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Overview of Nepal PM Pushpa Kamal Dahal visit to India; 7 MoUs Signed

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Nepal Prime Minister Prachanda to visit India from May 31 to June 3The Prime Minister (PM) of Nepal, Pushpa Kamal Dahal alias Prachanda, was on a 4-day official visit to India from May 31 – June 3, 2023, at the invitation of the PM of India Narendra Modi for regular high-level exchanges between both nations in furtherance of India’s Neighbourhood First policy.

  • The Nepal PM was accompanied by his daughter Ms Ganga Dahal; and included a delegation comprising Ministers, Secretaries, and senior officials of the Government of Nepal.
  • This was his 1st official trip abroad since assuming office in December 2022 and his 4th visit to India as the Prime Minister(PM) of Nepal.

The PMs meet:

The Nepal PM held bilateral delegation-level talks with the Indian PM at Hyderabad House in New Delhi, Delhi. They reviewed the wide-ranging areas of bilateral relations and cooperation, including trade and transit; hydropower, power trade and transmission lines; cross-border railways, motorable bridges, petroleum pipelines and ICPs; irrigation, river training, inundation and flood control; agriculture; culture and civil aviation.

India and Nepal sign seven agreements in various fields

During the meet, India and Nepal witnessed the exchange of the seven documents in various fields including trade and commerce, cross – border petroleum pipeline, development of Integrated Check Posts (ICPs) and hydroelectric project. These include the following:

i.Renewal of India-Nepal Transit of Treaty, 1992

  • Through this, a provision has been made for the people of Nepal to use the inland waterway facility of India, for the first time, along with new rail routes.
  • The India-Nepal Treaty of Transit (1992), renewed every 7 years, provides for port facilities to Nepal at Kolkata/Haldia and Visakhapatnam and specifies different transit routes between Kolkata and Vishakhapatnam and the India-Nepal border.

ii.MOU for the development of ICP at Dodhara-Chandani

iii.MOU on Cooperation in the Field of Petroleum Infrastructure.

iv.MOU between the Institute of Foreign Affairs (IFA) of Nepal and Sushma  Swaraj Institute of Foreign Service (SSIFS) of India

v.MOU for the Development of Phukot-Karnali 480 MW (Mega Watt) Hydro-electricity Project

vi.Project Development Agreement (PDA) of Lower Arun 669 MW (Mega Watt) Hydro- electricity Project

vii.MoU between National Clearing House Limited Nepal (NCHL) and National Payment Company India Limited (NPCIL) for faster cross-border payments that will benefit businesses, students and tourists of both Nepal and India.

10-year Power Trade Deal between India and Nepal:

Both sides had reached an agreement on long-term power trade, under which India will import 10,000 MW from Nepal in the next 10 years. This is a major development in enhancing cooperation in this area based on the Joint Vision Statement that the two PM issued in April 2022.

1st Trilateral Power Transaction:

Under a trilateral agreement, India agreed to allow Nepal to sell power to Bangladesh using the Indian transmission network. Both India and Nepal have agreed to export up to 50 MW of power from Nepal to Bangladesh via India.
The three countries will work out an agreement to this effect soon

  • Currently, India exports around 452 MW of power from Nepal.

Other Discussion/Agreements:

i.They agreed for the extension of the Motihari-Amlekhgunj petroleum pipeline to Chitwan as well as construction of a new pipeline along with storage terminals between Siliguri and Jhapa in eastern Nepal on grant assistance from India.

  • Indian side also agreed to construct two motorable bridges over the Mahakali River in Sirsa (Parsuram Dham Purna GiriMai) and Jhulaghat under grant assistance.

ii.With regard to the Pancheshwar Multipurpose Project (PMP) as envisaged in the Mahakali Treaty, it was agreed that the concerned officials of both governments should expedite the bilateral discussions towards early finalization of the Detailed Project Report (DPR) of the PMP within a period of 3 months.

  • PMP is a bi-national hydropower project to be developed in Mahakali River bordering Nepal and India.

What is Mahakali Treaty?

It was signed between India and Nepal in 1996 concerning Integrated Development of the Mahakali River (known as river ‘Sarda’ in India), including Sarda Barrage, Tanakpur Barrage and Pancheshwar Project.

