India will help Nepal construct a rail link between capital Kathmandu and an Indian border town for smoother movement of passengers and cargo to the landlocked Himalayan nation, which neighbouring China is also trying to woo with a similar plan.
An agreement to study the feasibility of a rail line linking the two countries was signed by officials on Friday during a meeting between Nepal's Prime Minister K.P. Sharma Oli and Indian premier Narendra Modi on the sidelines of a regional summit of seven South and East Asian countries.
India's Konkan Railway Corporation Ltd will conduct a preliminary engineering and traffic survey for the rail line, India's embassy in Nepal said in a statement.
The planned 130 km (80.78 mile) line from the Indian border town of Raxaul in eastern Bihar state to Nepalese capital Kathmandu, once built, will just be the second rail track in the mountainous nation. Nepal's only railway link is a 35 km stretch in its southern plains.
Construction of the rail line and its funding will be finalised after the Konkan Railway submits its findings, officials said.