India extended a $250mn credit line for infrastructure projects in Nepal yesterday, during a visit by Nepalese Prime Minister Baburam Bhattarai. The dollar credit line agreement, signed between the government of Nepal and the Export-Import Bank of India, would be used to finance projects such as highways, airports, bridges, irrigation, roads, railways and hydropower projects, said a statement from India’s Foreign Ministry. The two sides also signed an agreement to protect and promote investments from either side. The pacts were signed after Bhattarai held delegation-level talks with Indian Prime Minister Manmohan Singh which largely focused on economic issues, diplomatic sources said. Bhattarai arrived in the Indian capital on Thursday on a four-day visit - his first trip abroad after becoming PM in August. The visit came at a crucial time for Nepalese politics, as efforts are under way to integrate and rehabilitate former Maoist rebels, ahead of a November 30 deadline for framing a constitution. The trip was seen as an opportunity to mend strained ties between Bhattarai’s ruling Maoist party and New Delhi. India is fighting a Maoist insurgency and has been cool towards the Nepalese Maoists, who have close ties to China. The Maoists have in turn resented the huge political influence India has historically exerted over its northern neighbour. Bhattarai described India as a significant economic partner and said his trip was aimed at promoting co-operation in the energy sector and business and investment. Nepal produces less than half the electricity it needs and relies on India for the rest. Bhattarai also briefed Singh and other Indian leaders on recent political developments in Nepal and sought their support in reinvigorating its peace process, IANS news agency reported, citing diplomatic sources. “Our fates are interlinked,” Bhattarai was quoted as saying at a welcome reception. “Let’s resolve to continue our struggle,” he said while admitting the challenges facing Nepal were formidable as it pushed forward with the peace process.” “Our goal is to find real democracy and participatory democracy for the masses,” Bhattarai said at the gathering organised by his former classmates and friends from New Delhi’s School of Planning and Architecture and Jawaharlal Nehru University. The decade-long war between Maoist rebels and the Nepalese government ended in 2006 with a peace agreement that saw the Maoists join mainstream politics.