  • Under this equal sizes of underground power house i.e. of 3240MV will be constructed on each side of Mahakali river in India and Nepal.

iii.Both sides welcomed the construction of the Tanakpur link canal and agreed that water will be released from Tanakpur barrage to irrigation command area of Nepal through this canal in a phase-wise manner.

iv.Both sides directed for early convening of the Commerce Secretary level mechanism to address the issues related to trade.

v.They agreed on the early finalization of MoU on mutual recognition of certificates and accrediting of the testing labs.

vi.They agreed to promote cooperation in the field of agriculture, including research and development, capacity building, natural farming and use of nano-fertilizers.

vii.They agreed to set up a fertilizer plant in Nepal with the participation of public and private sector entities from Nepal and India to meet the fertilizer needs of both Nepali and Indian farmers.

viii.Both sides agreed to increase physical connectivity by establishing new rail links, and to provide training to Nepalese railway personnel in Indian Railway Institutes.

Requests Made by Nepal to India:

i.Additional air entry routes for bilateral flights and requested for approval of high-altitude additional air-entry route from Mahendranagar.

ii.Operationalizing the Instrumental Landing System (ILS) procedure for smooth operation of Gautam Buddha International Airport and enhancing flight safety and efficiency.

iii.Approval of additional 1200 megawatts of hydropower for export from Nepal to India including the 456 MW Upper Tamakoshi Hydropower project at the earliest.

iv.Non-reciprocal access for Nepal’s agricultural and primary products to the Indian market.

v.Lifting of Countervailing duty on Nepali Jute Products

vi.Expedite the work of GP Koirala Institute of Health Sciences, establishment of Nepal Institute of Technology in Sudurpaschim of Nepal, and construction of Cricket Stadium and Sports Village in Fapla, Dhangadi under the grant assistance of India.

vii.Germ plasm of major cash crops particularly sugarcane and coffee.

viii.Resolve the boundary matters through the established bilateral diplomatic mechanisms.

  • In November 2019, a border disputed flared up between India and Nepal over the Kalapani territory, located in Uttarakhand’s Pithoragarh district.


The two PMs remotely inaugurated and performed the groundbreaking of following six projects:

i.Handing-taking over of Kurtha-Bijalpura section of railway line with a length of 17km, for passenger trains

ii.Flagging off the inaugural-run of Indian cargo train to Nepal on the newly built

Bathnaha-Biratnagar, Nepal Customs Yard railway, with an Indian grant

  • The new rail links will cut transportation costs and time for trade between Nepal and Kolkata and Haldia ports.

iii.Groundbreaking of ICPs at Bhairahawa (Nepal) –Sunauli (India)

iv.Inauguration of ICP at Nepalgunj (Nepal)-Rupaidiha (India)

  • It is Uttar Pradesh’s first land port or ICP, at Rupaidiha in Bahraich district along the India-Nepal border which is built on 115 acres of land, and has cost about Rs 200 crores.

Note: Land Port Authority of India (LPAI), which comes under the Union Ministry of Home Affairs (MHA), set up ICPs on India’s international borders for smooth movement of cargo and passenger vehicles.

v.Groundbreaking of phase II of the Motihari-Amlekhgunj petroleum pipeline project to be built at a cost of Rs 183 crore. This is South Asia’s first trans-border petroleum pipeline, launched in 2019, and has supplied 2.8 million metric tonnes of diesel to Nepal.

vi.Groundbreaking of 400kV Butwal-Gorakhpur Transmission Line to be built at a cost of Rs 462 crore. This is expected to be commissioned in 24 months.

Nepal-India Business Summit:

The Nepal PM also addressed the Nepal-India Business Summit in New Delhi jointly organized by Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and Confederation of Indian Industry (CII) and interact with business leaders of both countries.

  • He also interacted with the Nepali community in India over a welcome reception being hosted by the Ambassador of Nepal to India, Shankar Prasad Sharma.

The Nepalese PM also called on Indian President Droupadi Murmu and Vice-President Jagdeep Dhankhar; and visited Rajghat and paid his tribute to Mahatma Gandhi.

Key Notes:

i.PM Narebdra Modi had given the HIT formula for India-Nepal relations which stands for Highways, I-ways and Transways during his first visit to Nepal in 2014.

ii.India is also developing the mega 900 MW Arun-III hydroelectric project in Nepal, and has a 490 MW Arun-4 hydro electric project in the pipeline as well.

About Nepal:

Capital– Kathmandu
Currency– Nepalese Rupee
President– Ram Chandra Poudel