INTRODUCTION
Nepal shares
border with 5 Indian states of Sikkim, West Bengal, Bihar, Uttar Pradesh and
Uttarakhand. The age old civilizational and cultural ties that exist between
India and Nepal are exemplified by the strong people to people link between
both the countries. Nepal is a priority partner of India under its ‘Neighbourhood
First’ Policy.
BACKGROUND
The historical relationship between India and Nepal is long and complex, dating back thousands of years to ancient times. The two countries share cultural, religious, and linguistic ties, as well as a long border that has facilitated trade, migration, and cultural exchange. As we all know, the Indian subcontinent was composed of numerous small kingdoms.
According to Muni (1973) the geographical confines of present day Nepal are the Outcome of a process of annexation and cession initiated in the latter half of the 18th century by King Prithvi Narayan Shah of Gurkha principality (p. 1).India’s relationship with Nepal is not just political and strategic, but it also contains elements of cultural, religious, emotional, and people-to-people contact that cannot be separated by any force, no matter how powerful they are. The Treaty of Sugauli, which was signed in 1815 and ratified in 1816, marked a significant turning point in the history of Nepal and the British East India Company. The agreement brought an end to the Anglo-Nepalese War that had been raging since 1814 and paved the way for a friendly relationship between the two parties.
After India gained independence, both countries signed the Treaty of Peace and Friendship on July 31, 1950, in Kathmandu.
Article
1 of the Treaty of Peace and Friendship between India and Nepal states that:
“There shall be everlasting peace and friendship between the Government of India and the Government of Nepal. The two Governments agree to acknowledge and respect the complete sovereignty, territorial integrity, and independence of each other.”
BILATERAL RELATIONS
In a reflection of India’s “Neighbourhood First” policy, there are frequent high-level visits and exchanges between India and Nepal. As India and Nepal extend visa-free entry, over the years, the movement from one country to another has not only increased tourism (Indians account for about 30% of foreign tourists in Nepal) but bilateral trade (India is Nepal’s largest trade partner). India and Nepal have been working on enhancing trade and market access through infrastructure improvements and new agreements.
The Nepal-India Trade and Transit Treaty of 2023, allows Nepal access to India’s inland waterways. Additionally, cross-border connectivity is optimised through integrated check posts at locations like Sunauli and Bhairahawa. Among the many completed and ongoing projects, the new Motihari-Amlekhgunj petroleum pipeline is an example of improved trade infrastructure for trade cooperation, saving significant costs for Nepal.
Some of the major outcomes of recent high level visits include landmark connectivity initiatives such as progress in the Integrated Check Posts at Nepalgunj, Bhairahawa and Dodhra-Chandni; inauguration of a freight train service between India and Nepal, progress on the Kurtha – Bijalpura and Raxual-Kathmandu railway line; construction of a new petroleum pipeline from Siliguri to Jhapa and Amelekhgunj to Chitwan.
During the COVID-19 pandemic, 21 trade points were halted in 2020, of which 14 were recently reopened in May 2024. This prolonged closure severely impacted Nepali traders and workers, particularly in villages near the Nepal-China border that rely on essential commodities and the sale of medicinal herbs to livestock. In contrast, India ensured the supply lines between the two nations remained open during the pandemic. India is also Nepal’s largest trade partner, with bilateral trade exceeding USD 11 billion in FY 2022-2023.
Another key highlight of India-Nepal bilateral relations is humanitarian
assistance, as Nepal is a highly vulnerable country to earthquakes. This is
where India’s aid comes into the picture. For instance, the horrors of the 2015
earthquake, which killed nearly 9,000 people and caused massive destruction,
are a poignant reminder. India was one of the first respondents to the crisis.
With Operation Maitri, India provided and continues to provide rescue, relief,
and reconstruction aid.
ECONOMIC RELATIONS
Indian firms are among the largest investors in Nepal, accounting for 35% of the total FDI stock in Nepal, worth nearly USD 777 million. Nepal is India’s 17th largest export destination, up from 28th position in 2014.India comprises about 64.1% of total trade of Nepal, equating to $7.87 billion USD (Indian FY 23-24)). This includes $7.041 billion USD of exports from India to Nepal and $829.71 million USD of exports from Nepal to India.
