Dahal, Modi discuss bilateral ties—and China

Nepal and India have agreed to put economic and development partnership at the center of their bilateral engagement, apparently downplaying the key contentious issues such as border dispute, 1950 Peace and Friendship Treaty and EPG report. Prime Minister Pushpa Kamal Dahal who is on four-day official visit to India, held bilateral talks with his Indian counterpart Narendra Modi. During the talks, the two sides signed seven agreements and made understanding on several issues, including trilateral power cooperation between Nepal, India and Bangladesh. If the agreements are implemented on time, they will substantially boost economic and development partnership between the two countries. According to officials, the discussions between two sides was focused on enhancing development partnership mainly in the areas of connectivity and infrastructure development.

Speaking at a press conference after talks between Modi and Dahal, Indian Foreign Secretary Vinay Mohan Kwatra said during the restrictive and delegation-level talks there was no mention of border dispute, EPG report, 1950 treaty and on Agnipath.

However, both Dahal and Modi briefly touched upon the boundary issues without any further elaboration during their joint address. We will resolve all the issues, be it boundary related or any other issues, Modi said. Dahal also said that issues related to boundaries would be resolved through established mechanisms. The two countries have signed several agreements in the power cooperation sector (see full report page 5), a prominent agenda of bilateral talks. PM Dahal and Modi also discussed Nepal's relationship with China and Nepal’s reported preparations to buy military hardware from China. The two leaders briefed each other about their country’s relationship with China. Asked about the China issue, Indian Foreign Secretary Kwatra, in the press conference, said: "When it comes to the vital developments in the region (read China), naturally two prime ministers did discuss the development in the region and what challenges they pose to India-Nepal bilateral relations and what should be done to mitigate those challenges.” The two countries have signed seven agreements. One of them is renewal of the transit agreement between two countries which has paved the way for Nepal to use waterways for the shipments of goods from third countries. Indian PM Modi said transit agreements have been signed today and the two countries have established new rail links to increase physical connectivity. Likewise, the two prime ministers inaugurated the Integrated Check Post(ICP) at Nepalgunj (Nepal)-Rupaidihya (India). The two countries also signed an agreement for the phase-2 Motihari-Aklekhgunj petroleum pipeline project, Memorandum of Understanding (MoU) for the development of 480 MW Phukot-Karnali Hydro-electricity Project, and Project Development Agreement (PDA) for 679 MW Lower Arun Hydro-electricity Project. On Pancheswhor Multi-purpose development project, two countries have agreed to finalize the detailed project report (DPR) within next three months and decide on the investment modality. It has been 27 years since the two countries signed the Mahakali Treaty but it is yet to be implemented. Experts have provided mixed reactions regarding the outcome of the visit. Rajan Bhattarai, foreign affairs advisor to former Prime Minister KP Sharma Oli, said the PM’s visit failed to make concrete progress on minimizing trade imbalance, contributing to the tourism sector, ensuring air routes for newly constructed airports, and opening Indian markets for Nepali agriculture products. There was also no progress on some outstanding issues such as EPG and boundary dispute. Deep Kumar Upadhyay, former Nepali Ambassador to India, said the success of the visit shall be measured on the basis of the implementation of those agreements.  “Without intervention from the political level, it is very hard to implement the agreements reached between the two countries,” he said. Project handover, inauguration

• Handing over of Kurtha-Bijalpura section of railway line
• Inaugural run of an Indian railway cargo train from Bathnaha (India) to Nepal Customs Yard, a newly constructed rail link under Indian grant
• Inauguration of Integrated Checkposts (ICPs) at Nepalgunj (Nepal) and Rupaidiha (India)
• Groundbreaking ceremony of ICPs at Bhairahawa (Nepal) and Sonauli (India)
• Groundbreaking ceremony of phase-II facilities under Motihari-Amlekhgunj Petroleum Pipeline
• Groundbreaking ceremony of Indian portion of Gorakhpur-Bhutwal Transmission Line being built by a JV of PGCIL and NEA

MOU exchange 

• 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 the Government of India and the Government of Nepal for the development of infrastructure at Dodhara Chandani check post along India-Nepal border
• MoU between Sushma Swaraj Institute of Foreign Service (SSIFS) and the Institute of Foreign Affairs, Nepal
• MoU between NPCIL and NCHL, Nepal for cross border payment
• Project Development Agreement of Lower Arun Hydroelectric Project
• MoU between NHPC and VUCL, Nepal for the development of Phukot- Karnali Hydroelectric Project

PM Dahal Prime Minister Modiji and I discussed the boundary matters. I urged Prime Minister Modiji to resolve the boundary matters through the established bilateral diplomatic mechanisms.  I commended the role played and initiatives taken by Prime Minister Modi ji during India’s G20 Presidency as well as SCO Chairmanship, including for giving voice to the issues of concerns to the global south. Nepal is happy to join India’s multilateral initiatives of the International Solar Alliance and more recently the International Big Cat Alliance. We would like to have regular flights from Nepal’s newly built international airports of Bhairahawa and Pokhara to and from various cities of India. PM Modi Nepali PM Pushpa Kamal Dahal and I had productive talks on the progress in India-Nepal relations over the last few years and ways to deepen this cooperation even further, key sectors like commerce, energy, culture and infrastructures featured prominently in the discussions.  9 years ago, I had talked about the HIT friendship between India-Nepal relations– Highways, I-ways, and Trans-ways. Our partnership has bloomed since and we want to make our partnership a Superhit which is what these projects will achieve.