Nepal-India open border advantages and challenges 1

"Nepal-India open border advantages and challenges"

A term-paper submitted to:

Tejman Shrestha
MIRD TU

Submitted by:
Bigyan Bhandari
MIRD 2nd Semester, Roll no 21
 Nepal-India open border advantages and challenges 2

Abstract
This paper explores the history of India-Nepal border as well as the historical origins of open
border between Nepal and India. It deals with the social, cultural and economic importance of
open border in the lives of Nepali and Indian citizens. This paper argues that open border has
contributed to foster a feeling of connectedness and goodwill among the citizens of Nepal and
India, provided economic benefits to either countries and had a vital role to play during Nepal's
decade long conflict and subsequent peacebuilding process. It addresses the problems that have
arisen because of the open border and argues why a closed and sealed border might not be in the
best interests of both Nepal and India. Instead, it suggests that a better regulated border along
with intergovernmental cooperation and policy cooperation is the best approach to solve border
problems between Nepal and India.
 Nepal-India open border advantages and challenges 3

Nepal-India open border advantages and challenges

History of Nepali border

Despite Nepal existing independent and separate from India since time immemorial, the proper
demarcation of Nepal-India border did not take place until after the Anglo-Nepal war of 1814-16
and the signing of Treaty of Sugauli in 1816. Before the British rule, India was divided into
many kingdoms and principalities with fluid boundary lines. The British consolidated India
through colonization and invasion and were instrumental in delimiting and demarcating the
borders of India, which contributed to the establishment of Indo-Nepal border as well. (Treaty of
Sugauli, 1816)

On the southern, eastern and western territories, Nepal shares its borders with India. The Treaty
of Sugauli limited Nepal's eastern boundary at the Mechi river and the western boundary at the
Mahakali river with Nepal having to cede its territories beyond these boundaries, as well as
claims of territories disputed in the southern border between the rivers Rapti and Mahakali.
(Article 3, Treaty of Sugauli, 1816) However, there was no such clear demarcation of the
boundary in the southern plains. The dense forest might have been seen as a physical boundary
between Nepal and British India. Even a subsequent treaty of 1860 which returned back to Nepal
some land previously ceded by Nepal in 1816 presents no attempts at proper demarcation of the
boundary (Boundary Treaty, 1860).

The demarcation of Nepal-India border was done by the Survey of India 1926-27, which also
conducted a topographical survey of Nepal. It included the information about the location and
number of each boundary pillar between Nepal and India. Further, in 1955, a second survey
provided more detailed study of the border and produced a map that included the border line and
border pillar locations and numbers. However, the territorial details of the Indian side were left
blank – this map did not list landmarks and man-made features that help resolved border issues
that could arise in the future. As topographical details change over time, and as such are not a
reliable method of demarcating a border, the non-inclusion of landmarks and man-made features
have resulted in frequent border disputes between Nepal and India. There has been a provision
for India-Nepal Joint Boundary Commission since 1981 that meets twice a year to resolve any
border issues. It has found 8 areas of disputes along the almost 1800km long borders whereas
 Nepal-India open border advantages and challenges 4

Nepali border expert Buddhi Narayan Shrestha has claimed there are more than 54 disputed areas
along the Nepal and India and that India has encroached 606sq Km area of Nepali land
(Shrestha, 2000).

Nepal-India open border and immigration

Historically Nepal-India border had been open and unrestricted movement occurred along the
border until the treaty of 1816. Nepali history texts mention that the rulers of Kathmandu, the
Gopals, the Lichhavis, the Mallas and the Shahs immigrated to Kathmandu from various Indian
kingdoms over a period of time. The Terai region was uninhabitable due to dense forests and
widespread malaria, and hence there was rarely any settlement in this region. However, there
was a frequent movement of traders and pilgrims across the Terai belt. The British-India too
continued the tradition of open border and unrestricted movement across the border principally
to allow for recruiting of soldiers from Nepal as well as to carry out trade with Tibet via Nepal.

When Chandra Shamsher initiated the process of clearing the forests in Terai to meet the
demands for agricultural lands in the country in the aftermath of the abolishment of slavery in
Nepal, the Hill people were reluctant to move to Terai owing to the fear of Malaria and the heat.
As such, the program actually attracted immigrants from India to settle in these lands. Further,
newly established industries in Biratnagar, Birgunj and other southern cities created a demand
for the manpower which was met by immigrants from India as people from Hilly region of Nepal
preferred to emigrate to India and abroad for employment opportunities instead (Kansakar,
2001).

