defence strategies. The emergence of a new Cold War will not manifest as military invasions but rather through the imposition of standards, sanctions, loans, and territorial demarcations, all converging on strategic choke points such as Siliguri and essential routes such as Dawki. For Meghalaya, the imperative is to adopt disciplined, non-aligned pragmatism at the state level—enhancing connectivity, safeguarding commercial sovereignty, and ensuring that infrastructure development prioritises the needs of citizens over nationalistic interests.