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Nepal’s Rs-100 Currency Note to Feature Map Controversy


The Government of Nepal has announced plans to introduce a new Rs-100 currency note featuring the country’s map, including territories claimed by India. This move is likely to fuel tensions between the two neighboring countries, which have long-standing border disputes.


GS II: International Relations

Dimensions of the Article:

  1. Nepal’s Introduction of New Currency Note with Disputed Territories
  2. Historical Background
  3. Recent Dispute Between the Two Countries
  4. Way Forward

Nepal’s Introduction of New Currency Note with Disputed Territories

  • Nepal’s government has decided to unveil a new Rs-100 currency note featuring a map incorporating areas contested by India, including Lipulekh, Kalapani, and Limpiyadhura.
  • This move, authorized during a cabinet meeting chaired by Prime Minister Pushpa Kamal Dahal ‘Prachanda,’ has drawn a firm response from India, with External Affairs Minister S Jaishankar asserting that Nepal’s action wouldn’t alter the current situation.
  • Approval from Rastra Bank, Nepal’s central bank, is awaited for the decision, which may take approximately a year for the note’s production. Subsequently, the central bank will initiate the tendering process to ensure the printing of high-quality notes.
  • However, the decision has faced internal opposition, with certain former diplomats and central bank governors deeming it “unwise” and “provocative.”

Following Nepal’s release of an updated political map in May 2020, which laid territorial claims over Kalapani, Limpiyadhura, and Lipulekh, tensions between India and Nepal heightened. The Kalapani region, named after the Kali River (known as Mahakali in Nepal), serves as a natural border between the two nations. Disputes over the river’s origin, with India asserting it originates in Pithoragarh, Uttarakhand, and Nepal claiming it starts from either Limpiyadhura or Lipulekh, have been a persistent issue.

Historical Background:

  • The Treaty of Sagauli (1816) between the British East India Company and Nepal delineated the Kali River as Nepal’s western boundary with India.
  • However, it omitted mention of the ridgeline, leading British surveyors to depict varying sources of the Kali River on subsequent maps.
  • This discrepancy has fueled boundary disputes between India and Nepal, with Nepal officially raising the issue of Kalapani for the first time in 1998.

Recent Dispute Between the Two Countries:

  • In 2020, Indian Defence Minister Shri Rajnath Singh inaugurated a new road linking India to China via the Lipulekh pass to expedite pilgrim travel to Kailash Mansarovar.
  • Nepal strongly protested this action, asserting it breached a 2014 agreement between the Prime Ministers of India and Nepal to address outstanding boundary issues in Kalapani and Susta.
  • In response, Nepal’s parliament passed a Constitutional Amendment Bill to endorse the updated map incorporating Kalapani, Lipulekh, and Limpiyadhura, leading to a breakdown in communication between the two nations.
  • India rejected Nepal’s revised map, deeming it devoid of historical substantiation and unilateral in nature, urging Nepal to return to dialogue.

Way Forward:

  • Given the deep-rooted historical and cultural ties between India and Nepal, India must promptly address this matter.
  • Amidst the ongoing border dispute with China in Ladakh, resolving the issue with Nepal through dialogue is imperative.
  • Nepal holds strategic importance for India due to the free movement of people between the two nations and the significant Nepali diaspora in India, which substantially contributes to Nepal’s economy.
  • Therefore, a political resolution of the boundary dispute is in the best interest of both countries.

-Source: The Hindu

May 2024