Modi is the first India prime minister to visit Nepal in 17 years. During the period, six heads of states and nine prime ministerial visits took place from the Nepali side.

Modi’s visit is perhaps most important for the political message it will deliver. His very arrival symbolically reiterates New Delhi’s support for the unfinished peace process that started in 2005 in the Indian capital, with the signing of a 12-point agreement between Seven Party Alliance and the Maoist party. 

A lot has changed in Kathmandu since. The impression in political circles is that Modi is anxious to bring a close to the political chapter that was started by another BJP Prime Minister, Atal Bihari Vajpayee. Granted, Modi will be careful not to be seen as an ‘interventionist’ neighbour but Nepali leaders will emphasize India’s political support to ensure that the post 2006 changes are institutionalised through a new constitution. Once Nepal is set as federal democratic republic (FDR), the political transition will then be complete. In her visit, widely seen as a curtain raiser to the Modi visit, Indian External Affairs Minister Sushma Swaraj stressed to major political actors that Nepal should have “an inclusive” constitution.  

Constitution writing rightly remains New Delhi’s top priority in Nepal. The reading is that timely completion of the drawn-out process is central to Nepal’s stability and that only a stable Nepal will be able to contribute to a strong neighbourhood—a cornerstone of Modi’s “neigbhours-first” diplomacy.

Swaraj’s visit also saw the two sides stress on multifaceted bilateral ties and this is where Nepal would like to see a marked shift in Nepal-India ties under Modi.

The high level bilateral mechanism, Joint Commission, held its third meeting after 23 years and the two sides agreed that JC should meet regularly.

The JC also outlined four broad areas for cooperation: political, security and border; economic cooperation and infrastructure; trade and transit; power and water resources; culture and education.

With the agreement over the revision of the Treaty of Peace and Friendship singed in 1950, New Delhi seems keen to redefine the antiquated framework of bilateral ties. The JC has directed the Foreign Secretary level mechanism to work on the outstanding boundary issues including the disputed Susta and Kalapani. For its part, Nepal has already said, it would like to see all the border disputes settled before it signs the strip maps.

But it is the potential for bilateral economic cooperation and infrastructure development, rather than tedious details of other facets of the relationship that has hogged the national limelight in the runup to the Modi visit. Nepal has put forward four major infrastructure projects (outside the hydropower projects) for Indian assistance: Kathmandu-Terai Fast Track Road (to be constructed through private sector investment); the eastern sector of Mid Hill Highway; widening of the East West Highway in the Kakarvitta-Narayanghat (472km) section; four bridges in Mahakali—three of them motorable and one a suspension bridge.

Though trade and transit issues have hardly come under the public purview, both sides are cognizant of the fact that they are crucial in addressing the hugely lop-sided Nepal-India trade. Hydropower and tourism sectors in the long term will play a crucial role in addressing the imbalance but relaxation of export barriers will be welcome measures short term. Nepali side, among others, has raised problems faced by exporters of readymade garments and herbal products to Indian markets. One tourism destination that has global significance is the Greater Buddhist Circuit that can rope in Buddha’s birthplace Lumbini with Bodh Gaya in India.

The ongoing negotiations over PTA and PDAs on Upper Karnali and Arun III underscore that some of Nepal’s political actors still find it difficult to abandon ‘water nationalism’ and paranoia over partnerships with India and Indian investors. But once the two sides agree on these land mark deals, the new confidence will provide added impetus to other big projects as Upper Marsyangdi and Tamakoshi III.

All of these are ambitious plans and will take time to fulfill. While engaging in preliminary talks to push these agendas through, Modi should simultaneously express his support for the fledgling federal democratic republic and urge our politicians to conclude the constitution drafting process so as to usher in a period of peace and stability.