With focus on strengthening connectivity, the delegation-level talks between India and Nepal chaired by visiting Nepali Prime Minister Khadga Prasad Sharma Oli and Indian Prime Minister Narendra Modi on Saturday agreed to develop a strategic electrified rail link connecting Kathmandu in Nepal with Raxual in Bihar. The project is expected to enhance people-to-people contact and allow cargo movement with landlocked Nepal. An official statement said that the two Prime Ministers agreed to construct the new electrified rail line, "with India's financial support", connecting the border city of Raxaul in India to the Nepalese capital Kathmandu. Oli thanked Modi and the people of India for according him a cordial welcome and extended an invitation to Modi to visit Nepal. Modi accepted the invitation. The agreement comes two years after China and Nepal agreed to develop a rail link that would connect Tibet with Kathmandu, Pokhara and Lumbini. Nepali Prime Minister Oli, who came to New Delhi on Friday at the invitation of Indian Prime Minister Narendra Modi, three months after being appointed Prime Minister of Nepal. Oli is known for his pro-China tilt. Apart from the rail link, China is also building three highways that would bring goods and cargo from China to Nepal. These roads are expected to be ready by 2020. The MoUs for these projects were signed in 2016 when Oli was the Prime Minister of Nepal. These MoUs with China came in the aftermath of the 135-day blockade when goods from India could not enter Nepal because Nepal was witnessing unrest over the promulgation of the constitution. The blockade continued from September 2015 to February 2016. Nepal signing MoUs with China to enhance its connectivity with its northern neighbour sparked concerns in India that it was losing its foothold in its immediate backyard despite its "neighbourhood first" policy. But the latest agreement on the proposed Raxaul-Kathmandu railway link indicates a new India-Nepal bonhomie. Nepali Prime Minister Oli said he has come to India to take India-Nepal relations to a new height.
In keeping with the tradition, he chose to visit India before any other nation. The new rail line also expected to boost economic growth and development of the two countries. A separate memorandum of understanding was signed for partnership in agriculture. Also, the interlocutors of the two countries in the presence of the two Prime Ministers inked an agreement to develop inland waterways for the movement of cargo. The inland waterways will give landlocked Nepal additional access to the sea while the cooperation in agriculture is aimed at benefitting farmers, consumers, agriculture scientists and the private sector. The two sides have agreed to boost exchange of knowledge and technology in the field of agriculture. As a first step towards building the railway connectivity, the two sides have agreed that India, in consultation with Nepal, will carry out the preparatory survey work within one year. This will be followed by the finalisation of the implementation and funding modalities of the project. The agreements and MoUs were signed on Saturday after a meeting between Oli and Modi at Hyderabad House. The two sides also agreed to expedite all India-assisted projects that are pending. Nepali Prime Minister Oli urged India to invest more in Nepal's hydropower sector.
The two Prime Ministers jointly inaugurated the Integrated Check Post at Birgunj and the cross-border Motihari-Amlekhgunj petroleum products pipeline at Motihari. Some analysts believe that the agreement to set up a rail link between India and Nepal was signed without 'adequate' preparation, as a counter to China's plan to develop a rail line connecting Tibet with Kathmandu, Pokhara and Lumbini. During Oli's first stint as Prime Minister, Nepal signed the first ever trade, transit and transportation agreement with China in March 2016. The Tibet-Kathmandu-Pokhara-Lumbini railway is in the planning phase. The agreement between Nepal and China to build a rail link between the two countries was seen as Nepal's reaction to the 2015-16 economic blockade imposed by India. India-Nepal relations had seen some tense moments when Nepal promulgated a new Constitution in 2015. India had reservations about some provisions in the Constitution relating to demarcation of certain provinces amid concerns that some communities will get marginalised in the political process. "I believe that the historic initiatives that we have taken today will make an important contribution in realising our vision of the development of both countries," Modi told media during the joint address.