Kathmandu: India Sunday announced $1-billion line of credit to Nepal as Prime Minister Narendra Modi embarked on a two-day official visit to the Himalayan nation.
The Indian line of credit will be spent for mutually agreed projects like road and hydro electricity projects, according to Nepal's Finance Minister Ram Sharan Mahat.
During bilateral talks between Nepali and Indian delegates at the Prime Minister's Office in Nepal Sunday afternoon, the visiting Indian prime pinister offered this assistance to Nepal.
"The Indian prime minister offered the line of credit which we happily accepted," said Mahat after the meeting. Officials from both sides will sit later and reach an understanding on details like finalising interest rates and projects.
At present, the Indian line of credit to Nepal stands at $350 million which started in 2006. The Indian line of credit has been used for various infrastructure projects like road expansion and construction of transmission lines.
"The government of India announced a soft credit line of $1 billion to be used in infrastructure development and energy projects as identified by the government of Nepal and to increase the number of scholarship to Nepalese students," said a statement issued here by the Nepali side.
The two prime ministers affixed the first cancellation mark on the commemorative first day cover issued by the Nepal Philatelic Bureau marking the visit of Modi.