Bilateral Relations
(Nepal-India)
1.
Nepal and India enjoy excellent
bilateral relations, and treasure very close, comprehensive and
multidimensional relations since centuries. The relations are strengthened
further by the age-old ties of history, culture, tradition and religion, and
pronounced more in political, social, cultural, religious and economic dealings
with each other. To add up the formal flavor to this historic relations, Nepal
and India established diplomatic relations on 17 June 1947. The unfathomable
commitment to the principles of peaceful coexistence, sovereign equality, and
understanding of each other’s aspirations and interests have been the firm
foundations on which our subsisting relations have been moving to a new height.
2.
In pursuance of Nepal's solemn
desire to cultivate and foster the cordial and friendly ties with its
neighboring countries, Nepal has been pursuing its long standing position not
to allow its territory to be misused by any inimical elements against
India and also expects same sort of reciprocity and assurances from her.
3.
The open border between the two countries has been a unique paradigm of our
ties that rarely exists around the world. Frontier without restriction has
greatly facilitated the free movements of our people to each other’s territory.
Moreover, such facilitation of the movement of the people has increased more
exchanges and interactions at the people-to-people level. In essence, our
relations are much more than the sum of treaties and agreements concluded
between the two countries. It is therefore natural that our main thrust now has
been to further widen and deepen our bonds of ties to the mutual satisfaction
of our people.
4.
Both countries have common approach and work in tandem in the United Nations,
Non-alignment Movement and other international fora on most of the important
international issues that have bearing on us. Furthermore, with the
establishment of SAARC and BIMSTEC in South Asia, more avenues for enhancing
regional cooperation have been identified so as to leap forward towards
regional economic integration, which is considered as a precursor to the
Economic Union, through harnessing collectively the potentials and
complementarities available in the region.
5.
The Government of India (GOI) strongly supported peaceful People's Movement of
April 2006 for the restoration of full democracy in Nepal. The GOI welcomed the
promulgation of the Interim Constitution and the formation of the Interim Legislature
in Nepal on 15 January 2007 and the Constituent Assembly elections in Nepal on
April 10, 2008.
6.
Nepal highly appreciates India for the moral and physical support rendered to
the Nepalese people for their arduous tasks to bring a historic change of high
proportion in the country and hopes that India will continue to do so in the
days to come.
A. Exchange of Visits
7. The frequent high level visits by the leaders of the two countries at different points of time and the interactions thereof constitute the hallmark of the ties between Nepal and India. Furthermore, such visits have helped promote goodwill, understanding and cooperation between the two countries and, have injected a fresh momentum to further consolidate Nepal's age-old and multi-dimensional relations of friendship and cooperation with India on a more matured and pragmatic footing.
Ø
After the dawn of the epoch-making events in the annals of the Nepalese
history, Right Honourable Dr. Ram Baran Yadav, as the first President of the
Federal Democratic Republic of Nepal Paid a State visit to the Republic of
India on 15-18 February 2010 at the invitation of Her Excellency Pratibha
Devisingh Patil, President of India. The Rt. Hon. President Dr. Ram Baran Yadav
also paid an Official Visit to India from 27 January to 5 February 2011.
Ø
In continuation to that tradition, the Right Honorable President Dr. Ram Baran
Yadav paid an official visit to India from 24-29 December 2012 at the
invitation of His Excellency Mr. Pranab Mukherjee, President of the Republic of
India. The Rt. Hon. President graced as Guest of Honour the Special Convocation
of Banaras Hindu University (BHU) at the closing ceremony of year-long
celebrations of the 150th Birth
Annivarsary of the founder of BHU, Mahamana Pandit Madan Mohan Malaviya where
the President was conferred an honorary doctorate degree.