Nepal’s exports mainly constitute edible oil, coffee, tea and jute. Nepal’s main imports from India are petroleum products, Iron & Steel, Cereals, Vehicles and Parts, Machinery parts. There are about 150 Indian ventures operating in Nepal engaged in manufacturing, services (banking, insurance, dry port, education and telecom), power sector and tourism industries.
EDUCATIONAL
TIES
India’s development partnership with Nepal extends to the field of human resource development and capacity building. GoI provides more than 1,500 scholarships to Nepalese students each year, for courses in India as well as Nepal, across various disciplines. Since 2001, around 40,000 Nepalese students have been direct beneficiaries of these scholarship schemes.
GoI scholarships have trained 2,100 Engineers and 600 Doctors from Nepal since 2013-14. Government officials and other professionals from Nepal have been significant beneficiaries of the Indian Technical and Economic Cooperation (ITEC) programme started in 1964. Since 2001, more than 3300 professionals, bureaucrats, and defence personnel from Nepal have undergone capacity-building programmes under ITEC. In the last three years, around 171 doctors, 30 judicial officers, 60 officers from the office of the Attorney General of Nepal, 325 Nepal Police and 108 Armed Police Force professionals from Nepal have been direct beneficiaries of the ITEC Programme.
CONNECTIVITY
AND DEVELOPMENT PARTNERSHIP
India is the largest development partner of Nepal, with the major portion of our development assistance focussed on large scale infrastructure projects under grants. India has been active in extending development assistance to Nepal since the 1950s. Some of the major projects undertaken and completed with GoI grant assistance in Nepal include the Gauchar Airport (Tribhuvan Airport), East West Highway, Nepal Bharat Maitri Emergency & Trauma Centre, Tri Chand College, development projects in Tribhuvan University, BP Koirala Institute of Health Sciences in Dharan, and the construction of a 5-floor OPD complex of Bir hospital.
Several connectivity projects have been taken up, to enable and facilitate Nepal’s access to sea lanes of transport and commerce. These include:
· Rail links between Jayanagar – Bijalpura - Bardibas (Nepal’s first ever broad gauge line); Jogbani -Biratnagar; and Raxaul – Kathmandu.
· Road projects including the Hulaki/ Terai Road project;
· Integrated Check Posts (ICP) at Birgunj (Nepal’s first-ever ICP); Biratnagar; Nepalgunj, and Bhairahawa). An MoU for the construction of an ICP at Dodhara Chandani was signed in June 2023.
GoI has been working with the Government of Nepal at the grass-root level through the implementation of High Impact Community Development Projects (HICDPs) in priority sectors such as health, education, drinking water, sanitation, drainage, rural electrification, hydropower, embankment and river training so as to improve the overall quality of life of Nepalese citizens at the local level. As per the revised G2G agreement signed during EAM’s visit on 4 January 2024, the financial ceiling of an HICDP has been increased from NRs 5 Crores to NRs 20 Crores. Since 2003, over 573 HICDPs have been taken up by GoI – 495 of these have been completed and the remaining 78 are on-going.
GoI has also distributed a totally of 1,009 ambulances and 300 school buses in different parts of Nepal. These services have contributed significantly to Nepal’s health and education sectors. This is in addition to the election vehicles related support that has been provided to Nepal in the past.
PEOPLE-TO-PEOPLE TIES
India and Nepal share an organic cultural link. GoI initiatives to promote people-to-people contacts in the fields of art & culture, academia and media include cultural outreach through the organisation of specific events and programmes which have relevance in both India and Nepal. These events – including academic symposia and seminars, cultural programmes, workshops and round-tables are organised in partnership with different government bodies as well as relevant private organisations in Nepal. GoI also organises targeted familiarisation visits for media persons, and more recently for social media influencers, from Nepal in order to increase India’s people-to-people connections and outreach in Nepal. Mission also undertakes regular outreach activities for the promotion of Hindi, Sanskrit, International Day of Yoga, and other cultural activities as mandated by the Ministry from time to time.
The Swami Vivekananda Cultural Centre (SVCC) was set up in Kathmandu in August 2007 to showcase the best of Indian culture. The SVCC organises regular cultural outreach programmes, across various cities in Nepal, including large-scale events such as the India-Nepal Cultural festival in Lumbini in December 2023, and its second edition in December 2024 in Lumbini.
