On the morning of the day of 1st April 1990, when Nepal was considered at the extreme stage of revolution led by Nepali Congress for the demand of multi-party system, the then Indian foreign secretary S. K. Singh came to Nepal as a special envoy and presented the following agreement to King Birendra. The King out rightly rejected the proposed agreements and declared multiparty system on the same evening, saying that it was better to make citizen sovereign than to handover to an alien nation.
[The rejection of the proposed treaty caused an irreparable loss to the nation to the extent that the beloved monarch some years later was brutally murdered and what followed thereafter is there for all to see-Ed]
The proposed full text was as below:
SECRET AGREEMENT BETWEEN THE GOVERNMENT OF INDIA AND HIS MAJESTY’S GOVERNMENT OF NEPAL ON MUTUAL COOPERATION
The Government of India and His Majesty’s Government of Nepal (hereinafter also referred to as the Contracting Parties), Recalling the unique, age-old and traditional friendship between the peoples of India and Nepal based on the bonds of history, geography and of shared social and cultural values, Reaffirming their adherence to the Treaty of Peace and Friendship between the Governments of India and Nepal of 1950, which has ever since been and remains the cornerstone of Indo-Nepal relations, Keen to sustain and further strengthen the bonds of friendship, good neighbourliness and mutually beneficial cooperation between the two countries and peoples, Determine to strengthen economic cooperation between them. Desiring to develop their economics in their own and common interest.
Convinced of the benefits of mutual sharing of scientific and technical knowledge and experience to promote trade between them, have agreed as follows:
TREATMENT OF EACH OTHER’S NATIONALS IN THEIR RESPECTIVE TERRITORIES:
Subject to such exceptions as may be mutually agreed upon, the Contracting Parties undertake not to enact and to repeal any laws, rules, regulations, and Government orders which restrict the rights and privilege of the nationals of one Contracting Party in the territory of the other in matters of residence, ownership of property, employment, participation in trade and commerce, movement, participation in industrial and economic development of such territory and the grant of concessions and contracts relating to such development and other privileges of a similar nature as enjoined by the Treaty of Peace and Friendship between the Government of India and the Government of Nepal of 1950 and the Letters exchanged along with the Treaty.
Each Contracting party shall have the freedom to bring to the notice of the other any laws, rules, regulations, and Government orders of the other Contracting Party which may restrict such rights and privileges of its nationals in the territory of the other.
In the interest of strengthening their defence capabilities, the Contracting Parties have agreed to cooperate with each other in the military field. To this end, His Majesty’s Government of Nepal shall consult and enter into suitable Protocols with the Government of India concerning the acquisition by Nepal of arms, ammunition and other materials and equipment necessary for the security of Nepal.
Such cooperation between the Contracting Parties in the military field shall include assistance by the Government of India by providing arms ammunition, other materials and equipment and in coordinating training for the raising of additional formations and units for the Royal Nepali Army, on the basis of the details to be mutually determined by the representatives of the Contracting Parties.
The cooperation between the Contracting Parties in the military field shall also include cooperation in the training of Nepali Armed Forces personnel.
The Contracting Parties undertake not to enter into any military alliance with any other State against each other. His Majesty’s Government of Nepal, in this respect, agree mentioned in Articles I to III above with any other State or organization without prior consultations and agreement with the Government of India.
The arrangements envisaged in Articles I to IV above shall have no bearing on the independent foreign policy of either Contracting Party.
(Agreed Articles on Trade to be included in this Part)
(Agreed Articles on Transit to be included in this part).
COOPERATION TO CONTROL UNAUTHORISED TRADE
(Agreed Articles on Cooperation to control Unauthorized Trade to be included in this Part).
ECONOMIC INDUSTRIAL AND WATER RESOURCES COOPERATION:
In the traditional spirit of friendly cooperation between India and Nepal and for the benefit and welfare of the people of Nepal, the Government of India undertake to provide, at the request of His Majesty’s Government of Nepal, such developmental assistance as may be mutually determined by the Contracting Parties from time to time.
Should His Majesty’s Government of Nepal decide to seek foreign assistance for the development of the natural resources of Nepal or for any industrial project in Nepal, they shall give first preference to the Government or the nationals of India, as the case may be, provided that the terms offered by the Government of India or Indian nationals as the case may be, are not less favourable to Nepal than the terms offered by any other State or its nationals or by any international organization or agency.
The two Contracting Parties being equally desirous of attaining complete and satisfactory utilization of the waters of the commonly shared rivers, undertake to (I) plan new uses or projects subjects to the protection of the existing uses on the rivers and (ii) cooperate with each other to formulate and modify the planned new uses or projects taking into consideration the water requirements of the parties.
The Contracting Parties agree jointly to plan, construct and manage projects of mutual benefit. In this regard, the involvement of a third party, where felt to be necessary and in the common interest, shall be subject to mutual consent.
To facilitate the effective and harmonious implementation of this Agreement, the Contracting Parties shall consult each other regularly, and review the implementation of this Agreement, within the forum of India-Nepal Joint Commission. They shall meet for this purpose at least once in twelve months.
For the purpose of this Agreement, the various parts specified therein are inter-related and shall be considered as a whole.
Part I of this Agreement shall remain in force for the same duration of time for which the Treaty of Peace and Friendship between the government of India and the government of Nepal of 1950 shall be in force.
Part II of the Agreement shall remain in force for a period of ten years and it may be renewed for further periods of ten years by mutual consent, subject to such modifications as may be agreed upon.
Part Ill of the Agreement shall remain in force for a period of ___years and it may be renewed for further periods of ___ years by mutual consent, subject to such modifications as may be agreed upon.
Part IV of the Agreement shall remain in force for a period of ___ years and it may be renewed for further periods of__ years by mutual consent, subject to such modifications as may be agreed upon.
Part V of the Agreement shall remain in force for a period of___ years and it may be renewed for further periods of__ years by mutual consent, subject to such, modifications as may be agreed upon.
Part VI of the Agreement shall remain in force for a period of__ years and it may be renewed for further periods of -----years by mutual consent, subject to such modifications as may be agreed upon.
This Agreement shall come into force on__ 1950 and remain valid for the same duration of time for which the Treaty of Peace and Friendship between the Government of India and the Government of Nepal of 1950 shall be in force.
Done at Kathmandu on__ day of__ One Thousand Nine Hundred and Ninety in two originals each in Hindi, Nepali and English languages all of them being equally authentic. In case of doubt the English text shall prevail.
For His Majesty’s Government of NEPAL For the Government of INDIA
(Text Courtesy Water Politics on Nepal’s Fresh Water by Dr. Shastra Dutta Pant Pg 188 to 194)