March was a momentous period for the Himalayan neighborhood. China finalized its 15th Five-Year Plan (2026-30) outline at the national two sessions and Nepal elected the Rastriya Swatantra Party as a rare single-majority party in the House of Representatives.

China's Five-Year Plan indicates that its "neighborhood occupies a top priority on its diplomatic agenda", while Nepal's new ruling party places a strong emphasis on "development diplomacy" with neighbors.

This synchronization, which creates a reciprocal prioritization of shared development and win-win cooperation, is a strategic opportunity for deeper economic diplomacy. The countries connected by mountains and rivers can leverage their 70-year friendship to explore mutual strategic advantages with a renewed spirit.

The last seven decades evidently prove that Sino-Nepal ties are a true materialization of the five principles of peaceful coexistence.

China's role as a "stabilizing force", based on a benevolent diplomatic approach, was reiterated by Chinese Foreign Minister Wang Yi during the two sessions when he said that "neighbors helping neighbors and building an amicable neighborhood is part of Chinese tradition and culture".

This approach is a strategic reassurance for neighbors such as Nepal, a country with a complex geopolitical landscape. Nepal's new ruling party the RSP, and newly appointed foreign affairs minister Shishir Khanal have emphasized economic and development diplomacy, and continuation of the existing foreign policy framework, including adherence to the one-China principle.

In a congratulatory note to the Nepalese foreign minister, Wang renewed China's commitment to deepening the bilateral partnership, focusing on mutual growth and prosperity.

This shared commitment is vital for Sino-Nepal relations, as it is grounded in Nepal's unwavering commitment to the one-China principle and China's acknowledgment of Nepal's sovereign equality. The continuation of this reciprocal framework of trust enables both nations to enhance cooperation in a stable and predictable manner.

In the current geopolitical climate, economic interdependence is linked to mutual security. The RSP's election commitment promises a 7 percent growth rate and a "one-stop service center" for investment in Nepal.

However, rising inflation, Nepal's reliance on imports, and the vulnerability of migrant remittances — particularly from the Gulf region because of the Middle East conflict — continue to pose risks.

The appointment of Swarnim Wagle, a technocrat with experience in international development, as finance minister in Nepal, offers hope.

Wagle's technocratic experience aligns with the objectives of China's 15th Five-Year Plan, which are essential for Nepal's transition from least developed country status.

China's focus on expanding R&D and innovation over the next five years complements Nepal's ambition to rise above the least developed countries. This paves the way for knowledge and technology transfer as well as enhanced cooperation.

For Nepal, development diplomacy will require not only financial inflows but also access to expertise and institutional capacity. Enhanced economic diplomacy is therefore not optional but necessary to materialize this potential.

For China, Nepal offers several advantages. Unique geographical location of Nepal makes it a gateway to South Asia, allowing it to serve as a bridge connecting major fast-growing regional markets.

Nepal also presents opportunities for trade, energy investments and for harnessing its extensive river systems for hydroelectric power generation.

Additionally, Nepal's young, tech-savvy population makes it an appealing base for IT and outsourcing industries.

Tourism remains an immediate opportunity for growth, with huge potential in hospitality infrastructure to attract not only more Chinese visitors but also investors.

Similarly, investments in organic and high-altitude agricultural products, especially in branding and packaging of products such as tea and other herbal products, align with China's policy for quality imports.

Climate-related solutions and innovations, such as electric vehicle manufacturing and green technologies in which China is a global leader, are other areas for cooperation.

Balen Shah, the young prime minister of Nepal, has placed a strong emphasis on self-reliance in agriculture.

Given its similar topography, scattered landholdings, and reliance on small-scale family farming, Nepal can benefit from China's experiences in reforming smallholder agriculture.

Nepal could benefit from China's support in improving marketing services, pooling machinery and input procurement, and connecting small farmers to larger agribusiness value chains.

China's recent shift from mega infrastructure to "small and smart" community-focused development projects under the Belt and Road Initiative is particularly relevant for Nepal. For instance, due to challenges in transportation and storage, dairy farmers in Nepal are often forced to discard surplus milk onto roadways.

China's successful transformation of its dairy business, especially the establishment of bulk milk collection centers and cooling tanks, can offer valuable lessons.

Similarly, Nepal can set up centers for renting out machinery and work with modern agricultural machinery such as rice transplanters and mini-tillers to improve productivity.

The slow progress in infrastructure development is another area where Nepal can seek assistance from China.

Collaboration with Chinese firms equipped with modern building techniques and technologies, such as prefabrication and large-scale modular construction, can help tackle infrastructure delays.

In addition, gearing up projects under the BRI could transform Nepal's connectivity and economic status and turn the country into a true "land-linked" and "vibrant bridge" as promised by the RSP.

Leaders of both nations must capitalize on this moment, turning their historical ties into pragmatic benefits.

By combining China's economic capabilities with Nepal's strategic location and renewed political will, both nations can protect themselves from external shocks.

This partnership, built on the principles of amity, sincerity, and mutual benefit, will not only serve the interests of both peoples but also stand as a resilient example for the Global South.

The timing is ideal; the need is pressing, so neighbors must trust and help one another.

The author is a former Nepali editor and a researcher at the Center for Nepal Studies at East China University of Technology.

The views don't necessarily represent those of China Daily.

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