On 28 January 1991, Nepal and India signed their first Bilateral Investment Promotion and Protection Agreement (BIPPA) in New Delhi. The agreement marked a new era in the relationship between the two countries and opened the doors for investment and business opportunities.
The BIPPA aimed to promote and protect investment between Nepal and India, and to provide a framework for resolving disputes that may arise. The agreement provided for national treatment and most-favored-nation treatment to investors of each country, ensuring that they are treated equally and have the same rights and privileges as domestic investors.
Additionally, the BIPPA established a mechanism for the settlement of disputes between investors and the host government. This mechanism allowed for disputes to be resolved through negotiation or arbitration.
The BIPPA agreement was a significant step forward for Nepal, as it provided greater access to Indian markets for Nepalese investors and gave Nepalese businesses greater protection and legal recourse in the event of any disputes with Indian entities. It also helped to ease tensions between the two countries and provided a platform for greater cooperation in trade and investment.
Since the signing of the BIPPA, there have been several developments and amendments made to the agreement. In 2011, the BIPPA was extended for another ten years, and some of its provisions were revised to better reflect the evolving needs of the two countries’ economies.
In conclusion, the first Bilateral Investment Promotion and Protection Agreement (BIPPA) between Nepal and India was a significant milestone in the relationship between the two countries. It provided greater access to Indian markets for Nepalese investors and gave Nepalese businesses greater protection and legal recourse in the event of any disputes with Indian entities. The BIPPA has been instrumental in facilitating greater cooperation in trade and investment between Nepal and India, and it continues to be an important agreement for both countries.