MoU Between India & Nepal: Impact on Bilateral Relations

MoU Between India & Nepal: Impact on Bilateral Relations

Question: Union Cabinet has recently given its approval for the signing of an MoU between GoI and Government of Nepal. Discuss how this will impact bilateral relations between the two nations

- Union Cabinet has recently given approval for an MoU between GoI and Government of Nepal

- The MoU is for construction of a petroleums products pipeline from Raxaul in India to Amlekhgunj in Nepal

- It also involves the re-engineering of Amlekhgunj Depot and allied facilities

- MoU will promote bilateral cooperation within the oil and gas sector and securing long term supply of petrol products for Nepal

- This will also result in environmental preservation along the route and decongest the global border at Raxaul

- Government of Nepal had requested GoI to construct petrol products pipeline and the request had been concurred with by India

- IoC has been entrusted with the task of pipeline construction and re-engineering of Malekhgunj Depot and associated facilities

- This is a long term contract of 15 years between IOC and Nepal Oil Corporation

Facts and Stats

- India is the largest trade partner and source of investment for Nepal

- Total bilateral trade has reached US $3.21 billion (NRS 257.10 billion) during the fiscal year 2009-2010

Bilateral mechanism for trade and transit is provided through the following:

- India-Nepal Treaties of Trade, of Transit,

- Agreement for Co-operation to Control Unauthorised Trade, 1991.