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India extended all possible support to the Government and people of Nepal in consolidating the peaceful democratic transition. The year witnessed several high level bilateral visits. Prime Minister Hon. Pushpa Kamal Dahal Prachanda’s first official visit abroad to India from September 14-18, 2008 provided broad political direction to forge a 21st century relationship with India. During the visit, the Prime Minister held talks with PM Prachanda and conveyed India’s commitment to support Nepal’s democratic and economic transformation. Drafting a new constitution and conclusion of the peace process are priorities for the Government of Nepal. India expressed its commitment to assist the Government of Nepal in these tasks. As agreed by both sides, several high level bilateral consultation mechanisms were also reactivated.

Promotion of investor-friendly business environment in Nepal would help in realization of the potential for major expansion of Indian investment in key areas like hydropower, agriculture, tourism and infrastructure in Nepal for mutual benefit.

EAM Shri Pranab Mukherjee visited Nepal in November 2008 to discuss issues of mutual interest. Foreign Secretary visited Nepal from February 17-18, 2009 to follow up on the agreements reached during PM Prachanda’s visit to India and EAM’s visit to Nepal.

Nepal and India share friendly and close political, economic, and social ties. The two nations’ strong cultural affinities and unfettered people-to-people contacts across the open border make it a relationship that has few parallels. Currently, main challenges for Nepal are drafting of a new constitution and successful conclusion of the peace process for bringing peace, stability and economic development. Following the resignation of former Prime Minister Pushpa Kamal Dahal Prachanda of Unified Communist Party of Nepal – Maoist (UCPN-M) on May 4, 2009, a new coalition government under the leadership of Mr. Madhav Kumar Nepal of Communist Party of Nepal Unified Marxist-Leninist (CPN-UML) was sworn in on May 25, 2009. Foreign Secretary visited Nepal on June 20-21, 2009, to exchange views with the Nepalese leadership on future development and strengthening of relations between the two countries. Hon Minister for Water Resources Shri Pawan Kumar Bansal visited Nepal on July 11-12, 2009 for joint inspection along with Hon. Minister of Irrigation of Nepal of the repairs carried out by GOI of the breach in embankment of the Kosi river. Nepal’s Defence Minister Mrs Bidhya Bhandari also paid an official visit to India on July 21, 2009.

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