India-Nepal Petroleum Pipeline: First In South Asia Inaugurated

India and Nepal achieved yet another milestone in their bilateral relations when the Prime Ministers of both countries jointly inaugurated South Asia’s first ever cross border petroleum products pipeline from Motihari in Bihar state of India to Amlekhgunj in Nepal through video conference. The 69-kilometre long pipeline, which is 32.7 kilometres on the Indian side and 37.2 kilometres in Nepal has a capacity of uninterrupted supply of two million tonnes of clean petroleum products to the people of Nepal annually.

Describing this as a symbol of close bilateral relations between India and Nepal, Prime Minister Narendra Modi said the Motihari-Amlekhgunj pipeline project will help enhance energy security of the region and substantially cut down on transit costs. He noted with satisfaction that regular exchanges at the highest political level have laid down a forward looking agenda for expanding India-Nepal partnership. Inaugurating the project from New Delhi, Mr. Modi expressed confidence that bilateral relations between the two countries will continue to further deepen and expand across diverse sectors and reiterated India’s commitment to help the Himalayan nation in its development effort.

In his address on the occasion in Kathmandu, Nepal’s Prime Minister K.P. Sharma Oli described the pipeline project as one of the best examples of connectivity in terms of trade, transit and infrastructure. He said, backed by solid political commitment, India and Nepal have similar vision of development, prosperity and happiness of their peoples and both have a strong determination to realise it. As a big relief to the people of Nepal, Mr. Oli announced two rupees per litre cut in the price of petrol and diesel in Nepal. He said the oil supplies through the pipeline from India to Nepal would not only reduce cost and save time but also lessen road traffic and reduce air pollution created by tankers transporting petroleum products.

Nepal imports its entire requirement of oil products from India since 1973 and traditionally oil tankers are being used to transport oil products. The Public Sector, Indian Oil Corporation, the nodal agency for the supplies from its Barauni refinery and Raxaul Depot in Bihar had renewed the agreement with Nepal Oil Corporation in 2017 to continue oil supplies for another five years till 2022.

Proposed for the first time in 1996, the Motihari-Amlekhgunj pipeline project remained in cold storage for a number of years. It gained momentum after Prime Minister Modi’s visit to Nepal in 2014. An agreement to undertake the project was signed between the premier public sector oil companies of the two countries, the Indian Oil Corporation Limited and the Nepal Oil Corporation in September 2015. The foundation stone for the project was laid through remote control by the Prime Ministers of the two countries Mr. Modi and Mr. Oli from Hyderabad House in New Delhi during Mr. Oli’s visit to New Delhi in April last year.

The project was mandated to be completed in 30 months but with tireless efforts of officials on both sides, the target was achieved in about half the time originally envisaged, which was a record fast track achievement for any Indian project in Nepal. This has helped in removing the often-repeated argument against India aided projects in Nepal that their implementation is delayed in many cases leading to overruns and cost escalation. The two countries now regularly hold high level meetings to review ongoing projects. Only last month, India-Nepal Joint Commission meeting was held in Kathmandu chaired by Foreign Ministers of the two countries which reviewed the whole gamut of their bilateral relations, identified new areas of cooperation and reviewed the progress of implementation of the ongoing projects. Both Prime Ministers expressed satisfaction in the progress of their bilateral relations. Mr. Oli also thanked India for the construction of 50,000 houses for the 2015 earthquake affected people in Nepal.

Script: Rattan Saldi, Political Commentator