The sideline meet in New York

Prime Minister KP Sharma Oli and his Indian counterpart Narendra Modi met for 30 minutes on the sidelines of the 79th General Assembly of the United Nations in New York. This meeting from the Nepali side marks the first face-to-face interaction between the two leaders since they resumed their roles as prime ministers in their respective countries. 

For both Prime Ministers, this meeting comes at a pivotal moment. Having taken office for the fourth time, Oli has become one of Nepal's most experienced political figures, though his cumulative time as Prime Minister has only amounted to four-and-a-half years. This current tenure could extend for two more years, depending on the power-sharing agreement between Oli and Nepali Congress leader Sher Bahadur Deuba. If the agreement holds, Deuba will assume leadership in the second half of the government’s term. 

Prime Minister Narendra Modi has been India’s Prime Minister for a decade, serving his third consecutive term. This time, however, he leads a coalition government, which comes with certain constraints, although he remains a strong leader. Modi's leadership has significantly shaped India's foreign policy, and in recent years, his administration has adopted a more cautious, pragmatic approach to regional diplomacy. India's response to developments in neighboring countries like the Maldives, Bangladesh and Sri Lanka reflects this careful balancing act. 

Following the meeting, both leaders took to social media to express their positive impressions. Prime Minister Modi wrote on X (formerly Twitter): "India-Nepal friendship is very strong, and there is a desire to make it stronger in the future. Our discussion was on issues like energy, technology and trade." In response, Prime Minister Oli also posted on X, stating that the meeting was "fruitful" and that various aspects of bilateral relations were discussed. While the meeting was brief and took place on the sidelines of the UNGA, it nonetheless signaled an important shift in tone, where both leaders seemed keen on fostering a spirit of cooperation and mutual understanding.

Though sideline meetings like this one often do not involve detailed agenda-driven discussions, they are critical in building rapport between leaders. Exchanging warm greetings and briefly touching on key issues is often a good first step in clearing any lingering misunderstandings or tensions. The recent Oli-Modi meeting appears to have achieved this, creating a more favorable environment for addressing both long-standing and emerging issues between the two countries.

Reports suggest that the two prime ministers agreed to activate various bilateral mechanisms to resolve pending issues between Nepal and India. Currently, there are more than a dozen such mechanisms in place, many of which have been underutilized in recent years. Reinvigorating these mechanisms could provide a platform for addressing long-standing challenges such as border disputes, trade issues and developmental cooperation.

Over the past few years, Nepal’s perception of India has evolved, with India being seen more as an indispensable partner for development. The once-prevalent anti-India sentiment within Nepal has been visibly diminishing, and there is a growing recognition that cooperation with India is crucial for Nepal's economic growth and stability. This shift in public and political sentiment provides a timely opportunity for both countries to move forward on mutual concerns.

One significant aspect of the meeting, highlighted by Nepal's Foreign Minister Rana, was Oli's formal invitation for Prime Minister Modi to visit Nepal. In a departure from the traditional diplomatic practice of Nepali prime ministers visiting India first, this time Modi will visit Nepal before Oli makes a reciprocal visit to India. This move underscores the importance both countries place on revitalizing their relationship. According to Foreign Minister Rana, preparations for Modi's state visit are already underway, signaling that both sides are ready to engage in more substantive talks in the near future.

The spokesperson for Nepal's Ministry of Foreign Affairs, Amrit Rai, further emphasized a positive atmosphere created through the meeting, stating that it has helped strengthen the atmosphere of trust between the two countries. According to a statement from India’s Ministry of External Affairs, Modi took the opportunity to congratulate Nepal for becoming the 101st country to join the International Solar Alliance (ISA). Modi also emphasized the importance of regional cooperation in addressing the shared challenge of climate change.

While the New York meeting was brief, it lays the groundwork for a new normal in Nepal-India relations. Moving forward, the relationship between these two neighbors will largely depend on addressing three key areas: development cooperation, resolving historical disputes, and building trust between their leadership.

Focus on development cooperation: Nepal and India need to orient their bilateral relationship on areas where both countries share common interests, particularly in development cooperation. Nepal, given its economic size and financial limitations, cannot offer direct development assistance to India. However, India's grants, loans and joint ventures are critical to Nepal's infrastructure and energy development. Hydropower projects, in particular, represent a major area of potential collaboration. The goal of generating 10,000 MW of hydropower over the next decade, along with projects like the Janakpur-Ayodhya railway, dry ports and initiatives under the High Impact Community Development Projects (HICDP) framework are all areas where India can play a transformative role.

Nepal must ensure that these development partnerships are implemented efficiently, with proper mechanisms in place to honor commitments. However, India must also refrain from using development aid as political leverage for achieving her strategic goals. Both sides must commit to a spirit of cooperation where development serves the broader goal of mutual benefit rather than political maneuvering.

Dispute resolution: There are long-standing issues between Nepal and India, many of which are legacies from the past. Issues such as border disputes and political map disagreements have been sources of tension, but these matters can be resolved only through diplomatic dialogue. Both sides must be willing to let these issues take the necessary time rather than allowing them to escalate into more serious conflicts. Nepal should also work to address India’s legitimate security concerns, while ensuring the protection of its own sovereignty and interests. Both countries should sit together with the evidence to resolve these contentious issues.  

Building trust: Perhaps the most crucial element in Nepal-India relations is the need to build a strong foundation of trust between the political leadership of both countries. Mistrust has often arisen due to the rhetoric from leaders for domestic political purposes. While political leaders may sometimes make statements to satisfy their domestic constituencies, diplomacy requires a more measured and consistent approach. Both countries need each other’s support to flourish, and this can only happen if their leaders trust and respect one another.

In their new terms, Prime Ministers Oli and Modi have taken the first step toward rebuilding this trust. If they can continue along this path, the future of Nepal-India relations will be mutually beneficial.

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