Why in the News?

The Government of Nepal has decided to come out with a Rs-100 currency note that depicts the country’s map with India’s territories.

What’s in Today’s Article?

• Background (Context of the Article, Historical Background)
• Recent Dispute Between India and Nepal (Cause & Effect)
• News Summary

Background:

• In May 2020, the Government of Nepal had released an updated political map of the country, claiming Kalapani, Limpiyadhura and Lipulekh of Uttarakhand as part of Nepal’s territory.
• 
• Both India and Nepal lay claim to Kalapani region.
• The Kalapani region derives its name from the Kali River. In Nepal, the river is known as Mahakali and it holds as much significance in Nepal as the Ganga River does in India.
• The river works as a natural border between India and Nepal.
• The source of the Kali River has been a point of dispute between India and Nepal.
• India’s Stand:
  • India states that Kalapani is in Pithoragarh, Uttarakhand where the river originates from.
• Nepal’s Stand:
  • Nepal alleges that the river originates either from Limpiyadhura or from Lipulekh and considers both the locations as part of Nepal’s Sudurpaschim province.

Historical Background:

• Under the Treaty of Sagauli (1816) signed between British East India Company and Nepal, the Kali River was marked as Nepal’s western boundary with India.
• It, however, made no mention of ridgeline and the subsequent maps by the British surveyors showed the source of the Kali River at different places.
• This discrepancy has led to the boundary disputes between India and Nepal.
• Officially, Nepal brought the issue of Kalapani before India for the first time in 1998.

Recent Dispute Between the Two Countries:

• Earlier in 2020, Defence Minister of India Shri Rajnath Singh had inaugurated a new link road from India to China to shorten the travel time for pilgrims to Kailash Mansarovar via Lipulekh pass.
• The road starts from Dharchula in Uttarakhand to Lipulekh pass.
• Nepal had protested strongly against this move by India and claimed that it is a breach of agreement reached between the Prime Ministers of India and Nepal in 2014 to work out on the outstanding boundary issues on Kalapani and Susta (West Champaran, Bihar).
• In response, a Constitutional Amendment Bill was passed by Nepal’s parliament to legitimize the alteration to the country’s map with the addition of Kalapani, Lipulekh and Limpiyadhura.
• The passage of the Bill and the new map led to a temporary breakdown of communication between the two countries.
• India rejected the updated map of Nepal stating that the map is not based on historical facts and evidence.
• The move was described by the Ministry of External Affairs as “artificial”, “unilateral” and “unacceptable”. India had also asked Nepal to return to dialogue.

Indian territories on the currency notes of Nepal:

• The Government of Nepal has decided to come out with a Rs-100 currency note that depicts the country’s map with areas such as Lipulekh, Kalapani and Limpiyadhura which are under Indian control.
• The decision on the new currency note, was taken at a meeting of the cabinet chaired by Prime Minister Pushpa Kamal Dahal ‘Prachanda’.
• Nepal’s decision drew a sharp response from India with External Affairs Minister S Jaishankar saying that Nepal’s move will not change the situation or the reality on the ground.
• The cabinet decision will be sent to the Rastra Bank, Nepal’s central bank, which may take up to a year to get the new note printed.
• The central bank will have to come out with tenders for printing quality notes.
• This decision of the Nepal Government has not received full support from the local political stakeholders.
  • Some former diplomats and former Governors of the Nepal central bank have called it “unwise” and “provocative”.

Way Forward:

• Given the historical and cultural ties that both India and Nepal share, India must not delay in resolving this matter.
• With already ongoing border dispute that India has with China in the Ladakh region, India must put an end to the dispute with Nepal by means of dialogue at the earliest.
• Since free movement of people is permitted between the two countries, Nepal holds immense strategic relevance to India. India holds around 6 to 8 million strong Nepali diaspora which is one of the largest contributors to Nepal’s economy.
• Hence, it is in the best of the interests for both the countries to resolve the boundary dispute at the political level only.