(Updated with new information on investment protection and double taxation)
Chairman Dahal arrives in New Delhi
NEW DELHI, Aug 18: Prime Minister Madav Kumar Nepal arrived here Tuesday afternoon on his five-day visit to India.
Prime Minister Nepal busied himself with several meetings soon after landing in New Delhi. Nepal first attended a program organized by Nepal Democracy Solidarity Group and then met senior leaders of the Communist Party of India (Marxist), Sitaram Yechuri, BJP leader Arun Jately and in the evening, he participated in an interaction program organized by Embassy of Nepal with the Nepali community in Delhi. [break]
The prime minister is scheduled to hold his bilateral meetings with Indian leaders since Wednesday morning and will attend a banquette dinner hosted by Prime Minister of India, Dr Manmohan Singh, in the evening.
Talking to media persons in the evening, Prime Minister Nepal said he was confident about the success of his visit. “From my meetings with various leaders this evening I have gathered that India has attached high importance to my visit and I am confident about its outcome.”
Though Prime Minister Nepal himself has termed his India trip as a “goodwill visit”, there are several issues on the table for negotiations. The two sides are expected to finalize and Trade Treaty.
The Trade Treaty, which will basically upgrade the existing treaty, is expected to exempt Nepali exports from all sorts of non-tariff barriers and other additional duties to provide an impetus to the sluggish Nepali export to Indian market. Nepal currently suffers a huge trade imbalance with India that has doubled in the last five years to reach over Rs 108 billion – a whopping 16 percent of the Gross Domestic Product.
However, contrary to what was expected earlier, the two sides are unlikely to sign treaties on investment protection and avoidance of double taxation. “We have decided to defer a treaty on investment protection because of lack of complete homework on our side,” said the prime minister.
A senior foreign ministry official told Republica that the two sides will also postpone signing a treaty on avoidance of double taxation under a request from India.
The prime minister’s delegation, however, seemed confident that India would agree to take up a high-profile Bagmati Civilization Development Project under which the Bagmati River and its 26 tributaries in Kathmandu will be cleaned inside the Kathmandu Valley. Prime Minister Nepal had requested his Indian counterpart Dr Manmohan Singh to consider the project when the two met in the sidelines of the NAM summit in Egypt last month and had secured a positive response from the Indian premier. Immediately after the NAM summit a team of Indian experts flew to Kathmandu and studied the feasibility of the project. “The team has estimated the cost of the project at Rs 19 billion and we are optimistic that India will agree to take up the project,” said a top aide to PM Nepal.
India and Nepal are also likely to push forward the DPR process of the Pancheshwar Project and the two sides seem to have agreed to mention it in the join press communiqué.
Prime Minister Nepal’s delegation seemed a little miffed over the last-minute cancellation of her visit by Foreign Minister Sujata Koirala but when asked by journalists to comment on it PM Nepal said, “What can you do when someone feels physically ill?” However, there is some concern in New Delhi about whether and how Prime Minister Nepal’s rejection of NC President Girija Prasad Koirala’s request to upgrade his daughter to the post of deputy prime minister plays out in the future.
Earlier, before flying to New Delhi, the prime minister told reporters at Kathmandu airport that he will not sign any "unequal" treaty with India. The prime minister said he would sign two treaties -- Trade Treaty and Treaty to Control Unauthorized Trade -- with India only if both the countries agree on the provisions of the treaties.
ameet@myrepublica.com
