INDIA -NEPAL BILATERAL BRIEF

OVERVIEW:

     Nepal shares border with 5 Indian states of Sikkim, West Bengal, Bihar, Uttar Pradesh and Uttarakhand. India-Nepal relations are defined by the deep rooted people to people links, commonality in religion, language and culture of both countries.

HIGH LEVEL EXCHANGES:

     These bonds of friendship has defined the regular exchanges at high level between India and Nepal, which has increased in frequency in recent years, strengthening the relations further. Since May 2014, there has been 16 exchanges at the level of Head of State/ head of Government. As a part of our “Neighbourhood First” policy, Prime Minister, Shri Narendra Modi had visited Nepal five (05) times since May 2014 and Prime Ministers of Nepal have visited India nine (09) times since May 2014. The last visit by Prime Minister Modi to Nepal was his visit to Lumbini on 16 May 2022, on the holy occasion of Buddha Purnima.  The most recent visit of Prime Minister of Nepal to India was by Former PM Mr. Pushpa Kamal Dahal ‘Prachanda’ from 31 May – 3 June2023 ,   when he visited New Delhi and Madhya Pradesh on an official visit. Subsequently, both the Prime Ministers also held a telephone conversation on 5 August 2023 that followed up on decisions taken during the Prime Ministerial visit in May/June 2023. As for visit by Head of State, Hon’ble Former Rashrapati Shri Pranab Mukherjee paid a State Visit to Nepal in November 2016. This was the first State visit by an Indian President to Nepal after a gap of 18 years. In turn, Former President of Nepal Hon’ble Bidya Devi Bhandari paid a State Visit to India in April 2017.

      At Ministerial level, the Joint Commission, co-chaired by EAM, has met 5 times since May 2014, most recently in Jan 2024 in Kathmandu. The Foreign Ministers of both countries also meet frequently on the side-lines of various forums, with EAM Dr. S. Jaishankar meeting Former FM, Mr. NP Saud in Dhaka on 12 May 2023 and 17 July 2023 in Bangkok on the side-lines of the Indian Ocean Conference and the BIMSTEC Foreign Ministers meeting respectively. Recently the Foreign Ministers of both the countries met on 23 Feb 2024 on the sidelines of Raisina Dialogue 2024.

      These frequent visits and exchanges have added momentum to the bilateral partnerships, and have also helped the leadership to review at regular intervals the entire gamut of the partnership. Some of the major outcomes of the recent Prime Ministerial visit includes several landmarks in connectivity initiatives such as progress in the Integrated Check Posts at Nepalgunj, Bhairahawa and Dodhra-Chandni, inauguration of a freight train service between India and Nepal, and progress on Kurtha – Bijalpura and Raxual Kathmandu railway line, momentum on the Motihari-Amelekhgunj pipeline phase II and construction of new petroleum pipelines from Siliguri to Jhapa and Amelekhgunj to Chitwan. The visit also saw major landmarks in the power sector, including the finalization of the agreement for long term power trade, agreements on new hydropower projects developed with Indian developers like the 480 MW Phukot Karnali, 669 MW Lower Arun and a positive momentum on the trilateral power transaction between Nepal and Bangladesh through India. 

DEFENCE COOPERATION:

      India and Nepal have long standing and extensive mutually beneficial cooperation in the field of defence and security. Indian and Nepal Army has been working together on the modernization drive of the Nepali Army providing capacity building, equipment , Joint military exercises etc. 

      Historically, both armies have shared excellent and harmonious relationship based on mutual trust and respect. India and Nepal also have the longstanding tradition of awarding  honorary rank of General to each others’ Army Chief. Nepali COAS Mr. Prabhu Ram Sharma visited India from 9-12 November 2021 for the investiture ceremony and also had meeting with CDS, COAS, EAM, NSA and Raksha Mantri and India’s COAS General Manoj Pande visited Nepal from 4-8 September 2022 for his investiture ceremony. In February 2023, the Defence Minister of Nepal, Mr. Hari Prasad  Upreti visited India for the Aero India Show. 

      Also, the strong relations between the both armies are exemplified through the Gorkha Regiment. Currently around 32,000 Gorkha soldiers from Nepal are serving in the Indian Army. In addition to the Military Pension Branch in Kathmandu, Pension Paying Offices also function from Dharan and Pokhara , besides the District Soldier Boards, which assists in disbursal of pensions and in organizing various welfare programme including re-training, re-habilitating and assisting ex-Gurkha soldiers and their families.

