India, Nepal launch cross-border rail link, Deuba urges Modi to resolve border dispute

India and Nepal on Saturday launched several connectivity and energy cooperation initiatives, including a cross-border passenger train, even as Nepalese Prime Minister Sher Bahadur Deuba urged his Indian counterpart Narendra Modi to take steps to resolve a boundary dispute.

The Indian side made it clear both countries need to address the boundary issue through dialogue and to avoid the politicisation of such issues. The focus of the meeting between the two prime ministers was on developmental cooperation, including a joint vision statement for power cooperation that envisages joint development of projects and transmission infrastructure.

Modi and Deuba launched the 35-km cross-border railway line linking Jaynagar in Bihar to Kurtha in Nepal and flagged off the inaugural run of a train with a capacity of 1,000 passengers. This is the first broad-gauge passenger rail link between the two sides and it will be extended to Bardibas in Nepal under a project supported by an Indian grant of ₹548 crore. The train will be operated by the Nepal Railway Company (NRC).

The Indian side handed over the Solu Corridor, a 90-km, 132 kV power transmission line built for ₹200 crore under an Indian line of credit. The line will help bring electricity to several remote districts in northeastern Nepal by connecting them to the country’s national grid.

Modi and Deuba also launched India’s RuPay card in Nepal. The domestic variant of the RuPay card will now work at 1,400 point-of-sale machines in Nepal, and the move is expected to facilitate bilateral tourist flows. Nepal is the fourth country, after Bhutan, Singapore and the UAE, where RuPay is live.

Nepal signed a framework agreement to join the India-led International Solar Alliance, and the two sides signed three more pacts – a memorandum of understanding (MoU) on enhancing technical cooperation in the railways sector, and two agreements between Indian Oil Corporation and Nepal Oil Corporation for the supply of petroleum products for five years and for sharing of technical expertise.

The joint vision statement on power cooperation committed the two sides to work for joint development of power generation projects in Nepal, development of cross-border transmission infrastructure, bi-directional power trade based on market demand and coordinated operation of national grids. Nepal invited Indian firms to invest in development, construction and operation of renewable and hydropower projects.

Addressing a joint media interaction with Modi, Deuba brought up the boundary issue, which had become a major irritant in bilateral ties under his predecessor, KP Sharma Oli. The previous Nepal government had issued a new political map and claimed the territories of Kalapani, Limpiyadhura and Lipulekh.

“We discussed the boundary issue and I urged Modiji to resolve [it] through the establishment of a bilateral mechanism,” he said.

Deuba noted that Nepal’s relations with India are “highly important” and said his country is “eager to benefit from India’s progress through a mutually beneficial economic partnership”. He sought the enhancement of cooperation in civil aviation, including additional air routes, and the early delivery of 150,000 tonnes of chemical fertilisers by India.

Modi said India has been a “firm partner in the journey of peace, progress and development of Nepal and will always remain so”. He said both leaders had agreed to give priority to trade and connectivity initiatives and also discussed the misuse of the open borders by. “We stressed on maintaining close cooperation between our defence and security institutions,” he added.

Foreign secretary Harsh Shringla said the boundary and security issues were briefly discussed by the two sides. “There was a general understanding that both sides needed to address this in a responsible manner through discussion and dialogue in the spirit of our close and friendly relations, and that politicisation of such issues needs to be avoided,” he told a media briefing after the talks.

As with all neighbours, there were some outstanding issues on the table between India and Nepal, and “what is important between close and friendly neighbours is that you have the ability to...discuss and sort out these issues in a manner that is satisfactory to both sides”, Shringla said.