The Treaty of 1950 and its impact on Nepal-India Border

The Nepal-India Peace and Friendship Treaty signed on 1950 granted, on a reciprocal basis,
privileges to nationals on one state residing in another in matters of residence, owning of
property, trade and commerce, and movements across the border (Article 7, Treaty of Peace and
 Nepal-India open border advantages and challenges 5

Friendship, 1950). This openness of Nepal-India border is unique in the world. Except for
designated 22 trade points, the movement across the border in unregulated. People from each
country can cross the international border from any point along the 1400km long border, no
records of any sort are kept to track the movement of people across the border.

This provision of unregulated border after the treaty of 1950, particularly after the introduction
of democratic government in Nepal was in a marked contrast to the practice before the treaty,
when Rahadani (visa) had to be issued for any Nepali willing to travel to India or returning from
India to Nepal (Rahadani Act, 1952). Further, after the 1950 treaty, citizens from either country
could buy properties in another country which had not been possible in earlier times.

Open and unregulated border and the problems it creates

When the Panchayat government introduced Land Reform Act in 1964, it aimed at making a
more equitable distribution of land through imposing of ceiling on land ownerships as well as
conferring permanent tenancy rights to the tenants who tilled these lands (Lands Act, Preamble,
1964). In response to the proposed reform, the landlords sought to avoid losing their lands by
taking advantage of the open border system and the loophole in the Land Reform Act. As the
migrant laborers were not eligible for tenancy rights, the landlords dislodged the tenants from
their lands and employed the migrant laborers from India to till their lands. This has had a two-
fold effect on the citizenship issue in Nepal, the repercussions of which are being felt even to this
date. On the one hand, the tenants who were dislodged became landless with no property in their
name. They could not apply for or receive citizenship certificate – which deprived them of all
government benefits a Nepali citizen is entitled to receive. On the other hand, it has been alleged
that Indian immigrants have been able to procure Nepali citizenship by means of false
declaration, bribery, and undue political influence.

Similarly, open border between Nepal and India is also responsible for the Bhutanese refugee
crisis that Nepal faced from 1990 onwards. When the Lhotsampas, people thought to be of
Nepalese origin, were driven out of Bhutan, India, being the immediate neighbor and sharing the
borders with Bhutan, would have been responsible for providing asylum for these refugees.
 Nepal-India open border advantages and challenges 6

Instead, open border system allowed Indian to drive these refugees into Nepali territory
(Ghimire, 2007).

Human trafficking along the border from Nepal to India has been a matter of concern for a long
time now. UNICEF estimates show that 29000 Nepali women and girls are trafficked to India
every year who are then sold into slavery and brothels. Tourists from India visit Nepal to
sexually exploit minors, sometimes even bringing them across the border (UNICEF, 2012).

As cross border movement is not recorded, it is very hard to get an exact data on human
trafficking. It is widely believed that labor recruitment agencies have been trafficking Nepali
manpower to work in conflict prone areas of Syria, Iraq and Afghanistan that have been banned
for foreign employment by Nepal via the route of India. There have been reports that Nepali
women are trafficked through the similar channels to be sold as domestic workers or sex slaves
in countries as diverse as Kenya, Syria, Libya among others (Pattison, 2016).

In addition to these, unregulated border between Nepal and India has been identified as the core
cause for smuggling of goods, narcotics and arms across the border which has led to increased
criminal activities in the border towns. Kidnapping, racketeering, terrorist movements have
pestered the border areas for a long time. It was widely believed that Nepalese Maoist terrorists
as well as Indian Naxalites exploited the open border system to conduct their activities from
across the Nepal-India border.

