GS2 – International Relations
Context:
India has recently entered into an agreement with Nepal to implement five High-Impact Community Development Projects (HICDPs) in the education and health sectors, backed by an Indian grant of ₹390 million.
High-Impact Community Development Projects (HICDPs)
| Sector | Projects |
| Education | Construction of four secondary schools in the districts of Dhanusha, Parsa, Achham, and Bara. |
| Health | Development of a 5-bed hospital in the Manang district. |
Strategic Importance
- Support for Social Sectors:
These initiatives improve access to healthcare and education in remote regions of Nepal, aligning with the country’s decentralisation and development objectives. - Instrument of Soft Power:
India strengthens its image as a compassionate and reliable partner by delivering grassroots development, fostering deeper interpersonal and diplomatic ties. - Confidence-Building Measure:
By adopting a proactive approach in regional development, India reinforces its role as a responsible “Big Brother,” fostering regional goodwill and long-term stability.
Bilateral Trade and Cultural Bonds
- India remains Nepal’s largest trade partner and top source of Foreign Direct Investment (FDI), with bilateral trade surpassing $7 billion.
- Shared cultural traditions—embodied in the “Roti-Beti ka Rishta”—and the open border encourage deep-rooted interpersonal ties, mutual celebrations, and uninterrupted pilgrimages and tourism.
Key Challenges in India–Nepal Relations
- Border Disputes:
Disagreements persist in regions like Susta, Kalapani, and the Lipulekh tri-junction. - Delayed Project Implementation:
Historic agreements such as the Kosi (1954) and Mahakali (1996) Treaties remain partially implemented, stalling projects like the Pancheshwar Multipurpose Project. - Security Vulnerabilities:
The porous border facilitates illegal migration, infiltration, and human trafficking. - Treaty Asymmetry:
Nepal perceives the 1950 Indo-Nepal Friendship Treaty as outdated and disproportionately favourable to India. - Influence of China:
China’s growing presence and chequebook diplomacy pose strategic challenges to India’s traditional influence in Nepal.
Way Forward
- Expedite Project Execution:
Fast-track critical projects such as the Pancheshwar Multipurpose Project to rebuild mutual trust. - Political Engagement:
Adopt quiet diplomacy to resolve internal issues like the Madhesi question and enhance bilateral cooperation. - Leveraging Soft Power:
Expand cultural exchanges, implement UPI-RuPay integration, and promote academic collaboration to deepen societal ties. - Counterbalance Strategy:
Offer transparent and sustainable alternatives to counterbalance China’s strategic outreach in the region.