India and Nepal | PSIR Optional for UPSC (Notes) PDF Download

India-Nepal Relations

Why in News?

• Recently, the Cabinet approved an investment of ₹1,236 crore for the Arun-3 hydro project.
• This project aims to provide surplus power, strengthening India's economic ties with Nepal.

Historical Ties

• Nepal holds a special place in India's foreign policy due to geographic,historical,cultural, and economic linkages that have developed over centuries.
• Both countries share deep connections through Hinduism and Buddhism, with Lumbini, Buddha's birthplace, located in present-day Nepal.
• India and Nepal have an open border allowing unhindered movement of people, and strong bonds through marriages and familial ties, often referred to as Roti-Beti ka Rishta.
• The India-Nepal Treaty of Peace and Friendship of 1950 underpins the special relationship between the two nations.

Treaty of Peace and Friendship of 1950

Key Points from the Treaty between India and Nepal:

• The treaty ensures that Indian and Nepali citizens are treated equally in both countries regarding residence, property, business, and movement.
• It promotes national treatment for businesses, meaning that once foreign goods are imported, they are treated the same as domestic goods.
• Nepal is granted access to weaponry from India through this treaty.

Importance of Nepal

• Strategic Importance: Nepal is crucial for India’s national security as it acts as a buffer state, protecting India’s northern borders alongside Bhutan against potential threats from China.
• Geographical Position: Located in the heart of the Himalayan region, Nepal is strategically positioned between India and China, playing a vital role in regional stability.
• Water Resources: Rivers originating from Nepal are essential for India’s river systems, contributing significantly to India’s ecology and hydropower potential.
• Cultural Ties: Nepal is home to numerous Hindu and Buddhist religious sites, making it an important pilgrimage destination for many Indians, strengthening cultural and religious bonds.
• Trade and Economic Exchange: Nepal serves as a vital point of cultural and economic exchange between India and other countries like Bhutan, Sikkim, and Bihar.

Areas of Cooperation

Trade and Economy

• India is Nepal's largest trade partner and the primary source of foreign investments. India also facilitates almost all of Nepal's trade with third countries.
• Indian companies are involved in various sectors in Nepal, including manufacturing, services (such as banking and insurance), power, and tourism.

Connectivity

• Nepal, being landlocked, is bordered by India on three sides, with limited access to Tibet on the fourth side.
• India and Nepal have initiated several connectivity projects to strengthen people-to-people links and boost economic development.
• Memorandums of Understanding (MOUs) have been signed to construct an electric rail link between Kathmandu (Nepal) and Raxaul (India).
• India plans to enhance inland waterways for cargo movement, aiming to connect Sagarmath (Mount Everest) with Sagar (the Indian Ocean), providing Nepal with additional sea access.

Development Assistance

• The Government of India offers development assistance to Nepal, emphasizing grassroots infrastructure development.
• Assistance areas include infrastructure, health, water resources, education, and rural/community development.

Defense Cooperation

• Defense cooperation involves aiding the Nepalese Army in modernization through equipment and training support.
• The Indian Army's Gorkha Regiments recruit partly from Nepal's hill districts.
• Since 2011, India and Nepal conduct annual joint military exercises called Surya Kiran.

Cultural

• Initiatives have been launched to foster people-to-people connections in art, culture, academics, and media with various local bodies in Nepal.
• India has established sister city agreements linking Kathmandu with Varanasi, Lumbini with Bodhgaya, and Janakpur with Ayodhya.

Humanitarian Assistance

• Nepal, being ecologically sensitive and prone to natural disasters like earthquakes and floods, is a major recipient of India's humanitarian assistance.

Indian Community

• A significant number of Indians reside in Nepal, including businessmen, traders, doctors, engineers, and laborers, with many involved in seasonal or migratory construction work.

Multilateral Partnership

• India and Nepal collaborate in various multilateral forums, including BBIN (Bangladesh, Bhutan, India, and Nepal), BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation), NAM (Non-Aligned Movement), and SAARC (South Asian Association for Regional Cooperation).

Challenges

Internal Security Challenges and India-Nepal Relations

• Open Border and Security Risks: The Indo-Nepal border is nearly open and has minimal policing, making it vulnerable to exploitation by terrorist groups and insurgents from India's Northeast. This includes activities like the supply of trained militants and counterfeit Indian currency.
• Trust Deficit: Over time, a trust deficit has developed between India and Nepal, largely due to India's reputation for delaying the implementation of various projects in Nepal.
• Nepal's Political Instability: Nepal has experienced chronic political instability, including a decade-long violent insurgency, which has adversely affected its development and economy.
• Anti-India Sentiment: Some ethnic groups in Nepal harbor anti-India sentiments, stemming from the perception that India interferes too much in Nepal's internal affairs and undermines its political sovereignty.
• China's Growing Influence: The establishment of diplomatic relations between Nepal and China, along with China's increasing influence in the region, has weakened India's traditional leverage over Nepal.

Way Forward

• Both countries are impacted by the misuse of the open border by internal and external forces, making border management and regulation a shared responsibility.
• India should offer a new perspective on India-Nepal relations, emphasizing the deep-rooted people-to-people connections and cultural ties.
• India needs to focus on realizing the potential of hydropower cooperation with Nepal, which has been largely untapped due to differing perceptions.
• India should continue its policy of non-interference in Nepal's internal affairs while, in the spirit of friendship, guiding Nepal towards more inclusive narratives.
• Given its strategic importance to Indian security, a stable and secure Nepal is an essential concern that India cannot afford to overlook.