Similarly, the difference in tariff rates in Nepal and India has created loopholes for the
businesses that smuggle goods across the border to avoid paying high tariff rates. Because of
difference in Indian and Nepalese policies in regards to importing goods from third countries
(India discourages it and slaps high tariff rates on such goods, whereas Nepal, owing to the fact
that it is still not an industrialized nation, does not have high tariff rates on such goods.), Indian
businessmen have been importing goods into Nepal for cheaper tariff and smuggling them across
the open border into the Indian market where the demands for such goods in high. Similarly,
Nepalese businesses have also been importing goods such as carpets and threads from India,
which they then relabel as Nepali product and export them to third countries where they receive
concessions in tariff rates owing to the status of Nepal as a less developed nation. These
activities are clearly hurting the economies and industries of both Nepal and India. Turkey has
recently warned against such practices by Nepali businesses to re-label Indian product as Nepali
 Nepal-India open border advantages and challenges 7

product and threatened to revoke tariff concessions received by Nepali products (Neupane,
2018).

Potential advantages of the open border for Nepal

India is a poster child for the success of economic liberalization. Before India's economic
liberalization of the 1992, the GDP, adjusted for Purchasing Power Parity (PPP), per capita of
India and Nepal in 1990 were $1134 and $775 respectively. However, the data for 2017 shows
the GDP (PPP) per capita for India and Nepal to be $6570 and $2478 respectively (World Bank,
2018). This growing disparity, while worrisome, also presents an economic opportunity for
Nepal whose biggest source of GDP in the recent years has been remittance sent from abroad.
The total number of Nepalese residing in India and who work in India and send money back to
Nepal is currently not known officially. Estimates range from as high as 12 million Nepali
residing in India to 600,000 as per the official census data of 2001 (National Population Census,
2001). This discrepancy perhaps arises out of misidentification of Nepali speaking Indians from
Darjeeling, Sikkim and Assam as Nepali citizens. Nevertheless, the importance of India's relative
success in economic sector, and the opportunities it presents for Nepal, especially in terms of
affordable foreign employment, has not yet been fully realized by Nepal.

The provisions of the 1950 Treaty that grants privileges to citizens of either country in matters of
residence, owning of property, trade, commerce and employment and the existing open border –
coupled with India's ongoing as well as projected economic growth - can make India a lucrative
work destination for Nepali workforce, provided they are adequately skilled and qualified.
However, despite India still drawing the largest number of Nepalese for foreign employment,
there has not been any legal framework which aims at protecting and furthering the wellbeing of
Nepali workers in India. Neither has been there any study done or policy implemented so as to
maximize the benefits of Indian foreign employment to Nepal. This disregard shown to
safeguard the rights of Nepali workers in India has rendered them vulnerable and they cannot
enjoy the labor rights and job securities accorded to the workers by Indian government.

It also needs to be noted that India is still a primary destination for low skill workers and
seasonal agriculture workers of Nepal for whom foreign employment in Gulf countries and
Malaysia is cost prohibitive. When taken into consideration the fact that the workers who
migrate to India to work are among the poorest people in Nepal, India's role as the foreign
 Nepal-India open border advantages and challenges 8

employment destination for Nepalese gains new significance and even if the income levels from
foreign employment in India are not significant as from other nations, even this smallest of
increases in income can make a huge difference in the general welfare of these poor workers
from Nepal.

Open border has also facilitated a socioeconomic and religious interconnection between the
inhabitants of two countries in the border areas. This has fostered friendly relations, mutual
understanding, and cultural ties and in general, strengthened the friendship and goodwill between
the two countries. In this context, Nepal-India border promotes friendship and freedom over
restriction and suspicion. The inhabitants across each other share a common language, culture
and tradition. Their food habits, dress and way of living are almost the same. Marriages across
the border are common and as such, open border has helped promote and preserve the unique
cultures and traditions of Maithili, Bhojpuri and Awadhi cultures. It can even be argued that this
freedom is responsible for peace and goodwill that is seen across Nepal-India border which is not
seen in India-Bangladesh or India-Pakistan borders.

On a greater scale, open border has promoted religious tourism, as well as providing better
health, and education access to citizens of either countries. Every year, eye hospitals across the
Terai region of Nepal serve more Indian citizens than Nepali whereas Nepalese travel to different
cities of India for better health and education facilities (More Indian nationals visiting
Biratnagar eye hospitals for treatment. The Himalayan Times. October 18, 2017). Because of
the provision of national treatment to the citizens of one country into the territory of another,
people from India as well as Nepal do not have to pay extra charges to avail of these facilities.

