India and Nepal Strengthen Energy Partnership with B2B Deal Including Oil Pipelines

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India and Nepal Strengthen Energy Partnership with B2B Deal Including Oil Pipelines

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Flags of India and Nepal (© Adobe Stock/luzitanija)
Flags of India and Nepal (© Adobe Stock/luzitanija)

India and Nepal have taken a significant step towards strengthening their energy partnership by signing a Business-to-Business (B2B) Framework Agreement, which includes plans for several pipeline projects aimed at enhancing petroleum infrastructure in Nepal.

The agreement, inked on October 3, 2024, is a direct result of a Government-to-Government (G2G) Memorandum of Understanding signed in May 2023. 

The B2B agreement builds upon this foundation by outlining specific initiatives to optimize the transportation of petroleum products from India to Nepal.

Key projects under the agreement include the construction of a 50-km Siliguri to Charali Pipeline to facilitate the efficient transportation of petroleum products from India to Nepal. 

To enhance storage and distribution capabilities, the projects will also include the construction of a state-of-the-art Terminal Smart Greenfield at Charali and another one at Lothar with a storage capacity of 91, 900 kilometers. 

As part of the agreement, the Indian government will provide a grant to support the development of a 62-kilometer pipeline running from Amlekhgunj to Lothar. 

The development of these pipelines and storage facilities is expected to create opportunities for further economic integration and benefit both nations by reducing Nepal's transportation costs and granting India a reliable cross-border energy trade partner.