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    India announces landmark connectivity pacts with Nepal

    Synopsis

    In addition to rail, energy and inland waterway links, India will also extend assistance to Nepal's agriculture sector, Prime Minister Modi said.

    ET Bureau
    India on Saturday announced to upgrade road and cross-border rail and energy links with Nepal and develop inland waterways to provide sea connectivity to the landlocked country amid China’s initiatives to provide connectivity links to the Himalayan State.

    Prime Minister Narendra Modi, following his talks with PM K P Oli (who is here on his maiden trip abroad after being re-elected PM), said India would also help Nepal in the field of agriculture through organic farming, soil testing and education in farming.

    Modi said both sides would like to jointly start a new rail link connecting Kathmandu with India which will be gamechanger for the Himalayan State. “With the objective of expanding connectivity to enhance people-to-people linkages and promote economic growth and development, the Prime Ministers of India and Nepal agreed to construct a new electrified rail line, with India’s financial support, connecting the border city of Raxaul in India to Kathmandu in Nepal. As a first step, it was agreed that Government of India would, in consultation with the Government of Nepal, carry out preparatory survey work within one year, and the two sides would finalize the implementation and funding modalities of the project based on the Detailed Project Report,” read Joint Statement on rail connectivity issued after Modi-Oli talks.

    “The two Prime Ministers appreciated the progress made in the implementation of Phase-I of the India-Nepal cross-border rail link projects…The two leaders emphasized the importance of implementing the remaining three links under Phase-II of the India-Nepal cross-border rail link projects: (i) New Jalpaiguri-Kakarbhitta, (b) Nautanwa-Bhairahawa, and (c) Nepalgunj Road-Nepalgunj. Welcoming the ongoing Final Location Survey of the three links, the two leaders agreed to expedite completion of the remaining survey work,” the joint statement further added.

    In another Joint Statement on a key connectivity noted: “The Prime Ministers of India and Nepal recognised the untapped potential of inland waterways to contribute towards overall economic development of the region. Taking cognizance of their geographies and noting the development of inland waterways in both countries, the two Prime Ministers took the landmark decision to develop the inland waterways for the movement of cargo, within the framework of trade and transit arrangements, providing additional access to sea for Nepal. This new initiative would enable cost effective and efficient movement of cargo. The Prime Minister of Nepal noted the enormous impact the additional connectivity would have on the growth of business and economy of Nepal. To facilitate the movement of traffic-in-transit, the two leaders directed their respective officials to formulate and mutually agree upon the requisite procedures and modalities for including inland waterways as an additional means of transport in the Protocol to the Treaty of Transit between India and Nepal.”

    The two Prime Ministers inaugurated the Integrated Check Post at Birgunj in Nepal. They hoped that its early operationalization will enhance cross-border trade and transit of goods and movement of people bringing greater opportunities for shared growth and development. The two Prime Ministers also witnessed the ground-breaking ceremony of the Motihari-Amlekhgunj cross-border petroleum products pipeline at Motihari.

    These developments occurred in the backdrop of Nepal joining the Belt and Road Initiative last year.

    Oli is on a three-day visit to India. He promised to build a strong edifice of trust with his much larger neighbor. “We need support and cooperation of friends. Our future lies in expansion of economic engagement and bilateral trade,” he said in a statement.

    On Friday, Oli told Indian business leaders that Nepal needs massive investment in every sector. “We have enacted laws and policies on foreign investment, public-private partnerships, industrial enterprises, banking and intellectual property,” he said.

    Oli said he was committed to a liberal economy with the private sector as a key partner. “We have no intention to reverse the trends. Rest assured, we cannot go against the global trends.”

    Indian firms are the biggest investors in Nepal, accounting for nearly 40 percent of foreign direct investments in the tourism, manufacturing, banking, insurance, dry port, telecommunication and power sectors.


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