Nepal will carry out its second joint military exercise with China in September, The Times of India reported on Monday. The daily stated that “Nepal’s military diplomacy with Beijing remains a concern for India even as the neighboring country treads carefully on its foreign policy.”

The exercise will be held in Chengdu in China’s Sichuan province and is the second event of its kind. In April last year, Nepal and China held a similar military exercise.

Nepal has had several communist-led governments since the monarchy was replaced by a federal republic in 2007. The current prime minister, Khadga Prasad Sharma Oli, is one of two chairmen of the Nepal Communist Party (NCP), which was formed in May this year through a merger of the Communist Party of Nepal (Unified Marxist-Leninists) and the Communist Party of Nepal (Maoist Center).

Oli, who became prime minister in February, comes from the CPN (UML), while the other NCP chairman is Pushpa Kamal Dahal, also known as Prachanda, who led a Maoist insurgency from 1996 to 2006 and served as prime minister from 2008-2009 and from 2016-2017.

Nepal, a traditional Indian ally, has moved closer to China in recent years but still maintains important economic, political and military relations with New Delhi. Nepal has conducted battalion-level exercises with the Indian Army for the last 13 years and Prachanda will visit India next month before he travels to China.

“Similarly, even Oli visited India before he traveled to China after taking over as prime minister this year,” The Times of India also reported, adding that “fears of any drastic shift in Nepal’s foreign policy under the united communist government are unfounded.”

But joint military exercises with China are a new phenomenon that reflects Beijing’s rapidly increasing clout in the politically volatile Himalayan nation.