NEPAL-AUSTRALIA RELATIONS

Political Relations

Diplomatic relations between Nepal and Australia were established on February 15, 1960. Both countries celebrated 60 years of diplomatic relations in 2020. Australia opened its residential Embassy in Kathmandu at the level of chargé d"Affaires in 1984 which was upgraded to the Ambassadorial level in 1986. Nepal established its residential Embassy in Canberra in March 2007 which was formally inaugurated in September 2007.

Nepal"s relationship with Australia predates the establishment of diplomatic links in 1960. Over the years, the Australian Government and private sector have contributed to the economic and social development of Nepal through assistance in the fields of health, education, hydroelectricity, sustainable management of forest, agriculture, strengthening governance and service delivery, civil aviation, and livestock management.

Nepal -Australia Parliamentary Friendship Group currently co-chaired by Mr. Peter Khalil MP (Australian Labour Party) and Senator Andrew Bragg (Liberal Party of Australia) formed in February 2023 is active and has been supporting Nepal"s interest in Australian Parliament. The Group was first formed in the Australian Parliament in 2009. Similarly, in the Parliament of Nepal, Nepal-Australia Parliamentary Friendship Group has been formed on 3 October 2023. The group is chaired by Nepali Congress leader Hon Gagan Kumar Thapa.

Exchange of visits

The exchanges of visits at various levels have helped significantly in consolidating the relations between Nepal and Australia.

From Nepali Side

• Foreign Minister Hon"ble Narayan Prakash Saud visited Australia from 8-13 February 2024 to participate in the Indian Ocean Conference. He also held bilateral meeting with Senator the Hon. Penny Wong, Minister for Foreign Affairs of Australia at Perth, Australia on 9 February 2024.
• Hon. Ganesh Prasad Timilsina, Chairperson of the National Assembly of Nepal, leading high-level parliamentary delegation, visited Australia from 27 to 2 December 2023.
• Madhav Kumar Nepal, former Prime Minister (current member of parliament) was on an unofficial visit to Australia and New Zealand from 27 May to 5 June 2023 to attend programmes organized to mark 70th anniversary of the first ascent of Mt. Everest.
• Foreign Secretary Mr. Bharat Raj Paudyal, leading a delegation, visited Australia from 28 August to 2 September 2022 to participate in the second meeting of Nepal- Australia Bilateral Consultation Mechanism.
• Minister for Culture, Tourism and Civil Aviation Mr. Yogesh Bhattarai visited Australia in January 2020 for promotion of Visit Nepal 2020 in Australia.
• Deputy Prime Minister and Minister for Education Mr. Gopal Man Shrestha visited Australia from 15 to 23 July 2017 in connection with studying the functions, policies, and effectiveness of vocational training institutes in Australia.
• Minister for Energy Mr. Mahendra Bahadur Shahi visited Australia from 9 to 15 September 2017 to attend meeting and inspect water distribution system of Murray Darling river basin.
• The former Prime Minister of Nepal Dr. Babu Ram Bhattarai visited Sydney, Australia in 2017 to attend a program organized by University of Technology Sydney (UTS) and International Nepali Society, Australia.
• A delegation led by Minister for Culture, Tourism and Civil Aviation Mr. Jitendra Dev visited Canberra, Sydney and Adelaide from 27 to 30 November 2017 to participate in a tourism promotion program.
• A delegation led by State Minister for Finance Mr. Udaya Shumsher Rana visited Australia from 8 to 16 February 2018 to participate in a program organized by Association of Non-Residential Nepali.
• Minister for Foreign Affairs Dr Prakash Sharan Mahat visited Australia in November 2016.
• The Chief Justice of Nepal visited Australia to participate in 16th Conference of Chief Justice of Asia and Pacific” organized by The Law Association for Asia and Pacific from 6 to 9 November 2015.

From Australian Side

• An Australian parliamentary delegation led by the Hon. Milton Dick, MP, Speaker of the Australian House of Representatives, visited Nepal from 3 to 7 October 2023.
• Hon. Tim Watts, MP, Assistant Minister for Foreign Affairs of Australia paid an official visit to Nepal from 16 to 17 May 2023.
• Australian delegation led by Assistant Secretary Mr. Andrew Collins visited Nepal from 15 to 17 August 2018 to participate in the first Nepal- Australia Bilateral Consultation Mechanism between the Ministry of Foreign Affairs of Nepal and the Department of Foreign Affairs and Trade of Australia.
• The Governor General of the Commonwealth of Australia, His Excellency General the Honourable David Hurley AC DCS (retd) had a private visit to Nepal in 2016.
• Member of Parliament Hon. Bob McMullan visited Nepal from 25 to 27 April 2010 to celebrate the 50^th anniversary of the establishment of diplomatic relations between Nepal and Australia.
• Foreign Minister of Australia Bill Hayden visited Nepal in May 1985.
• Australia"s Governor General John Kerr visited Nepal in 1975 to attend the Coronation Ceremony of King Birendra.