CONNECTIVITY AND DEVELOPMENT PARTNERSHIP:

      India is the largest developmental partner of Nepal, with the major portion of developmental assistance focussed on large scale infrastructure projects under grants, in the priority sectors necessary for the rapid development of Nepal, in the field of health, education and connectivity.  India has a long history of  development cooperation with Nepal commencing from 1950s onwards. Some of the major projects undertaken and completed with the Government of India grant assistance includes, Gauchar Airport (presently Tribhuvan Airport), East West Highway, Nepal Bharat Maitri Emergency & Trauma Centre (INR 100 Cr), the first trauma centre with AIIMS like specialization, Tri Chand college development projects in Tribhuvan University, BP Koirala Institute of Health Science, Dharan, Construction of 5 storeyed OPD complex of Bir hospital etc.
 
      This developmental partnership has taken a major leap in the last 15 years, and several connectivity projects have been taken up. This includes, Jayanagar- Bijalpura-Bardibas Rail link  which is Nepal’s first ever broad gauge line, Jogbani -Biratnagar rail link , Raxaul – Kathmandu Rail link, Hulaki / Terai Road , Integrated Check Posts at Birgunj  (Nepal’s first ever Integrated Check Post) , Biratnagar , Nepalgunj  and Bhairahawa. The first cross border broad gauge passenger train service between Jayanagar in Nepal and Kurtha in India was flagged off during the visit of former PM Sher Bahadur Deuba to India from 1-3 April 2022 and the first freight train service between India and Nepal was flagged off during the visit of Prime Minister Pushpa Kamal Dahal ‘Prachanda’ from 31 May-3 June 2023. 

      To boost connectivity in the far-western region of Nepal, the construction of a motorable bridge in Dhachula began in October 2022 under grant assistance

      To ensure continuous supply of fuel from India to Nepal, the first cross border petroleum pipeline in South Asia connecting Motihari in India to Amlekhgunj in Nepal was completed  in 2019. Within a short span of the pipeline being made operational, it was able to save Nepal  nearly Rs 9 crores a month. The pipeline created a record by supplying 100 million litres of diesel to Nepal in a single month in December 2020. 

      The Government of India has also been working through the Government of Nepal at the grass root level through the implementation of High Impact Community Development Projects (HICDP) in priority sectors such as hospitals, schools, colleges, drinking water facilities, sanitation, drainage, rural electrification, hydropower, embankment and river training works, so as to improve the overall quality of life at the local level. Since 2003, 550 projects have been undertaken.

      Also, since 1994, on the occasion of Independence Day and Republic Day, the Government of India has distributed 974 ambulances and 234 school buses to various institutions in Nepal as on date.

      Apart from grant assistance, Government of India has extended Lines of Credit of USD 1.65 billion for undertaking development of infrastructure, including post-earthquake reconstruction projects. GoI LOCs have financed several projects in Nepal, mostly roads, transmission lines and reconstruction projects. Many of these projects are either complete or nearing completion. 

POWER SECTOR COOPERATION:

      One of the most important areas of mutually beneficial cooperation in the India-Nepal bilateral relations is the collaboration in the power sector. The Joint Vision Statement on Power Sector Cooperation issued on 2 April 2022 during visit of Prime Minister of Nepal to India, laid out a comprehensive roadmap for bilateral cooperation in the sector. Its key pillars include joint development of power generation projects in Nepal, development of cross-border transmission infrastructure, bi-directional power trade, coordinated operation of the national grids and institutional cooperation in sharing latest operational information technology and know-how. 

EMERGENCY/ COVID ASSISTANCE:

      India has been a longstanding partner of Nepal during emergencies and crisis situation. Nepali nationals in conflict zones, have been evacuated along with Indian nationals under Government of India’s evacuation efforts under ‘Operation Ajay’, ‘Operation Ganga’ etc. 

      India was also the first responder  when a devastating 7.8 magnitude earthquake struck Nepal on 25 April 2015 (followed by a powerful aftershock of 7.4 magnitude on 12 May 2015). The Government of India swiftly dispatched National Disaster Response Force (NDRF) teams and special aircrafts with rescue and relief materials to Nepal. India’s assistance, which reached Nepal within six hours of the earthquake, included 16 NDRF teams, 39 IAF aircraft sorties with 571 tons of relief material including rescue equipment, medical supplies, food, water, tents, blankets and tarpaulin. 

