China-Nepal relations have political and strategic implications for India. In May 2016 when Nepal’s the then K. P. Sharma Oli government was on the verge of collapse on account of Maoist Prachanda’s threat of withdrawal of support to the government it was the Chinese ‘intervention’ that saved the day for Oli. Nepal is a challenge for the Modi government not only for the China factor but also for how to deal with its ethnic question—the controversy between the Nepali and Madhesi. The nature of the Indian state which is essentially bourgeois can never be at ease with a Communist regime next door. It would have been so even if Congress had been in power. International relations is a cutthroat field. Power speaks through overall strength, not mere good intentions. The Chinese population stood at 1.35 billion, India’s at 1.21 billion a decade ago.