It's July 6 and, on a rundown bridge in Kathmandu, half a dozen police officers have set up a roadblock. Examining the occupants of each car - including the one carrying this reporter - they turn back all those in which Tibetans are riding. Ten minutes up the road, at a Tibetan settlement in the Nepalese city's southern suburb of Jawalakhel, an event to mark the Dalai Lama's 79th birthday is taking place.
Events connected with the exiled spiritual leader, like most other public activities related to neighbouring Tibet, are restricted in Nepal on orders from Beijing, say human rights organisations.
To slip past the police some families have spent the night at the settlement; others set off before dawn or squeezed themselves onto public buses, which officers are not bothering to check. In the end, several thousand Tibetans pack the field to throw barley, sing, pray and have a picnic to mark the birthday. Dozens of armed police lazily patrol the entrance, but do not disturb the event itself. The roadblock seems to have been set up simply to limit the size of the party.
In April, a Human Rights Watch report, Under China's Shadow, accused Beijing of pressuring Nepal to spy on Tibetans residing in the landlocked nation, and prevent them from staging anti-China protests. The report said surveillance cameras had been installed around the Boudhanath stupa - the main Tibetan area in Kathmandu - in 2011.
Incorporated into the People's Republic of China in 1950, Tibet has been restive ever since, and the streets of its capital, Lhasa, and the main temples in the autonomous region are similarly covered by cameras, erected by the Chinese authorities.
Nepal's increasing willingness to take such steps shows China's growing influence in the country, an influence that some see as posing a threat to India, which has traditionally held sway over its small northern neighbour. And while scholars disagree on whether Delhi or Beijing currently has the upper hand, there is certainly growing pressure on India's new prime minister, Narendra Modi, to redress the balance.
That is exactly how some interpreted Modi's visit to Kathmandu at the beginning of this month, the first by an Indian head of state in 17 years. During his visit, Modi offered Nepal US$1 billion in concessional loans to build power plants and roads, which has been seen as both an effort to make up for past neglect and a response to Kathmandu's blossoming ties with China.
Money has been China's key tool in making inroads in Nepal, too. In the financial year 2010-11, China pledged US$35.48 million in aid to Nepal, a huge jump from the US$140,000 in 2005-06, according to figures provided by Pramod Jaiswal, a doctoral fellow at India's Jawaharlal Nehru University (in 2010-11 Delhi pledged US$92.55 million). While much of this aid goes into road building and hydro-electric power plants, according to anti-war non-governmental organisation Saferworld, a sizeable portion goes to Nepal's army and police. In 2011, Beijing gave US$19 million to the Nepalese army and several million to the country's police force.
Jaiswal tells Post Magazine, "The assistance in the security sector is to serve China's own security concerns", which revolve around the 20,000 Tibetan refugees living in Nepal.
Beijing has also been trying to improve trade between the two nations. China's share of all trade with Nepal rose from 11 per cent in 2009 to 19.4 per cent in 2010, according to Saferworld.
"Chinese products are now ubiquitous throughout Nepal, and are generally regarded by Nepalis as being cheap, but of good quality, in contrast to their Indian equivalents," wrote the organisation in a 2012 report.
Nevertheless, India still dominates in trade - in 2009-10, 60 per cent of Nepal's imports came from the south, according to the World Trade Organisation.
One of the key growth areas is tourism. Thamel, Kathmandu's most well-known tourist spot, now has a stretch that could reasonably be called a Chinatown. A stroll along the main street reveals a string of Sichuan restaurants, Chinese hotels and crowds of mainland tourists of all ages. Nepali shopkeepers here speak good Putonghua. According to Nepal's Ministry of Tourism, 71,861 Chinese tourists arrived in 2012 (up from 61,917 in 2011), a group that was second in number only to those from India (165,815).
China's appetite for control of Nepal and access to markets in South Asia will be further whetted this month, when it opens a high-altitude railway from Lhasa to Shigatse, Tibet's second-largest city and the closest major town to the Nepalese border. Last month, state media reported that a long-mooted rail link from Shigatse to Gyirong, a trading post with Nepal, would be completed by 2020. Also, a road from Lhasa to Kathmandu, passing through the Nepalese district of Mustang, is being built.
Beijing has also been trying to project soft power.
"In recent years, [the] Chinese presence in Nepal has accentuated to new heights, with Chinese goods flooding Nepalese markets," says Geeta Kochhar, assistant professor at Jawaharlal Nehru University's Centre for Chinese and Southeast Asian Studies. "There is also an undercurrent fortifying the spread of Chinese language and culture in Nepal, with the boom of Confucius Institutes, China study centres and Chinese learning centres in Nepalese schools."
There are several reasons for China's recent interest in Nepal, say rights groups and scholars. A pivotal moment came with the Lhasa riots in March 2008. The Human Rights Watch report includes a translation of an interview given by a top Nepalese police officer to a Chinese newspaper in which he said, "Following the 2008 uprising in Tibet, combating 'Tibetan independence' is my main task."
As well as preventing free-Tibet activities, Beijing is concerned about Nepal's own security; the country was mired in a violent Maoist insurgency from 1996 to 2006 and peace has been shaky ever since, with the government quibbling for years over the content of the new constitution.
"The most important [issue] is security as Nepal is a southern gateway to Tibet," says Jaiswal, "[and] Tibet being a soft belly of China."
In 2005, Nepal's relations with India cooled briefly after King Gyanendra Shah seized power, but warmed again once a coalition government was elected, three years later. In that interim period, says Kochhar, China saw its chance.