      The Government of India announced a post-earthquake reconstruction package of US$ 1 billion (which comprises US$ 250 million grant and US$ 750 million concessional Line of Credit) during the International Conference on Nepal’s Reconstruction held in Kathmandu on 25 June 2015.  The reconstruction of 50000 houses have been completed in November 2021, 71 education sector projects  and 50 health facilities have been handed over to Government of Nepal so far and the other projects and these projects are in various stages of completion.

      Similarly, when the Covid-19 Pandemic hit the world, the Government of India worked overtime to ensure that the supply lines of trade between India and Nepal remained open. Nepal was one of the first countries to receive the Made in India- COVID-19 vaccine on 21 January 2021, paving way for Nepal’s nation wide vaccination drive. India had also supplied critical supplies of medicines (23 tonnes) at the early stage of the pandemic and also during the critical shortage of oxygen faced world wide during the second wave, the Government of India despatched 960 LPM Oxygen Plant for operation at the BP Koirala Institute of Health Sciences in Dharan. 1 lakh doses of COVID-19 vaccines and medical equipment including ventilators, ambulances, ICU beds, PPE kits, PCR test kits were also handed over to the Nepali Army.

ECONOMIC AND COMMERCIAL COOPERATION:

      Indian firms are among the largest investors in Nepal, accounting for 33.5% of the total FDI stock in Nepal, worth nearly USD 670 million as on mid July 2022. Nepal is India’s 18th largest export destination, up from 28th position in 2014. India comprises about 64.1% of total trade of Nepal, equating to $8.85 billion USD (Indian FY 22-23)). This includes $8.015 billion USD of exports from India to Nepal and $839.62 million USD of exports from Nepal to India. India is Nepal’s largest export destination, receiving an overwhelming 67.9% of its total exports (as per annual data available from Nepal Rastra Bank (mid-August 2022-mid July, 2023). Nepal’s exports mainly constitute edible oil, coffee, tea and jute. Nepal’s main imports from India are petroleum products, Iron & Steel, Cereals, Vehicles and Parts, Machinery parts.There are about 150 Indian ventures operating in Nepal engaged in manufacturing, services (banking, insurance, dry port, education and telecom), power sector and tourism industries. 
 

EDUCATION:

      India’s development partnership with Nepal also extends to the field of human resource cooperation. The Government of India provides more than 1500 scholarships each year, covering for study in India as well as Nepal and encompassing courses ranging from medicine, engineering, agriculture, business, nursing, Ayurveda & other traditional medicine, music, dance etc. For Government officials and other professionals, Nepal has also been an important partner under  the Indian Technical & Economic Cooperation (ITEC) program started in 1964. Since 2007 alone, more than 2300 professionals, bureaucrats and defence personnel from Nepal have undergone this capacity building programme. In the last two years alone, around 350 doctors, judicial professionals, Office of Attorney General, Nepal Police have been beneficiaries of this ITEC program. 

CULTURE:

      India and Nepal share an organic cultural link, that is enhanced by people to people bonds.  Government of India initiatives to promote people-to-people contacts in the fields of art & culture, academics and media include cultural programmes, symposia and events organized in partnership with different local bodies of Nepal, as well as conferences and seminars in Hindi, Sanskrit.   The 75 years of India’s Independence was celebrated in Nepal in 2022 as “Azadi Ka Amrit Mahotsav” through a series of events covering music, dance, development partnership conclave and start up event. The Swami Vivekananda Cultural Centre was set up in Kathmandu in August 2007 to showcase the best of Indian culture. The Nepal-Bharat Library was founded in 1951 in Kathmandu as the first foreign library in Nepal with the objective to enhance and strengthen cultural relations and information exchange between India and Nepal. The B.P. Koirala India-Nepal Foundation was set up in 1991 with the objective to foster educational, cultural, scientific and technical cooperation between India and Nepal and to promote mutual understanding and cooperation through sharing of knowledge and professional talents in academic pursuits and technical specialization, and has been facilitating cultural connect between India and Nepal. 

DIPLOMATIC MISSIONS:

Government of India has its Embassy in Kathmandu and a Consulate General in Birgunj (south-central part of Nepal). 

Government of Nepal has its Embassy in New Delhi and a Consulate General in Kolkata.

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