Economic emphasis – on India-Nepal ties | 9th June 2023 | UPSC Daily Editorial Analysis

Please Share with maximum friends to support the Initiative.

What's the article about?

  • It talks about the India-Nepal ties.


  • GS2: India and its Neighborhood- Relations;
  • Prelims


  • Recently, Nepal’s PM visited India. This was the first bilateral visit abroad by the PM of Nepal after assuming office in December 2022.

Highlights of the visit:

  • Handing over of Kurtha-Bijalpura section of railway line.
  • Inaugural run of an Indian railway cargo train from Bathnaha (India) to Nepal Customs Yard which is the newly constructed rail link under Indian grant.
  • Inauguration of Integrated Checkposts (ICPs) at Nepalgunj (Nepal) and Rupaidiha (India).
  • Treaty of Transit between the Government of India and the Government of Nepal;
  • MoU between the Government of India and the Government of Nepal for cooperation in the field of Petroleum Infrastructure;
  • MoU between India and Nepal for the development of infrastructure at Dodhara Chandani check post along India-Nepal Border;
  • MoU between NPCIL & NCHL, Nepal for cross border payments;
  • Project Development Agreement of Lower Arun Hydroelectric Project;
  • MoU for the development of Phukot- Karnali Hydroelectric Project.


  • Significance of the relationship:
    • India shares an open border with Nepal that allows their nationals to move freely. Thus India and Nepal share more intimate relations. Their relationship is characterised by close economic, security and cultural ties.
    • India remains a major trade and transit partner, where a number of Nepalis continue to earn a living or pursue higher education.
    • Good ties with Nepal, meanwhile, help India address security and geopolitical issues in its neighbourhood more smoothly.
  • Disputes and its impact on relationship:
    • The political relationship, in the near past, has gone through more ebbs than flows, largely due to a border dispute over the Kalapani area.
    • A change of government in Nepal with the fall of the hawkish regime led by Khadga Prasad Sharma Oli and the restoration of the pre-2022 election Nepali Congress and Maoist alliance to power raised expectations of a thaw in this matter.
    • During a four-day India visit by Nepal Prime Minister Pushpa Kamal Dahal last week, this irritant in ties was not delved upon, and that in itself could count as a positive measure to move towards relative bonhomie.
  • Regaining the strength in relationship:
    • Economic ties received a fillip with progress in expanding cooperation in power sector development and trade.
    • The finalisation of an agreement to increase the export of power from Nepal to India to 10,000 MW within 10 years, development of new transmission lines, an MoU for the construction of a petroleum supply pipeline between Siliguri and Jhapa, besides extensions to existing pipelines and construction of new terminals were positive.
    • But the highlight of Mr. Dahal’s visit was an agreement to take forward the Indian proposal of the export of Nepal’s hydropower to Bangladesh through Indian territory.

Way Forward:

  • While the emphasis on economic ties should keep the relationship in good stead, the governments cannot just put the border issue on the back burner and expect it to be sorted out. Modalities to discuss the issue and seek a lasting solution should be a priority, going forward.

Please Share with maximum friends to support the Initiative.

Download the Samajho App

Join 5 lakh+ students in downloading PDF Notes for 2000+ Topics relevant for UPSC Civil Services Exam. &nbsp Samajho Android App: Samajho iOS App: &nbsp Samajho IAS Youtube Channel (300K+ Subscribers):