Ten years after its establishment in 2008 in the aftermath of the Koshi floods, India has communicated to the government of Nepal its decision to shut its Biratnagar-based field office.

A diplomatic spat brewed between Kathmandu and New Delhi after India’s reluctance to remove the camp. Then deputy prime minister and foreign minister Narayan Kaji Shrestha wrote to the government of India to remove the office as soon as possible, stating that its objective had been fulfilled. India later tried to upgrade the outpost to a consulate office but the plan did not materialise due to Nepal’s denial.A small office was set up in the aftermath of the floods to assist vehicular movement across the Koshi river via India when a long stretch of the East-West highway in Nepal was damaged by floods.

Raveesh Kumar, spokesperson for the External Affairs Ministry of India, late on Monday issued a statement saying: “The Biratnagar Camp Office of the Embassy of India in Nepal was opened in 2008 to deal with the situation arising out of devastating Koshi floods. The purpose for which this Camp Office was opened has been fulfilled.”He further said that the government of India had already decided to “wind up the Camp Office and re-locate the personnel”. “This decision was conveyed by Prime Minister [Narendra] Modi to his Nepali counterpart during his visit to Nepal last week. The PM of Nepal thanked PM for informing him about this decision.”

After the communication from the Indian side, PM Oli last week told a meeting of the Nepal Communist Party Parliamentary Party that India would close the Biratnagar field office. “Finally, unauthorised field office of India in Biratnagar has been closed, which we were struggling for,” Shrestha, who had taken the lead to close the camp, wrote on Twitter. “This is a historical victory of our Patriotic Stand. Big congratulations and thanks to PM Oli for this success.”

Acting Nepali Ambassador in New Delhi Bharat Raj Regmi remarked that it was a positive gesture from India. “The step taken after the visit of two prime ministers is positive. We hope the decision will be implemented soon,” he said.Nepal had repeatedly raised the issue with the Indian side, asking it to remove the field office.

The Indian side had remained silent after the foreign minister in office wrote to the Indian side again in 2013 asking it to remove the field office. Quoting some local businessmen, the Indian side later lobbied to maintain the office arguing that it had become beneficial for the traders of Biratnagar in various ways. Those standing against the office’s continuation accused India of engaging unnecessarily with the public, gathering information and influencing politics in the Madhesi constituencies.

Apart from the Biratnagar office, sources said, the Nepali side is also concerned about a growing number of Indian pension paying offices in Nepal. They claimed that there were just nine pension paying offices (PPOs) before 1990, whose number across Nepal has reached 27 now. Some interpret the network of PPOs as India’s attempt to expand its clout in Nepal.

“In this age of digital paying system, expansion of PPOs in Nepal can’t be justified,” said officials, adding that no discussion had taken place with the Indian side on the matter. “To build trust, such as by removing the field office, India should shut down unnecessary PPOs in Nepal.”