The Nepal-Bharat Library was founded in 1951 in Kathmandu as the first foreign library in Nepal with the objective to enhance and strengthen cultural relations and information exchange between India and Nepal.
The B.P. Koirala India-Nepal Foundation was set up in 1991 with the objective to foster educational, cultural, scientific and technical cooperation between India and Nepal and to promote mutual understanding and cooperation through sharing of knowledge and professional talents in academic pursuits and technical specialization, and has been facilitating cultural connections and exchanges between India and Nepal. Assistance is also provided to several organizations working to promote Indian culture and India-Nepal bilateral relations.
REGIONAL ALLIANCES
- SAARC: Both nations are members of the South Asian Association for Regional Cooperation (SAARC).
- BIMSTEC: Nepal is also part of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), which includes India.
- BBIN: The Bangladesh, Bhutan, India, Nepal (BBIN) Initiative focuses on sub-regional cooperation, particularly in areas like connectivity and energy.
- International Solar Alliance: Nepal joined the India-led International Solar Alliance (ISA).
- Other Forums: They also collaborate within the United Nations, the Non-Aligned Movement, and other international forums.
DEFENCE CO-OPERATION
Historically, the Armies of India and Nepal have shared an excellent and harmonious relationship based on mutual trust and respect. India and Nepal have the longstanding and unique tradition of awarding the Rank of Honorary General to each other’s Chief of Army Staff.
India and Nepal have wide-ranging cooperation in the defence sector. India has played a vital role in the modernisation and capability enhancement of the Nepali Army by provisioning of various types of defence stores and imparting regular training to personnel of the Nepali Army.
The strong relations between the two armies are exemplified through the Gorkha Regiment of the Indian Army which comprises around 32,000 Gorkha soldiers from Nepal. The Defence Wing and Pension Paying Offices of the Embassy of India in Kathmandu disburse pensions to retired Gorkha soldiers from Nepal and also organise various welfare programmes including re-training, re-habilitating and assisting ex-Gorkha soldiers and their families.
The joint military exercise between India and Nepal, Surya Kiran, seeks to enhance interoperability in jungle warfare, counter terrorism operations in mountainous terrain and humanitarian assistance and disaster relief between the two sides. The 18th edition of the exercise was held at the Nepali Army Battle School, Saljhandi (Nepal) from 29 December 2024 to 13 January 2025.
The
Indian Army has also been at the forefront of India’s humanitarian assistance
and disaster relief (HADR) operations in Nepal, particularly during the 2015
earthquake and the Covid-19 pandemic.
AREA OF CONFLICTS
(A)
Border Dispute
The primary border dispute between India and Nepal centers around the Kalapani region, including Limpiyadhura and Lipulekh. This area, located at the India-Nepal-China tri-junction, is claimed by both countries, with Nepal referencing the Treaty of Sugauli (1816) to support its claim, while India cites the river Kali's origin as the boundary. Both India and Nepal have done little to resolve the bottlenecks along their borders, including in the Kalapani region. The Kalapani border has yet to be properly demarcated, especially the so-called ‘no-man’s land’ in the area.
The Kalapani region derives its name from the river Kali. Kalapani lies on the easternmost corner of Uttarakhand’s Pithoragarh district, between Nepal and India. Nepal’s claims to the region are based on this river. The River became the marker of the boundary of the kingdom of Nepal following the Treaty of Sugauli. This was signed between the Gurkha rulers of Kathmandu and the East India Company after the Gurkha War/Anglo-Nepal War (1814-16). According to the treaty, Nepal lost the regions of Kumaon-Garhwal in the west and Sikkim in the east. The King of Nepal gave up his claims over the region west of the river Kali which originates in the High Himalayas and flows into the great plains of the Indian subcontinent. According to the treaty, the British rulers recognised Nepal’s right to the region that fell to the east of the river Kali. Here lies the historic origin of the dispute. According to Nepal’s experts, the east of the Kali river should begin at the source of the river. The source according to them is in the mountains near Limpiyadhura, which is higher in altitude than the rest of the river’s flow. Nepal claims that a land mass, high in the mountains that falls to the east of the entire stretch starting from Limpiyadhura downwards, is theirs. India on the other hand says the border begins at Kalapani which India says is where the river begins. The dispute is mainly because of the varying interpretation of the origin of the river and its various tributaries that slice through the mountains.
