Longstanding Air Routes and Pancheshwar Hydro Project Priority Items on Kathmandu’s Agenda

Nepali Prime Minister Balendra Shah is scheduled to undertake his first official bilateral visit to India from November 22 to 25, aiming to secure critical post-flood economic assistance and advance progress on longstanding cross-border issues. Ahead of the high-level trip, Indian Foreign Secretary Vikram Misri visited Kathmandu to conduct preparatory diplomatic discussions. During the upcoming summit on November 23, Prime Minister Shah will hold delegation-level talks with Indian Prime Minister Narendra Modi, with five primary agenda items defining the strategic dialogue. First, Nepal is seeking a $2 billion financial package—comprising $1 billion in concessional loans and $1 billion in grants—to fund relief, rehabilitation, and infrastructure reconstruction following catastrophic August floods in the Rasuwa-Bhotekoshi corridor, which caused over 1,455 deaths and severely disrupted vital commercial trade routes to China. Second, Kathmandu continues to push for additional air-entry routes through Indian airspace, an ongoing request since 2014 intended to make international operations at Gautam Buddha International Airport in Bhairahawa and Pokhara International Airport commercially viable. Third, both nations hope to break decades of stagnation surrounding the Pancheshwar Multipurpose Project under the 1996 Mahakali Treaty, where discussions have narrowed cost-sharing splits to 25–30 percent for Nepal with India bearing the remainder, though definitive agreements on water benefit distribution remain pending. Fourth, boundary disputes involving territorial claims over Kalapani, Limpiyadhura, and Susta represent sensitive political topics; although left out during preliminary secretarial meetings, Nepali officials express hope that border resolution will be addressed given Shah’s evolving diplomatic stance. Finally, the bilateral visit will feature tangible progress through the joint inauguration and launch of several major India-backed infrastructure ventures. The two prime ministers are expected to inaugurate the Nepal Police Academy in Panauti, an integrated check post in Bhairahawa, a motorable bridge over the Mahakali River, and a new bridge in Darchula. Furthermore, the leaders are set to jointly launch construction on the Dodhara Chandani integrated check post, the Lower Arun hydropower project, and an cross-border petroleum pipeline connecting Siliguri with Charali, while preparing for newly tested direct railway operations connecting Ayodhya and Janakpur.