Nepal Friday assured India that its territory will not be used for anti-India activities and agreed to address New Delhi's concerns over fake currency being smuggled through Nepali territory.
These assurances were conveyed when India's External Affairs Minister S.M. Krishna held delegation-level talks with Nepal's Deputy Prime Minister and Foreign Minister Sujata Koirala.
The two foreign ministers discussed an entire range of bilateral issues, including India's development assistance, border security and ways to combat crime, including the smuggling of fake currency, an issue of pressing concern for New Delhi.
"We talked on how to solve these problems," Koirala told reporters after the talks.
Krishna conveyed India's readiness to update the 1950 bilateral treaty of friendship in tune with contemporary realities and offered India's help to spur Nepal's peace process and constitution writing.
Accompanied by senior officials, including Foreign Secretary Nirupama Rao, Krishna arrived here Friday on a three-day visit, his first trip to the neighbouring country after assuming office last year.
Krishna also called on Prime Minister Madhav Kumar Nepal.
"India and Nepal share a unique relationship that is rooted in shared civilizational links and close people-to-people contacts," Krishna said in a statement after arriving in the Nepali capital.
"I am confident that my visit would help further strengthen and expand our bilateral relations and open more avenues for cooperation for mutual benefit," he said.
Krishna's visit to Nepal comes at a time when the peace process in that country is unravelling and Maoists are stoking anti-India sentiments for political gains.