Modi announces $1bn of credit for Nepal infrastructure

Narendra Modi, the recently elected prime minister of India, has offered a $1bn soft loan to Nepal while visiting the country. The money is to be spent on infrastructure and hydropower development.

Modi said: "This amount is separate from the previous assistance that India has already provided to Nepal. I want to double the amount of electricity India is providing Nepal today so we have to lay the transmission lines as soon as possible."

This is our bonding– Narendra Modi

Part of the loan would also help develop Nepalese technology. Modi said: "Nepal should not be left behind among the nations of the world. Nepal too has to catch up with the digital age and it has to be connected to the world at large."

The loan is to be provided by the Indian Export Import Bank, and follows the granting of a $250m concessional loan in 2011.

Modi is the first Indian prime minister to visit Nepal in 17 years.

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