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India-Nepal Relations UPSC NOTE

 


India-Nepal relations

  • India and Nepal experienced friendly and cordial bond with each other.

  • India-Nepal Treaty of Peace and Friendship, 1950

    • Bilateral treaty establishing a close strategic relationship.

    • This treaty allows free movement of people and goods between the two nations and a close relationship and collaboration between the two countries on matters of defence and foreign policy.

Trade and Economy:

  • Nepal shares a border with 5 Indian states. Hence an important point of trade and economic exchange.

  • India is the largest trading partner of Nepal.

  • India is the largest source of FDI in Nepal.

  • Indian firms engaged in manufacturing, services (banking, insurance, dry port), power sector and tourism industries etc.

Connectivity:

  • Nepal being a landlocked country, it needs freedom of transit.

Connectivity:

  • India provides transit for almost the entire third country trade of Nepal.

  • Since 2022, the Jaynagar-Bardibas railway started with India providing technical support.

  • India has also handed over the Solu Corridor, a 90-km, 132 kV power transmission line which will help bring electricity to several remote districts in northeastern Nepal.

  • Nepal has signed an MoU with India for Kathmandu-Raxaul railway link.

  • Sagarmatha to Sagar: India is looking to develop the inland waterways to Nepal and providing sea access for Nepal.

Defence cooperation:

  • Nepal acts as a buffer state against any possible aggression from China.

  • Curbing cross-border infiltrations and drug trade with help of Nepal.

  • India provides assistance to the Nepalese Army in its modernization through the provision of equipment and training.

Defence cooperation:

  • The Gorkha Regiments of the Indian Army are raised partly by recruitment from hill districts of Nepal.

  • Joint military exercise: Surya Kiran

Cultural cooperation:

  • Sister cities: India has signed three sister-city agreements for Kathmandu-Varanasi, Lumbini-Bodhgaya, and Janakpur-Ayodhya.

  • India laid the foundation for construction of the India International Centre for Buddhist Culture and Heritage in the Lumbini, Monastic Zone, Lumbini, Nepal.

Cultural cooperation:

  • The Ramayana Circuit train: It includes major pilgrimage sites from India and Nepal that are related to the Ramayana.

Energy cooperation:

  • India and Nepal share many transboundary Himalayan rivers with huge hydropower potential.

  • Hydroelectric projects: Arun III Project, Pancheshwar Multipurpose Project.

  • In 2019, the long-awaited Motihari-Amlekhgunj oil pipeline was inaugurated. 

  • India and Nepal have a Power Exchange Agreement since 1971 for meeting the power requirements in the border areas.

  • Nepal also invited Indian companies to invest in the West Seti hydropower project in Nepal.

Assistance:

  • Developmental assistance: The GoI provides development assistance to Nepal in the areas of infrastructure, health, water resources, and education and rural & community development.

  • Humanitarian assistance: due to its ecological fragility.

  • Vaccine diplomacy

Multilateral forums: 

  • BBIN (Bangladesh, Bhutan, India and Nepal), BIMSTEC, NAM, and SAARC.

What are the newly signed agreements?

  • A long-term Power Trade Agreement - set a target of importing 10,000 MW of electricity from Nepal in the coming years.

What are the newly signed agreements?

  • New pipeline will be constructed from Siliguri to Jhapa in eastern Nepal.

  • An MoU between NHPC and VUCL (Vidyut Utpadan Company Ltd.) of Nepal, for the development of Phukot Karnali Hydroelectric Project.

  • Project Development Agreement for Lower Arun Hydroelectric Project between SJVN (India) and Investment Board of Nepal.

  • Agreed to “achieve tangible and time-bound progress on the Pancheshwar multipurpose project”.

  • The two countries signed the revised Treaty of Transit under which Nepal will get to access to India’s inland waterways.

  • India facilitate export of hydropower from Nepal to Bangladesh through India.

  • Inaugurated cargo train from Bathnaha in India to Nepal Customs Yard. The rail link was built with an Indian grant.

  • Inaugurated integrated checkposts (ICPs) at Nepalgunj in Nepal and Rupaidiha on the Indian side.

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