India, Nepal work to revamp ties

Contact Counsellor

India, Nepal work to revamp ties

  • At the summit meeting between the Prime Ministers of India and Nepal, various bilateral issues were discussed, including management of border dispute, connectivity, power sector cooperation and India's developmental projects in Nepal.
  • The summit saw India and Nepal signing agreements to boost connectivity and energy cooperation and also inaugurating several other projects, including introduction of Rupay card in Nepal for financial connectivity.

India-Nepal Joint Vision Statement on Power Sector Cooperation

  • The Indian PM called for taking full advantage of opportunities in the power sector, including through joint development of power generation projects in Nepal and development of cross-border transmission infrastructure.
    • India plays an important role in developing Nepal's power sector, through capacity building and direct support to infrastructure projects related to generation and transmission.
  • Nepal also appreciated India's recent cross-border electricity trade regulations that have enabled it to access India's market and trade power with India.
    • Nepal exports its surplus power to India.
  • The two sides agreed to expedite work on the delayed Pancheshwar multipurpose dam project that was described by Modi as a gamechanger for the development of the region. The two sides also agreed for more participation by Indian companies in Nepal’s hydropower development plans.
    • Nepal is monetizing its huge hydropower potential by selling surplus power to India.


  • The two leaders flagged off cross-border passenger train services between Jayanagar (Bihar) in India and Kurtha in Nepal through videoconferencing. The railway line will be further extended into Nepal in the coming times.
    • Till now, people could take train up to Jayanagar in Bihar, but had to travel to Nepal by road after that.
  • With this, India and Nepal now have road, air and rail connectivity.
  • They agreed to give priority to trade and cross-border connectivity initiatives in all respects.

RuPay launched in Nepal

  • Modi and Deuba also launched the operation of RuPay cards in Nepal, intended to help promote the flow of Indian tourists to Nepal, and improve financial connectivity between the two nations.

Prevention of misuse of open borders

  • PM Modi noted that the basis of India-Nepal partnership was the mutual relations between our people and the exchanges between them.
  • However, he said that the open borders between India and Nepal should not be allowed to be “misused by unwanted elements.”
  • In this context, PM Modi also stressed on maintaining close cooperation between our defence and security institutions.

India's developmental projects in Nepal

  • India is also involved in various developmental projects in Nepal, including National Police Academy at Kavrepalanchowk, the Integrated Check Posts at Nepalgunj and Bhairahawa and the projects under the ‘Ramayana Circuit’.
  • The Indian PM thanked Nepal PM for the full support in resolving bottlenecks and facilitating the time-bound completion of such India-assisted projects.

Border dispute

  • Although the border issue was discussed briefly, no progress was made on the matter.
  • India did not delve deeply on the border dispute even as Nepal PM called to resolve the dispute through established bilateral mechanisms.
    • India had earlier rejected Nepal's unilateral move in 2020 to amend its constitution to show the Kalapani region as part of Nepal for the first time.
  • The Indian Foreign Secretary said that there was a general understanding that the dispute needs to be addressed in a responsible manner through dialogue. India said that there should be no effort to politicize the border issue, and the Nepal PM agreed to it.

Exam Track

Prelims Take Away

  • India-Nepal Projects
  • India-Nepal Borders
  • Facilities to Nepali citizens in India