The Role of the Economic Development Interests of Bhutan and Nepal in Determining Their Foreign Policy Strategies

Abstract

The article provides a comprehensive analysis of the economic situation in two small countries of South Asia – Bhutan and Nepal. The author has studied the agricultural sector, industrial, tourist, hydroelectric industries of their national economies, the range of goods produced by Bhutan and Nepal, as well as the circle of their main trade and economic partners. The role of income from labor migration for improving the well-being of the population of both states is considered separately. The author analyzes Bhutan’s and Nepal’s indicators of socio-economic development according to the UN classification. Based on the work carried out, the author comes to the conclusion that for both countries their economic and social interests play the key role in determining their foreign policy strategy. As landlocked countries with a complex and ambiguous history, their relations with two neighbors, India and China, are their priority. Taking into account the Indo-Chinese competitive interaction, it becomes obvious that the Governments of both Bhutan and Nepal are trying to find a balance between the two rival countries and their own national interests. However, they choose different balancing scenarios. Nepal is characterized by a clearly represented course towards the sovereignization of the country and its foreign policy with the creation of positive neutrality in relations with both neighbor states. The leadership of Bhutan, from the other side, traditionally chooses a pro-Indian course with cautious steps towards resolving contradictions in relations with China.