Thaindian News

Kathmandu/New Delhi, Oct 19 (IANS) With his Maoist party asking him to stay away from signing crucial pacts, Nepalese Prime Minister Baburam Bhattarai is planning to focus on expanding economic ties with India and seeking a $1 billion soft loan for a host of developmental projects in his country.

India is expected to push for consensus to spur an inclusive peace process and drafting of a new constitution during Bhattarai’s four-day visit here that begins Thursday.

Significantly, Bhattarai comes here on his first bilateral visit abroad and his first official visit to India after taking charge as Nepal’s prime minister less than two months ago, showing a keen desire on part of Nepal’s Maoists to build better relations with New Delhi.

Prime Minister Manmohan Singh will hold talks with Bhattarai Friday on a wide array of issues ranging from economic and energy ties to security cooperation and infrastructure projects.

Sources in Kathmandu said Bhattarai will focus on building political trust and expanding economic and security cooperation with India. He is expected to ask for $1 billion soft loan for a host of infrastructure projects. New Delhi is willing to extend a credit line, but the amount is still under discussion, said well-placed sources in New Delhi.

The credit line is expected to to be channelised through the EXIM bank for a swathe of infrastructure projects, including roads and irrigation. India’s development assistance to Nepal is currently estimated at about $100 million.

Bhattarai is expected to brief New Delhi about recent political developments and seek its support in reinvigorating the peace process in his country that continues to be riven with political dissensions.

Kathmandu feels that India can use its leverage with all political parties and formations in Nepal to push forward the peace process. The integration and rehabilitation of the Maoist cadre continues to divide the Maoists and the Nepal Congress. With the blame game showing no sign of ending, the Nov 30 deadline for framing the constitution is set to be extended.

Deals for easing power crunch and infrastructure building are expected to be cleared, but no pact with long-term consequence like the long-pending extradition treaty will be signed.

Scaling up trade and investment and developmental cooperation will figure prominently in the talks.

India is also expected to press Nepal for a bilateral investment protection agreement, an issue that has acquired an added importance since the attack on 900 MW Upper Karnali hydropower project an Indian company has been building in Nepal by suspected Maoist cadres a few months ago.

Bhattarai has promised to guarantee the security of Indian investment in his country, but there is no clarity on whether he will agree to a clause proposed by India that provides for compensation to Indian companies in case of a riot or insurrection.

With Nepal suffering from a crippling power crunch, Bhattarai is set to request India for an additional 200 MW that will provide relief from the burden of frequent cuts that sometimes last for nearly 18 hours.

The ruling United Communist Party of Nepal (Maoist) has asked Bhattarai not to sign any new treaty or agreement, and not to discuss any contentious issues during his goodwill visit. The party standing committee, chaired by chairman Prachanda, directed Bhattarai to focus primarily on building “good-will” and exploring possibilities of improving ties with New Delhi.

India is keen to formalise the revised draft of the extradition treaty of 1953 along with the mutual legal assistance agreement. New Delhi also wants Kathamndu to clear its long-standing demand for deploying sky-marshal in Indian aircraft operating to and from Nepal.

Bhattarai is also likely to take up the issue of the cases against his party cadres and leaders in cities like Patna, Muzaffarpur and Gorakhpur.