Ø
At the invitation of His Excellency Dr. Manmohan Sing, Prime Minister of India,
the Right Honourable Dr. Baburam Bhattarai, Prime Minister of Nepal, paid an
official visit to India on 20-23 October 2011. The Rt. Hon. Prime Minister of
Nepal also held meeting with his Indian counterpart on the sidelines of the
Seventeenth SAARC summit in Addu City, Maldivies, on 11 November 2011. And
again, he held meeting with his Indian counterpart on the sidelines of the
United Nations Conference on Sustainable Development (RIO + 20 Conference), Rio
de Janeiro, on 20 June 2012.
Ø
Former Prime Minister Mr. Madhav Kumar Nepal paid an official visit to India at
the invitation of His Excellency Dr. Manmohan Singh, Prime Minister of India on
18-22 August 2009.
Ø
Similarly, former Prime Minister Mr. Pushpa Kamal Dahal ‘Prachanda’ paid an
official visit to India on 14-18 September 2008. The Prime Minister also held
bilateral meeting with the Indian Prime Minister Dr. Manmohan Singh on the
sidelines of the Second BIMSTEC Summit on 13 November 2008 in New Delhi.
Ø
In the same vein, former Prime Minister Girija Prasad Koirala paid an official
visit to India on 6-9 June 2006 just after the success of the people's movement
II for the restoration of democracy that led Nepal to a Republican country.
Prime Minister Koirala also held bilateral discussion with Indian Prime
Minister Dr. Man Mohan Singh on 2nd August 2008 on the sideline of the 15th
SAARC Summit in Colombo.
Ø
Similarly, the former Ministers for Foreign Affairs of Government of Nepal paid
official visit to India at different points of time in the past: Mr. K.P.
Sharma Oli (2006), Ms Sahana Pradhan (2007), Mr. Upendra Yadav (2008) and Ms.
Sujata Koirala (2009).
Ø
External Affairs Minister of India Mr. S.M. Krishna visited Nepal on 15-17
January 2010 at the invitation of Hon’ble Deputy Prime Minister and Minister
for Foreign Affairs Sujata Koirala. His Excellency S.M. Krishna also paid an
official visit to Nepal on 20-22 April 2011.
Ø
Former External Affairs Minister Mr. Pranab Mukherjee paid an official visit to
Nepal at the invitation of the former Foreign Minister of Nepal on 24-26
November 2008 and reviewed the progress made on the understanding reached
during the Nepalese Prime Minister’s visit to India in September that year.
Shri Pranab Mukherjee in the capacity of the Finance Minister of India also
visited Nepal on 27 November 2011 to sign the Agreement for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on
Income.
B. Economic Cooperation:
8.
India has been assisting towards the development of infrastructure and human
resources in Nepal, with the maiden programme of cooperation launched in 1951.
The Indian cooperation started in 1952 with the construction of an air-strip at
Gaucharan. Such assistance received from India has helped supplement the
developmental efforts of the Government of Nepal. India's economic assistance
to Nepal has grown manifold in the past few years, particularly since the
restoration of multiparty democracy in Nepal.
9.
An agreement was signed between GON and GOI on November 7, 2003 to facilitate
implementation of “Small Development Projects Scheme (SDPS)” in the sectors of
education, health, and community development for a period of two years. The
agreement has been renewed regularly and the last renewal was effective from 6
August 2011. The assistance is reflected in Nepal’s budget each year. The SDPs
are community-owned and executed by the local agencies of Government of Nepal,
(Such as the DDC, DUDBC, DOR, NEA etc) as per norms and regulations of the
Government of Nepal after signing the project specific tripartite MoU between
the Embassy of India in Kathmandu, the executing agency and the beneficiary.
C. Physical
Infrastructure
10.
During the State visit of Rt. Hon. Dr. Ram Baran Yadav, President of Nepal to
India from February 15-18, 2010 following Agreements/MOUs were signed:
(i)
Air Services Agreement between Nepal and India,
(ii)
Memorandum of Understanding on Development of Railway
Infrastructure
at Five
Border Points along the Nepal-India Borders,
(iii)
Memorandum of Understanding on the establishment of Nepal-Bharat
Maitri Polytechnic at Hetauda, and
(iv)
Memorandum of Understanding on Construction of Nepal-Bharat Maitri
Sabha Griha for Birgunj Sub-Metropolitan City Office at
Birgunj
11.