The dispute was revived in November 2019 when India published a revised political map showing the newly created UTs of J&K and Ladakh. The map showed Kalapani as part of Pithoragarh district. Nepal protested immediately and drew attention to the issue. Very recently, India inaugurated the Darchula-Lipulekh pass link road, cutting across the disputed Kalapani area. The road is used by Indian pilgrims to Kailash Mansarovar. Nepal hit back by summoning the Indian Ambassador to Nepal, Vinay Mohan Kwatra, to convey a formal protest.
(B) Cross
border terrorism and smuggling
The porous and
poorly guarded border between India and Nepal also poses a significant security
risk to India. Terrorist groups have exploited the border for smuggling
weapons, ammunition, trained members, and fake currency, which has implications
for India's national
security. Several reports indicate that terrorist groups such as Lashkar-e-Taiba (LeT), Indian Mujahideen, and various insurgent factions are exploiting the open border with Nepal to advance their agenda. Despite the border checkpoints, supplying trained operatives, circulation of fake Indian currency, and smuggling are some of the illegal activities noticed along the border. Additionally, the open border is misused for smuggling subsidised consumer goods. For example, Nepal, which traditionally exported rice, has been importing it for the past few years. It imported around 1.4 million tons of rice from India in 2021-2022 (worth US $473.43 million). Following this, India banned exports of broken rice. It imposed a duty on exports of various grades of rice amid the threat of El Nio disruption, as well as to boost domestic supplies and calm local prices after a below-average monsoon. However, as Indian media reports, villagers illegally smuggled rice into Nepal along the India-Nepal border.
(C) Chinese
Influence
China's influence in Nepal is growing, particularly through economic and infrastructural investments, which is shifting the traditional balance of power in the region. While Nepal maintains a close relationship with India, China is actively strengthening its ties through infrastructure projects, development assistance, and increased trade. This growing influence is prompting Nepal to navigate a complex geopolitical landscape, balancing its relationships with both China and India.
China is a major
source of FDI in Nepal, with investments in areas like hydropower, cement, and
infrastructure projects like the Pokhara International Airport. Nepal's
participation in China's BRI has led to increased infrastructure development,
including the proposed China-Nepal-India Economic Corridor, which aims to
connect the region. China is also providing financial assistance for
development projects in the border districts of Nepal. This has raised concerns
in India about Nepal's role as a buffer state between India and China and the potential
for China to exert greater influence over Nepal.
(D) Gorkha issues:
Relations came under strain when Nepal government blocked recruitment of Nepalese Gorkhas for the Indian Army’s Gorkha Regiment claiming that the Agnipath Scheme. Nepal has raised concerns about the scheme, citing potential violations of the 1947 tripartite agreement and concerns about job security and pensions for Nepali Gurkhas. Nepali Gurkhas fear the Agnipath scheme will lead to job insecurity and reduced pension benefits compared to the traditional system. While no new Gurkha recruits have been inducted into the Indian Army in recent years, the existing regiments continue to function, with a mix of Nepali and Indian-domiciled Gurkhas. The Indian Army is facing a shortage of Gurkha soldiers, particularly in filling specific positions and maintaining battalion strength.
CONCLUSION
The India-Nepal relationship has been marked by both cooperation and discord, with shared historical, cultural, and geographical ties forming the foundation of their bilateral relations. During Prime Minister Narendra Modi's tenure, the relationship has seen various challenges, including recent border disputes that have strained diplomatic ties.
References
·
India-Nepal Relations In The Modi
Era: Dynamics, Challenges, And Prospects By Krishn Kumar, Research Scholar,
University Of Lucknow, Lucknow, India, 30 August 2024
·
Developments in Nepal
and its impact on India-Nepal Relations, By: Dnyanashri Kulkarni, November 4,
2024
·
About India Nepal
Relations, Embassy of India, Nepal
·
India and Nepal’s
Kalapani border dispute: An explainer by Sohini Nayak, May 24, 2023
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