Similarly, Nepalese made use of the open border with India during the decade-long civil war to
escape from the atrocities at home. During the peak of civil war in 2002/3, it was estimated that
almost 2000 Nepali citizens migrated to India every day in order to protect their lives and to seek
livelihood (Jha, 2003). Open border helped lower the impact of the devastating civil war. In the
absence of open border, the migration of people seeking to avoid the war would have turned into
a refugee crisis between Nepal and India, or the internal displacement of such people within the
territories of Nepal would have more severe repercussions on the socioeconomic and cultural
fabric of Nepali society as well as caused a greater humanitarian crisis. Such humanitarian crisis
 Nepal-India open border advantages and challenges 9

would have impacted even the peacebuilding process in Nepal that went smoothly after the war
ended in 2006.

Conclusion: Future challenges and opportunities from open border

India has always been wary of threats to its national security since its independence. Times and
again, India has shown displeasure at the supposed infiltration of Pakistani terrorists, fake Indian
currencies and narcotics into India through Nepalese territory (Counterfeit currency smuggling
rises on porous Nepal border. Times of India, March 3, 2015). Similarly, Nepal has also
recognized the issue of illegal smuggling and cross border trafficking of goods, arms, and
criminals into Nepal through India (Nepal India agree to strengthen border security. Business
Standard. February 11, 2015). In response to these problems, there has been an increased
presence of Indian security forces in the Nepal-India border. However, the local inhabitants have
actually been accusing these security forces of either countries of harassing civilians and small
traders along the border. They have also been accused of misusing their authority and accepting
bribes to continue allowing for the smuggling of goods across the border. Indian security forces
have also been accused of entering into Nepali territory illegally, acting outside of their
jurisdiction, and even the extrajudicial killing of Nepali citizens (Nepali killed as Indian border
security personnel open fire. The Himalayan Times, March 09, 2017).

In response to these problems, there have been calls for closing of Nepal-India border and tighter
restrictions on crossing the border. It cannot be denied that open border has facilitated
smuggling, trafficking and criminal activities across the border. However, Nepal and India also
have to learn from the India-Bangladesh and India-Pakistan border disputes that closed border is
not a pragmatic solution when people across borders have social, cultural, and religious
connections. In fact, closed border might lead to escalation of these problems to a full-fledged
conflict and warfare between the countries as evidenced by India's experiences in Bangladesh
border. In light of recent ethnic troubles in Nepal, particularly among the inhabitants of Terai
region, a closed border would only serve to escalate the problem and create a sense of restriction
 Nepal-India open border advantages and challenges 10

and alienation in the people of Terai. This could have severe repercussions to the process of
nation-building as well as to the integrity and unity of Nepal.

One cannot help but interpret Indian accusations of open border facilitating anti-Indian activities
as general suspicion and distrust towards Nepal's ability to curb such activities within Nepali
territory. There have been some evidences and proofs of such anti-Indian activities but none of
the attacks on Indian soil have been conducted by terrorists entering into India through the
Nepal-India border. Even so, Nepal, as a good neighbor of India, should not fail to properly
address Indian concerns and assure them of being capable of controlling any such activities in a
spirit of mutual respect and understanding.

Open border benefits both countries greatly and is vital to the economic, social and cultural
wellbeing of the inhabitants near border areas as seen above. As such, keeping the border open is
in the best interests of both countries. Both countries could work together to regulate the flow of
goods and people along the border, along with a practice of keeping records of the movement of
people across the border. The problem of smuggling and trafficking of arms and narcotics cannot
simply be solved by a sealed border. It is logistically and financially not viable to have presence
of armed forces all along the border to prevent these practices completely. The best solution to
this problem is to work together and exchange relevant information between Nepalese and Indian
authority to curb any illegal activities across the border along with taking measures to tackle
corruption and misuse of authority that plagues the security and border personnel in the either
side of Nepal-India border. Further, having a uniform tariff rate and other policy measures to
close any legal loopholes is also an effective way to discourage the practice of smuggling across
the border. All these measures are more cost effective and in the spirit of mutual understanding
than taking an extreme measure of sealing the border.

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Boundary Treaty. British Government-State of Nepal. 1 November 1860.
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http://archive.nepalitimes.com/news.php?id=13592 on 01/26/2019.
 Nepal-India open border advantages and challenges 11

Jha, H. B. (2013) Nepal's border relations with India and China. Eurasia Border Review. Vol 4
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