30/03/2026
Neighbours first: On India-Nepal ties
Introduction
India’s “Neighbourhood First” policy places immediate neighbours at the center of its foreign policy priorities. Among them, ties with Nepal are unique—rooted in geography, history, culture, and an open border. Yet, despite deep interdependence, the relationship has periodically faced strains, making course correction both necessary and urgent.
Foundations of the Relationship
India–Nepal ties are anchored in:
- The India-Nepal Treaty of Peace and Friendship, enabling free movement of people and goods
- Civilizational links, including shared religious and cultural traditions
- Economic interdependence, with India being Nepal’s largest trade partner
The open border allows citizens of both countries to live and work freely, making the relationship people-centric rather than purely state-driven.
Recent Sources of Friction
Despite strong foundations, several issues have strained ties:
- Boundary Disputes
The Kalapani–Lipulekh–Limpiyadhura region has been a recurring point of contention, fueling nationalist sentiments in Nepal.
- Political Sensitivities
Perceptions of Indian interference in Nepal’s internal affairs—especially during constitutional developments—have led to mistrust.
- China Factor
Growing engagement of China in Nepal through infrastructure and connectivity projects has added a strategic dimension to the relationship.
- Economic Irritants
Trade imbalances and supply disruptions (such as during the 2015 blockade controversy) continue to influence public perception.
Renewed Engagement and Opportunities
Recent high-level visits and agreements signal efforts to stabilize ties:
- Energy Cooperation: India has increased imports of hydropower from Nepal, strengthening economic integration.
- Connectivity Projects: Expansion of rail links, cross-border transmission lines, and road infrastructure.
- Development Partnership: India continues to support Nepal in health, education, and reconstruction projects.
These initiatives align with India’s broader regional vision under “Neighbourhood First.”
Strategic Importance of Nepal
- Geopolitical Buffer: Nepal’s location between India and China makes it strategically significant.
- Water Resources: Cooperation on rivers is crucial for energy and flood management.
- Security Concerns: Open borders require coordination to address cross-border crime and security threats.
Challenges in Implementation
- Trust Deficit: Historical grievances and political rhetoric hinder smooth cooperation.
- Project Delays: Infrastructure projects often face bureaucratic and logistical delays.
- Balancing Sovereignty and Influence: Nepal seeks to diversify partnerships, while India must respect its strategic autonomy.
Way Forward
- Respect for Sovereignty: India must engage Nepal as an equal partner, avoiding perceptions of dominance.
- Expedited Project Delivery: Timely completion of infrastructure and energy projects to build credibility.
- People-to-People Connect: Strengthening cultural and educational exchanges.
- Strategic Patience: Recognizing Nepal’s engagement with China while reinforcing mutual interests.
Conclusion
India–Nepal relations exemplify both the promise and complexity of neighbourhood diplomacy. For the “Neighbourhood First” policy to succeed, India must combine strategic sensitivity with sustained engagement. A stable and cooperative relationship with Nepal is not just desirable but essential for regional stability and mutual prosperity.
