INDIA-NEPAL RELATIONS

In January 2024, during the 7^th Meeting of the India-Nepal Joint Commission held in Kathmandu.

Key outcomes from the India-Nepal Joint Commission meeting:

Both nations inked several key agreements and reviewed all aspects of bilateral relations including connectivity, infrastructure development, economic partnership, trade, transit, investment, power, water resources, culture, tourism, sports, health and education.

1. Power Export Agreement: Nepal and India signed a long-term agreement for the export of 10,000 MW of power to India for the next 10 years.
2. Cooperation in Renewable Energy: The Nepal Electricity Authority and India’s National Thermal Power Corporation Limited (NTPC) also signed an MoU for cooperation in renewable energy.
3. Inauguration of Cross-Border Transmission Lines: Inauguration of 3 cross-border transmission lines which was completed with the help of India (132 kV Raxaul-Parwanipur, 132 kV Kushaha-Kataiya and New Nautanwa-Mainahiya lines).
4. Financial Aid for Reconstruction: India will provide 10 billion rupees to Nepal for reconstruction of earthquake hit areas of Jajarkot and Rukum West.
5. Satellite Cooperation Agreement: An agreement for the launch of Nepal’s Munal satellite was formalized between the Nepal Academy of Science and Technology and NewSpace India Limited (NSIL) under the Indian Space Research Organisation.

Major Areas of Cooperation Between India and Nepal

1. About the relationship:

   1. India and Nepal share close and friendly relations characterized by age-old historical and cultural linkages, open border and deep-rooted people-to-people contacts.
   2. Nepal shares a border of over 1850 km with five Indian states – Sikkim, West Bengal, Bihar, Uttar Pradesh and Uttarakhand.
   3. The India-Nepal Treaty of Peace and Friendship of 1950 forms the bedrock of India-Nepal relations.

2. Defence and security cooperation:

   1. Since 1950, India and Nepal have been awarding honorary rank of General to each other’s Army Chief.
   2. India assists Nepal army in its modernization through training and joint military exercise (Surya Kiran).

3. Trade and economic cooperation:

   1. India is Nepal's largest trade partner and the largest source of foreign investments.

4. Connectivity and developmental cooperation:

   1. Line of credit of $680 million by India to fund three major transmission corridors in Nepal- Bheri Corridor, Nijgadh-Inaruwa Corridor and Gandak-Nepalgunj Corridor.
   2. Twin Integrated Check Posts (ICPs) in Rupaidiha in India and Nepalgunj in Nepal in 2023.
   3. Establishing cross-border rail links at Raxaul-Kathmandu, Jogbani-Biratnagar and Jaynagar-Bardibas.
   4. Revised treaty of transit that would provide Nepal access to inland waterways of India.
   5. Some of the High Impact Community Development Projects (HICDPs) include Fateh Bal Eye Hospital in Nepalgunj, Rapti Cold Storage Building in Lamahi Bazar and Rehabilitated Small Hydro Power Plant in Jumla District.

5. Energy and Hydropower cooperation:

   1. India and Nepal have had a Power Exchange Agreement since 1971 for meeting the power requirements in the border areas.
   2. Construction of Motihari-Amlekhgunj oil pipeline.
   3. India and Nepal have had long-standing and fruitful hydropower cooperation: Phukot Karnali Hydroelectric Project, West Seti and Seti River (SR6) projects (1,200 MW), Lower Arun Hydroelectric Project, etc

6. Water sharing cooperation:

   1. The Koshi Agreement and Gandak Agreement were the initial significant agreements fostering India-Nepal cooperation in the water resources sector.
   2. Another vital pact, the Mahakali Treaty, ensures the fair utilization of Mahakali River, waters for both countries.

7. Multilateral cooperation

   1. Multilateral Cooperation as part of BBIN (Bangladesh, Bhutan, India, and Nepal), BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation), and SAARC. Nepal also joined India-led International Solar Alliance (ISA).

8. Cultural Cooperation:

   1. Swadesh Darshan scheme has Buddhist and Ramayana circuits which connect the religious cities of Lumbini and Janakpur with that of India.
   2. Strong and deeply rooted people to people connect (Roti Beti ka Rishta)

Major challenges in India-Nepal relationship

Solutions

Boundary dispute: Kathmandu, in 2020, released a political map that showed 3 Indian territories - Limpiyadhura, Kalapani and Lipulekh - as part of Nepal. China’s rising footprints: Increasing China’s role in Nepal’s economy through BRI and other developmental projects and aggravated anti-India sentiment in Nepal’s political sphere. Trust Gap: Due to India’s slow pace of project implementation and the alleged perception of India’s interference in Nepal’s politics Security concerns: Porous border facilitates arms smuggling, terrorist activities and flow of counterfeit Indian currency, all of which pose serious security risks to India Treaty of Peace and Friendship, 1950: Treaty is “not in tune with time.”

Boundary dispute resolution between India and Bangladesh can serve as a model. Focus on multimodal connectivity projects like BBIN to counter China’s BRI. India also needs to maintain Sustained engagement and limited interference with Nepal across political spectrum. Faster and effective implementation of India-led projects in Nepal to bolster positive public sentiment towards India’s delivery. It is imperative to engage in cooperative discussions to enhance border transit mechanism. Integrated border control, including cutting-edge sensors, drones, and transportation and intervention tools, requires institutionalised engagement. Revisiting the Friendship treaty is a required step to take the relationship to further heights.

Conclusion

India and Nepal are increasingly realising the mutual benefits of their partnership and cooperation. They recognise the strategic importance of each other in the evolving global order and have maintained a positive momentum despite certain political challenges. It is only through sustained engagements that both nations can address the mutual suspicions and build trust for greater good of the region.

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