Following MOUs between Nepal and India were signed during the visit of External
Affairs Minister of India Mr. S.M. Krishna to Nepal on 15-17 January 2010:
(i)
MoU regarding Strengthening of Road Infrastructure in the Terai Area of Nepal,
(ii)
MoU relating Grant Assistance from Government of India under Small
Development Projects for Electrification
of five VDCs in Nepal,
(iii)
Agreement between Nepal Stock Exchange Limited (NEPSE) and Central
Depository Services (India) Limited (SDCL) for setting up a Central Depository
and Clearing and Settlement System , and
(iv)
MoU on the establishment of the Nepal –Bharat Science Learning
Center
at
Khumaltar Lalitpur)
Large and Intermediate Projects
A. Ongoing
large and intermediate projects: The followings are the on-going large and
immediate Projects:
I. B. P. Koirala Institute of Health Sciences, Dharan: Infrastructure
part has been completed and faculty support is ongoing. The institute building
was formally handed over to GON in September 1999.
II. Establishment of 200 beds Emergency and Trauma Centre at Bir
Hospital, Kathmandu: MoU for establishment of the Emergency and
Trauma Centre was signed between GOI and GON on 30 July 2003. This is the
second trauma centre of its kind amongst SAARC countries, first one being
AIIMS, New Delhi. Construction is completed. The project is yet to be handed
over to Nepal.
III. Establishment of Manmohan Memorial Polytechnic at Biratnagar: Tripartite
agreement between GOI, GON and Manmohan Memorial Foundation (MMF) was signed on
30 June 2003. Former Prime Minister Mr. Madhav Kumar Nepal and India’s
former Ambassador Mr. Rakesh Sood inaugurated this institute on 2 November
2009.
IV. Establishment of a Science Learning Centre(SLC) at Kathmandu: Nepal
Academy of Science and Technology (NAST) and National Council of Science
Museums of India (NCSM) signed an MOU in 2002 to facilitate science promotional
activities including setting up of a Science Learning Centre at Kathmandu. MoU
for construction of a Science Learning Centre with Indian Government’s
assistance was signed by the Foreign Secretary of India, the Finance Secretary
of Government of Nepal and the Vice-Chancellor of National Academy of Science
& Technology on 15 January 2010.
V. Integrated Border Check-Posts: Integrated check-posts
have been proposed at four points on Indo-Nepal border namely (i)
Raxaul-Birganj, (ii) Sunauli-Bhairahawa, (iii) Jogbani-Biratnagar and (iv)
Nepalganj road-Nepalgunj. DPR for all the four points has been prepared. The
construction of ICP in Birgunj is ongoing. ICPs at Biratnagar, Bhairahawa and
Nepalgunj are to be constructed.
VI. Terai Roads: DPR’s of the 20 roads of phase I are
being prepared. MoU for strengthening of Road infrastructure in the Terai Area
of Nepal with Indian assistance was signed by the Deputy Prime Minister and
Foreign Minister of Nepal and the Minister of External Affairs of India
on 15 January 2010 in Kathmandu. During the visit of Nepal, the Minister of
External Affairs of India laid foundation stone of the first Phase of Tarai
Roads in Birgunj on 22 April 2011.
VII. Rail Links: Memorandum of Understanding on
Development of Railway Infrastructure at Five Border Points along the
Nepal-India Borders was signed in 2010. The
construction
process has been initiated. Land acquisition in Jogbani-Biratnagr and
Jayanagar-Janakpur-Bardibas-Bijalpura sectors is in progress.
