Dr. Lohani- Gujral Dialogue in 1996, Understanding for Border Regulation and Water Transport

Visit of the Foreign Minister of Nepal, Dr. P. C. Lohani to India The following is the text of. a press release issued in New Delhi on August 14, 1996 on visit of the Foreign Minister of Nepal, Dr. P. C. Lohani to India:

The Foreign Minister of Nepal Dr. Prakash Chandra Lohani paid an official visit to New Delhi from 12-14 August 1996, at the invitation of the Minister of External Affairs of India. During the course of his stay, apart from official talks with the External Affairs Minister, he called on the Prime Minister, the Home Minister, the Leader of the Opposition Mr. Atal Bihari Vajpayee,the former Prime Minister, Mr. P. V. Narasimha Rao as well as other

dignitaries and political personalities in New Delhi.

All major aspects of bilateral relations were reviewed in a warm and friendly atmosphere, which characterises the close and cordial relations between India and Nepal. The two sides expressed happiness at the growing cooperation,between the two countries. The discussions interalia covered, review of the 1950 Treaty of Peace & Friendship,questions relating to trade, transit and investment as well as regional issues.

TREATY OF PEACE AND FRIENDSHIP OF 1950

Both sides agreed to continue talks at appropriate levels on the question of reviewing the Treaty.

TRADE

The Nepalese Foreign Minister expressed appreciation at the progress made, during the recent visit of the Indian Commerce Secretary to Kathmandu, in meeting the Nepalese request for removing the 50 % material and labour content requirement for duty free imports, of products of Nepalese manufacture, into India. The understanding reached in principle. on streamlining the countervailing duties levied, on Nepalese exports to India, was also a

welcome development. The Ministers agreed that the understanding reached during thevisit, should be formalized within the near future. It was agreed that the Trade Treaty which is to expire in  December 1996, should be renewedas soon as possible and would duly reflect the above decisions.

INVESTMENTS

The sides reiterated their common desire to encourage and accelerate the pace of Indian investments in Nepal.The External Affairs Minister informed the Foreign Minister that formulation of a new policy in this regard was under consideration by the Indian Ministry of Finance. It was noted that the CII team had been commissioned to undertake a study at an early date, on the setting up of one or more Export Processing Zones in Nepal. The Nepalese

side requested that the Nepal Rashtra Bank be permitted to invest funds in high yield treasury bills in India. It was agreed to give early consideration to the request.

TRANSIT TO BANGLADESH

The External Affairs Minister noted the practical difficulties being faced by Nepal in using the existing transit route through Radhikapur. He agreed, in principle, that the Government of India will facilitate an overland transit route through and to Bangladesh. The sides agreed that appropriate modalities would be finalised expeditiously.

INDIA ASSISTED PROJECTS IN NEPAL

The sides noted that the High Level Task Force meeting had taken place last week in New Delhi, and expressed satisfaction at the good progress achieved in implementing projects in Nepal with Indian assistance.

TOURISM AND CIVIL AVIATION

The sides considered the decisions reached during the last round of 'Air Services Talks' held in New Delhi. The External Affairs Minister stated that India was favourably disposed, in principle, to the requests made by the Nepalese side. It was agreed that steps would be taken to have early bilateral talks between the Civil Aviation Ministries in order to conclude a new Civil Aviation Agreement.

RIVER NAVIGATION

Recognising the potential in the area, the sides agreed to have early discussions on utilising river transportation to facilitate movement of goods to and from Nepal.

COUNTERING TERRORISM

Both sides reiterated their commitment not to allow any activities in the territory of either country prejudicial tothe security of the other.

MONITORING OF BORDER

In order to discourage movement of undesirable elements across the open border, the two sides agreed that there should be a more effective system of monitoring of movement across the border. It was also agreed to set up a Joint Working Group to make suitable recommend

ations to the two Government in this regard.

INDIAN TEACHERS IN NEPAL

The External Affairs Minister of India apprised the Nepalese Foreign Minister of the problems being faced by Indian school and university teachers in Nepal. The Foreign Minister of Nepal assured that the matter was receiving sympathetic consideration and hoped that it would be resolved at an early date, to mutual satisfaction.

VISIT OF PRIME MINISTER OF INDIA

The Foreign Minister reiterated the invitation from the Nepalese Prime Minister, to the Indian Prime Minister\for an early visit to Nepal. The Prime Minister said that he was looking forward to the visit in the near future, on mutually convenient dates.

Aug 14, 1996

Source- Ministry of External Affairs file, Delhi