India-Nepal

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CWA # 6, 18 May 2018
India-Nepal
What prevents India and Nepal from moving forward?

  Shalini E

Nepal’s transit trade to China, has become a major issue for India. China’s initiative to link Nepal with a high-speed rail link, particularly under the One Belt One Road initiative, has caused an alarm in Delhi

The recent visit of Nepal Prime Minister Oli to India did not create a positive impact on bilateral relations, for the following reasons.

Nepal’s desire to revise the Peace and Friendship treaty is a major problem in the bilateral relations. Nepal considers the treaty as unequal; a section even wants to scrap the treaty. For India, the treaty forms the bedrock of bilateral relations between India and Nepal since 1950.

Border disputes between two countries is another controversial issue, particularly in two areas – Kalapani and Susta.The Mahakali river defines the border in Kalapani, but both India and Nepal have different claims over the origin of the river causing conflict. The floods in the Narayani River which also forms the India-Nepal border has re-shaped the land, making Nepal to consider that India is encroaching the former’s territory.

India’s demonetization efforts, had bad effect on the Nepali citizins residing in both countries. People living along the border stand affected, due to their business. The issue is yet to be resolved.

Nepal’s transit trade to China, has become a major issue for India. China’s initiative to link Nepal with a high-speed rail link, particularly under the One Belt One Road initiative, has caused an alarm in Delhi. China has also pledged nearly 8 billion dollars in foreign investments to Nepal, leading to slow down of Nepal’s dependency on India in terms of trade. China’s growing influence in Nepal is not only related to trade and commerce, but a part of Beijing’s larger strategy to encircle India in South Asia.

Water Cooperation between Nepal and India has a complicated history. There have been agreements signed on major rivers, essentially for large hydroelectric and irrigation projects by building dams and barrages. No project except the Kosi barrage has been completed yet.

Shalini.E is currently pursuing Masters in International studies in Christ (deemed to be University)

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