India–Nepal Relations: Historical Ties, Treaties, Border Issues and Strategic Cooperation

India and Nepal share an open border and deep-rooted civilizational ties anchored in history, geography, culture, and economic interdependence. The bilateral relationship spans multiple dimensions, including shared river basins, defense cooperation, cross-border infrastructure, and people-to-people connections often described as the roti-beti (filial and matrimonial) relationship. Bound by a land border of over 1,850 kilometers across five Indian states, the two nations maintain a unique partnership governed by foundational bilateral agreements and strategic security arrangements.

Foundational Treaties and Historical Context

Treaty of Sugauli (1816)

• Signed between the East India Company and the Kingdom of Nepal following the Anglo-Nepalese War (1814–1816).
• Demarcated the boundary of Nepal, establishing the Kali (Mahakali) River as Nepal’s western border and the Mechi River as its eastern border.
• Formed the basis for all subsequent territorial boundaries between India and Nepal.

Treaty of Peace and Friendship (1950)

• Signed on July 31, 1950, in Kathmandu by Indian Ambassador Chandreshwar Prasad Narain Singh and Nepalese Prime Minister Mohan Shumsher Jang Bahadur Rana.
• Establishes an open border policy, allowing citizens of both countries to move freely without passports or visas.
• Grants Nepalese citizens national treatment in India regarding residence, property ownership, business operations, and government employment (excluding civil services like IAS/IFS).
• Requires both nations to inform each other of any serious friction or misunderstanding with neighboring states that could affect mutual security.

Treaty of Trade and Transit

• First signed in 1960 to provide landlocked Nepal access to sea routes through Indian ports like Kolkata and Visakhapatnam.
• Periodically revised to facilitate transit corridors and direct rail freight connectivity along routes such as Jogbani–Biratnagar and Kolkata–Nautanwa.
• Enables Nepal to execute third-country trade using Indian transport infrastructure and customs processing yards.

Border Framework and Territorial Disputes

Geography of the Shared Boundary

• Nepal shares an 1,850 km border with five Indian states: Uttarakhand, Uttar Pradesh, Bihar, West Bengal, and Sikkim.
• Over 98% of the boundary is settled through the Joint Boundary Working Group using strip maps.

Kalapani-Lipulekh-Limpiyadhura Trijunction Dispute

• Located in the Pithoragarh district of Uttarakhand at the trijunction of India, Nepal, and China.
• India treats the origin of the Kali River as the streams originating from the high ridges of Kalapani, keeping Lipulekh Pass within Indian territory.
• Nepal claims that the main branch of the Kali River originates west at Limpiyadhura, asserting rights over Kalapani, Lipulekh, and Limpiyadhura.
• Escalated in 2020 when Nepal issued an updated constitutional political map including these areas following India’s inauguration of a road to Lipulekh Pass.

Susta Border Region Dispute

• Located along the Gandak (Narayani) River on the border between Bihar (West Champaran) and Nepal (Parasi district).
• Originated due to natural shifts in the flow course of the Gandak River over several decades, leaving territorial ownership of the eroded land contested.

Defence and Security Cooperation

Military Exchanges and Joint Exercises

• Both nations maintain a tradition established in 1950 of conferring the honorary rank of General on each other’s Army Chief.
• Conduct the annual joint military exercise Surya Kiran, alternating between locations in India and Nepal to focus on counter-insurgency and disaster management.
• India provides equipment, modernization support, and military training to the Nepal Army.

Gorkha Regiments

• Citizens of Nepal are recruited into the Gorkha Regiments of the Indian Army under the Tripartite Agreement of 1947 involving India, Nepal, and the United Kingdom.
• Over 30,000 Nepalese Gurkhas currently serve in the Indian military, with around 1.2 lakh Nepalese defense pensioners living in Nepal.

Economic, Energy, and Connectivity Partnerships

Trade and Investments

• India is Nepal’s largest trading partner, accounting for over 60% of Nepal’s total foreign trade volume.
• India serves as the primary source of Foreign Direct Investment (FDI) in Nepal across manufacturing, hydropower, and services.

Energy Cooperation and Hydropower Projects

• Long-Term Power Trade Agreement (2024): Outlines a target for India to import 10,000 MW of hydroelectric power from Nepal over a ten-year period.
• Joint Vision Statement on Power Sector Cooperation (2022): Focuses on joint development of generation projects, cross-border transmission lines, and grid synchronization.
• Major hydropower projects built or planned with Indian support include the 900 MW Arun-III project, West Seti project, and the Mahakali Treaty’s Pancheshwar Multipurpose Project.
• Trilateral Energy Architecture: India facilitates cross-border transmission lines to allow Nepal to export 40 MW of electricity to Bangladesh through the Indian power grid.

Cross-Border Infrastructure

• Motihari–Amlekhganj Petroleum Pipeline: Inaugurated in 2019 as South Asia’s first cross-border petroleum pipeline, delivering fuel directly to Nepal.
• Rail Links: Operational cross-border passenger and freight rail services operate on the Jaynagar (Bihar)–Janakpur (Nepal) and Jogbani (India)–Biratnagar (Nepal) routes.
• Integrated Check Posts (ICPs): Functional at key trade locations including Birgunj, Biratnagar, Bhairahawa, and Nepalgunj to streamline customs clearance.
• Digital Financial Connectivity: Integration of Unified Payments Interface (UPI) with Nepal’s National Payments Interface (NPI) enables digital transactions across borders.

Institutional Framework Comparison

Essential Facts and Key Trivia

• The 1950 Treaty of Peace and Friendship was signed in Kathmandu by Indian Ambassador C.P.N. Singh and Nepalese Prime Minister Mohan Shumsher.
• Nepal shares a land border with five Indian states: Uttarakhand, Uttar Pradesh, Bihar, West Bengal, and Sikkim.
• Operation Maitri was India’s largest overseas disaster relief operation, launched within hours of the massive 7.8-magnitude earthquake in Nepal in April 2015.
• The Mahakali Treaty was signed in 1996 for the integrated development of the Mahakali River, including the Sarada Barrage, Tanakpur Barrage, and proposed Pancheshwar Project.
• The Motihari–Amlekhganj pipeline reduced fuel transportation costs and losses for Nepal Oil Corporation.
• Nepal became a landlocked nation bounded by India on three sides and China’s Tibet Autonomous Region to the north following the Treaty of Sugauli in 1816.
• India’s assistance program in Nepal began in 1951 with the construction of the Gauchar Airport (now Tribhuvan International Airport) in Kathmandu.
• The annual joint military exercise between the Indian Army and the Nepal Army is named Exercise Surya Kiran.