"Till [a] few years back, China viewed Nepal as a state protected and hugely influenced by India, whereby exerting its prowess was not viable. But the changes in Nepal's political environment and the growing demand for its development created spaces within Nepal whereby China could make its foothold."
The need for cash, of course, has been a big incentive for Nepal in its courtship of both China and India. In 2010, the World Bank estimated 25 per cent of people in Nepal were living below the poverty line.
"With [a] poor population, abysmal infrastructure facilities and six- to eight-hour power cuts in most cities of Nepal, its expanding middle class or the multiplying business-class people have put greater demand on a better living environment," argues Kochhar.
In China's favour is the fact that many Nepalese politicians see its gifts as coming with no strings attached, whereas India is seen as a country that wants to siphon off Kathmandu's resources and meddle in its politics.
"India's overwhelming presence remains a source of resentment towards India in Nepal," Harsh V. Pant, professor in international relations at King's College London, wrote in a paper published last year. "China appears attractive because it can claim that, unlike India, it is not interested in the internal affairs of Nepal."
However, China's interest in Nepal goes far beyond just controlling Tibetans - although this, argue scholars, is still its overriding concern. Beijing is keen to rival India as a regional power in South Asia and "China believes that with small South Asian countries, it can keep India entangled in the region", preventing Delhi from becoming a threat elsewhere in Asia, says Jaiswal. "Hence, Nepal is one factor in China's long strategic game plan."
Pant wrote that China would like to "keep India confined to South Asia, despite its aspirations to emerge as a global power of some consequence".
Also, "economic motives play a central role in Beijing's foreign policy, including its increased engagement in Nepal", according to Saferworld. "Improving its economic relations with Nepal - as well as the local infrastructure - could potentially enable China to use Nepal as a transit country for trade with the whole of South Asia." The NGO also points out that as much as 75 per cent of China's "aid" to Nepal is given in the form of loans and that aid projects are awarded to Chinese contractors.
"China has generated funds for economic development in Nepal but it is also assisting the Chinese economy through the export of Chinese labour to these regions," says Pankaj K. Jha, a director of the think tank Indian Council of World Affairs.
As Kathmandu grows closer to Beijing, India is becoming concerned the situation may deteriorate into a security risk. For hundreds of years, Nepal has been a buffer state between China and India, which already have two disputed border areas - one being Aksai Chin, currently administered as part of the Xinjiang region, the other being in the Indian state of Arunachal Pradesh, a section of which is claimed by Beijing as part of Tibet.
The analysis from Saferworld concludes that: "Chinese infrastructural developments in Nepal, combined with the build-up of its military capabilities in Tibet, will enable the [People's Liberation Army] to deploy rapidly to India's borders."
Other analysts argue that Beijing and Delhi are unlikely to spar over Nepal because the governments have a common interest.
"Both China and India would like Nepal to have a constitution and political stability," says Jaiswal. "India and China have realised that only a stable Nepal can take care of their security concerns."
Nevertheless, "China seems to have an upper hand, if only because it is not part of the Nepalese domestic political narrative the way India is, which constrains its ability for diplomatic manoeuvring significantly," Pant says. "In the short to medium term, India will continue to lose the strategic space to China. China has more resources at its disposal. Also, Indian foreign bureaucracy is small and has much more crucial issues to deal with in the short term."
Jha sees things differently: "Media has exaggerated the debate but the reality is that India has always been assured of its position in Nepal. Even in difficult periods in relations, religion and people-to-people contacts have remained a binding factor."
Abanti Bhattacharya, an associate professor at the East Asian Studies department of the University of Delhi, says: "India has the upper hand still by virtue of its geographical proximity, cultural similarity and religious affinity. This is likely to remain so despite the increasing Chinese presence in Nepal.
"Given Modi's thrust on neighbourhood strategy, coupled with his avowed focus on economic development, India-Nepal relations are likely to witness a new momentum. The momentum will be particularly seen in the economic arena."
Jaiswal is also upbeat about Indian-Nepalese ties. The Nepalese monarchy, a traditional ally of China, was abolished in 2008 and, says the academic, Modi seems determined to cement ties with regional countries - his first overseas visit as prime minister was to Bhutan, in June.
"India is confident and is ready to compete. With his renewed foreign policy, chances are high that Modi will succeed in keeping Nepal away from Chinese hands."
Says Kochhar: "I believe India-Nepal have a very strong, long-standing bond. Although China is making efforts to greatly influence Nepal, its abilities are based on its own national and security interests, which the Nepalese understand quite well. I don't see as of now that China has what you would term as the 'upper hand' over Nepal but, yes, for economic reasons Nepal does see China as a potential supporter."
However the bigger picture develops, though, it may not make all that much difference to the Tibetans living in Nepal's capital.
In Boudhanath, Tibetans circle the giant white stupa under the watchful gaze of both the iconic Nepalese Buddha eyes painted on the structure and the surrounding CCTV cameras.
"It's getting worse for us here," says a Tibetan former monk in his 30s who has lived in Kathmandu for seven years and wishes to remain anonymous. "Everywhere, every time, every second, every day we are being watched. Nepal's taken a lot of money from China and so now they don't let us have protests for Tibet. And if there's any trouble, then the police beat us quite badly and throw us in jail and tear up our Dalai Lama pictures."
Hordes of tourists, many of them Chinese and seemingly oblivious to the power games playing out behind the scenes, snap pictures of the stupa and haggle in the souvenir shops that circle the monument.
"It's not going to get better for us here in Nepal," says the former monk, sadly.