India and Nepal Need Institutions That Match Their Ties

In July 2025, at a security seminar in Kathmandu held in the aftermath of the Pahalgam attack, senior Nepali figures—including an adviser to Nepal’s president and several former ministers—warned openly that Pakistan-based networks like Lashkar-e-Taiba and Jaish-e-Mohammed could exploit the open border to move against India and called for deeper intelligence sharing and joint border management between the two countries.

The attack itself had underscored the stakes. Among the 26 killed in the Baisaran Valley on April 22, 2025, was a Nepali citizen, a reminder that the threats facing the two countries are not limited by geography. That Nepali leaders were prepared to say publicly, “In the fight against terrorism, we are with India,” as one former foreign secretary put it, was a significant statement of frank collegiality, signaling the kind of partnership on which good relationships are built and a reminder of how much more the India-Nepal relationship is capable of when it operates at its best.

India and Nepal share one of the world’s most unusual bilateral arrangements. Citizens of both countries may cross the border freely and enjoy exceptional rights to live, work and conduct business in each other’s territory without visas or passports, subject to domestic law. Generations of Nepali soldiers have served with distinction in the Indian Army. The two countries share river systems, power grids, pilgrimage routes and family ties that predate the modern states themselves. This is not merely a neighbourly relationship. It is, in many respects, a civilizational one.

Yet the depth of that bond has not always translated into the depth of institutional cooperation that both countries need. The challenges they face together include a porous border exploited by criminal and terror networks, the narcotics surge flowing out of Southeast Asia, counterfeit currency circulation, human trafficking and the shared need for disaster preparedness along seismically active terrain. This reality demands a more structured, durable and forward-looking partnership than either country has yet built. The good news is that the foundation is already there.

The shared security challenges are real and growing. The open border, for all its historic and human value, has been exploited by networks trafficking counterfeit Indian currency, narcotics, arms and people. Lashkar-e-Taiba and Jaish-e-Mohammed operatives have at various points used it as a transit corridor. The synthetic drug surge flowing from Southeast Asia’s Golden Triangle is increasingly moving through South Asia, with both India and Nepal’s geographic position making them vulnerable both as transit routes and as destinations. These are not Nepal’s problems or India’s problems in isolation. They are shared problems requiring shared solutions.

Both countries have also begun to recognize this. A mutual legal assistance treaty designed to facilitate cross-border criminal investigations, evidence sharing and the prosecution of transnational offenses has been under consideration as a bilateral priority. Joint border management infrastructure is being expanded. Intelligence cooperation has deepened in the years since both governments identified cross-border crime as a common concern. These are meaningful steps, and they deserve to be acknowledged as such.

Nepal’s new government adds a fresh opportunity. The elections of March 5, 2026, delivered the reformist Rastriya Swatantra Party a historic mandate, giving it a parliamentary majority without a coalition for the first time in more than two decades. Balen Shah, the former mayor of Kathmandu, was sworn in as prime minister on a platform of practical, anti-corruption, results-oriented governance. India, for its part, has shown in recent years that it can move quickly on bilateral deliverables when the political relationship is in good order. Hydropower cooperation, rail connectivity and the revival of people-to-people programs are all evidence of what the partnership can produce when both sides pull in the same direction.

The path forward is clear enough. What it requires is commitment from both sides.

First, the mutual legal assistance treaty should be finalized and operationalized without delay. Cross-border crime does not pause for parliamentary calendars, and every month that the framework sits incomplete is a month in which trafficking and currency-counterfeiting networks operate without the friction of coordinated prosecution.

Second, both countries should establish a permanent joint security working group at the level of senior officials—not ad hoc meetings convened in response to crises but a standing mechanism that meets regularly, shares threat assessments and coordinates responses to emerging challenges. The July 2025 warnings from Nepali security figures are an example of the candor such a body could institutionalize. That candor should become standard practice rather than the exception.

Third, India’s development partnership with Nepal must be deepened and accelerated. Nepal’s hydropower potential is extraordinary. The two countries have agreed on a framework under which Nepal would export nearly 10,000 megawatts of electricity to India over the coming decade. Realizing that potential would transform Nepal’s economy and strengthen the energy security of both countries. Prioritizing these projects and ensuring that implementation is transparent and genuinely beneficial to Nepali communities would do more for the long-term health of the partnership than any number of diplomatic communiqués.

Fourth, people-to-people ties must be institutionally supported. Academic exchanges and cultural connections are the connective tissue of a relationship that has always been as much human as it has been strategic. They should be treated as strategic assets.

Finally, disaster preparedness and climate resilience cooperation deserve far greater investment than either country has yet made. Both India and Nepal sit on some of the world’s most seismically active terrain. Both face accelerating threats from glacial lake outburst floods, erratic monsoons and the broader pressures of Himalayan climate change. A joint early-warning system and shared emergency response protocols would save lives in both countries and build precisely the kind of practical trust that makes other forms of cooperation easier.

None of this is to pretend the relationship is without friction. It has had serious low points, and a credible partnership agenda has to be honest about them rather than wish them away. The most visible is the territorial dispute over Kalapani, Lipulekh and Limpiyadhura, the strip of land in the far northwest that both countries claim, which flared again in 2020 when Nepal issued a revised official map and amended its Constitution to incorporate the area. Beyond the map, the legacy of past disruptions to cross-border trade and supply, periodic flares of nationalist sentiment on both sides and long-standing Nepali calls to revisit the terms of the 1950 Treaty of Peace and Friendship have all, at various moments, strained ties.

India’s approach to these frictions, and to the relationship as a whole, is best served on its own bilateral terms and on its own merits. The case for a stronger institutional architecture rests precisely on this reality: Durable mechanisms matter most not when relations are warm but when they are tested. Boundary disputes are resolved, if they are resolved at all, by patient technical negotiation and political trust built elsewhere in the relationship, not by goodwill alone. Structures that outlast any single government or grievance are what allow neighbours to keep cooperating through the inevitable rough patches.

The India-Nepal relationship has endured for centuries because it is grounded in something deeper than strategic calculation—in shared heritage, shared rivers, shared gods and shared families. That foundation does not need to be built; it already exists. What both countries owe their people is the institutional architecture to match the warmth of the relationship with the rigor it deserves. The challenges of the coming decade, from synthetic narcotics to climate displacement to regional connectivity, will be easier to navigate together than apart. Both countries know this. The task now is to act on it.

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