Bilateral Consultation Mechanism

Nepal and Australia signed an MoU on establishing a Bilateral Consultation Mechanism between the Ministry of Foreign Affairs of Nepal and the Department of Foreign Affairs and Trade of Australia on 14 July 2017 in Canberra, Australia. Foreign Secretary Mr. Shanker Das Bairagi and H.E. Mr. Gary Quinlan, Acting Secretary, Department of Foreign Affairs and Trade, Australia signed the MoU on behalf of their respective Governments. The BCM envisages further strengthening the bilateral relations between the two countries and exploring potential areas of cooperation through regular consultation. Its first meeting was held in Kathmandu on 15-17 August 2018. The second meeting of the Nepal- Australia Bilateral Consultation Mechanism was held on 30 August 2022 in Canberra, Australia. The establishment of the Consultation Mechanism has opened the avenue to regularly hold meetings and exchanges on bilateral, regional and international issues of mutual importance between Nepal and Australia.

Aid and its Mechanism

Earlier, the Australian Government"s aid used to be mobilized by Australian Agency for International Development (AusAID). With effect from 1 November 2013, AusAID, an independent statutory agency responsible for managing Australia"s overseas aid programme, has been formally abolished and has been made a part of the Department of Foreign Affairs and Trade (DFAT). The Prime Minister, Mr. Tony Abbott, MP, announced on 18 September 2013 that the AusAID would be integrated into the DFAT, enabling the aid and diplomatic arms of Australia"s international Policy agenda to be more closely aligned. Australia is supporting Nepal under the three pillars- health security, stability and economic recovery. Australia has shown solidarity in supporting Nepal during the difficult times of Earthquake and Covid 19 Pandemic.

Economic and Technical Cooperation

Australia"s assistance to Nepal is delivered through the Government of Nepal and in partnership with other donors and multilateral organizations. Priority areas for Australia"s development assistance to Nepal are in line with Nepal"s poverty reduction strategy and include basic education, health, livelihoods, strengthening and improving governance, peace building and human resource development. Australia has also equally contributed to human resource development through the provision of scholarships and helped to reduce the incidence of HIV through a Harm Reduction program for Injecting Drug Users (IDUs). Support has also been provided to peace building activities that address the root causes of conflict, issues of governance, poverty and discrimination.

Currently, Australia is assisting in enriching local governance, education and micro-enterprise development.

In the past Australia made significant contribution in the Community Forestry Programme in Nepal. Australia"s support in health, civil aviation, administration, community development, agriculture, heath, micro enterprise development, and peace building have remained important.

Economic Relations

Trade Relations

Nepal exports carpets. cotton dress, tea, coffee, pasta, felt products, noodles, shawls, articles of jewellery, essential oils, articles of leather, clothing, floor covering, handicrafts to Australia and imports refined petroleum products, dairy products, beverages, spirits and vegetables. There is growing volume of imports than exports with Australia which occurs in trade deficit to Nepal. Nepal"s export to Australia has remained in AUD16 million in 2023 whereas Nepal"s import from Australia has reached to AUD 186 million in 2023 resulting huge trade deficit. Nepal has benefited from Australia"s policy of preferential access to the LDC"s imports in Australian market. Increased production, maintaining quality and continuous supply of the products and services help in improving the situation. (Data source: TEPC).

A study report conducted by Embassy of Nepal, Canberra entitiled “Nepal"s Export to Australia: Status and Potential” can be accessed from here:- Nepal"s Export to Australia: Status and Potential

Nepal-Australia Trade and Investment Framework Arrangement (TIFA)

Trade an Investment Framework Arrangement between the Government of Nepal and the Government of Australia (TIFA) was signed on 9 February 2024. H.E. Kailash Raj Pokharel, Ambassador of Nepal to Australia and the Hon. Tim Watts MP, Assistant Minister for Foreign Affairs of Australia signed the Framework Arrangement on behalf of their respective governments. The Arrangement aims to promote and deepen bilateral economic relations between Nepal and Australia by encouraging and facilitating the trade and investment. With the conclusion of TIFA, the bilateral economic relations between Nepal and Australia is expected to grow for mutual benefit.

Tourism

Nepal continues to be a country of attraction for Australian tourist. In 2023, the Nepal Tourism Board registered 38,789 Australian tourist arrival record in Nepal. The COVID 19 Pandemic triggered unprecedented crisis in this sector and the number was declined to 2,477 in 2021. With the lifting of travel restrictions and normalcy in the situation, the number is expected to increase in the coming years. (Data source: NTB)

Foreign Direct Investment

The total number of industries approved for Foreign Direct Investment up to 2023 from Australian investors is 79 in different sectors amounting AUD 13 million which generates 2305 job opportunities in Nepal. (Data source: DOI)

Education

The latest Australian census results -2021 show there are 122,515 Nepalese-born people living in Australia, a 124 per cent increase in five years, mostly students. Nepali students are the third largest sources of international students in Australia. Nepali students are currently paying annually over AUD 2 billion for tuition fees in Australia from Nepal.