VIII. Mahendranagar-Tanakpur Link Road: Agreement for
the project was signed through exchange of letters between GOI and GON on 2
January 2003. DPR of the road has been revised after considering the
realignment and the road specification is upgraded to match the Asian Highway
Network standard. Besides, as per the new alignment, an additional 7000 sq m of
the land has to be acquired in Nepalese territory. GON has
already acquired the required land and the track has been constructed to secure
the right of the way. The concerned Indian agency is to expedite and complete
the land acquisition and other related clearances at the earliest.
IX. Hetauda Polytechnic: DPR for the polytechnic has
been prepared. Memorandum of Understanding between Government of Nepal and
Government of India regarding the establishment of Nepal Bharat Maitri
Polytechnic at Hetauda in Makawanpur District, Nepal was signed on 16 February
2010 in New Delhi.
X. Central Depository System (CDS) in Nepal for development of
financial markets in Nepal: An Agreement between Nepal Stock
Exchange Limited (NEPSE) and Central Depository Services (India) Ltd. (CDSIL),
India was signed on 15 January 2010 for setting up of a Central Depository and
Clearing and Settlement System
D. Water
Resources
12.
Water resource is considered as the backbone of Nepalese economy. The issue of
water resources has always been getting due prominence in the agenda of
bilateral cooperation between Nepal and India since long time back so as to
generate power and provide irrigation facilities by constructing mega Projects.
However the flashfloods, erratic behavior of the rivers and the construction of
the barrage along Nepal India border, have submerged Nepalese territory causing
huge losses of lives and properties during the monsoon. With a view to
optimizing the benefits and addressing the problems, both Governments have set
up three- tier mechanisms called Joint Ministerial Commission for Water
Resources (JMCWR), Joint Committee on Water Resources (JCWR) and Joint Standing
Technical Committee (JSTC) to implement agreements and treaties and also address
water induced problems of flood and inundation. There is also an additional
mechanism - Joint Committee on Inundation and Flood Management (JCIFM) - which
deals explicitly with the issues of inundation, embankments and flood
forecasting.
E. Trade,
Transit and Investment
13.
Trade and transit issues with India are of utmost importance to Nepal. India is
the largest trading partner of Nepal. And for the third country trade, India
has provided transit facility to Nepal. Similarly, both public and private
sectors of India have invested in Nepal. The trade statistics reveals
phenomenal increase in the volume of bilateral trade over the years between the
two countries. However, Nepal has escalating trade deficit with India. Nepal
and India have a Treaty of Trade and the Agreement of Cooperation to Control
Unauthorized Trade signed on 27 October 2009 with its validity of seven years
along with the provision of automatic extension for further periods of seven
years at a time. They also have treaty of transit, which has been renewed for a
period of seven years until 5th January
2020.
14.
With a view to promoting, facilitating, expanding and diversifying trade
between the two countries and encouraging collaboration in economic
development, Bilateral Investment Promotion and Protection Agreement (BIPPA)
was signed in New Delhi on 21 October 2011. To give further momentum to Nepal
India Trade, Agreement for the Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with respect to Taxes on Income was also signed in Kathmandu
on 27 November 2011.
15.
Pursuant to the provision of the Treaty, to oversee the matters related to the
implementation of treaty, bilateral trade, transit and investment issues, the
Inter-Governmental Committee (IGC) and the Inter Governmental Sub-Committee
(IGSC) mechanisms are set up at the level of Commerce Secretaries and Joint
Secretaries of both countries respectively.
F. Security Cooperation
16.
Security related issues are the prime concerns of both the countries. To deal
jointly with each other's security concerns, the two countries have established
the following mechanisms: Meeting of the Home Secretaries, Nepal-India
Bilateral Consultative Group on Security Issues (NIBCGSI), Joint Working Group
on Border Management (JWG) and Border District Coordination Committee (BDCC).
South Asia Division
Ministry of Foreign Affairs
Kathmandur,
January 2013
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