INDIA is finalising an agreement to provide energy-starved Nepal with electricity, Delhi’s Foreign Minister Sushma Swaraj said at the end of a three-day official visit today.

Nepal’s Maoist insurgency, which lasted until 2006, and ensuing political instability have hampered the construction of new power plants and Kathmandu acknowledges that it cannot afford to map out an energy strategy on its own.

A joint press statement revealed that the two countries were able to agree on 26 issues including finalising the power deal.

Under the agreement, India will export electricity to Nepal and help build hydroelectric power plants.

Nepal has suffered from major power shortages, with consumers facing cuts up to 12 hours daily because power plants are able to meet only half the total demand. India supplies all of Nepal’s oil needs and much of its trade.

Indian Prime Minister Narendra Modi is set to visit Kathmandu next month.