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Although there is a large movement of cross border vehicular traffic between India and Nepal, there is no bilateral Motor Vehicle Agreement. Motor vehicle movement between the two countries is allowed on the basis of understanding reached between the two governments in 1960s, which continues till date. The details of the present arrangements are as follows:

1. Nepal registered vehicles

  1. Nepali vehicles, including two wheelers, have free cross border access to the nearest municipal town/market place or railhead in India provided the vehicle returns to Nepal on the same day. No permit is required nor any levy or tax payable for such visits.
  2. For Nepali vehicles going to the interior parts of India (i.e. beyond the nearest market place or railhead) or for vehicles staying in India for more than a day i.e. night halt, the owners of the vehicles are required to obtain a "Vehicle Permit" from the Embassy of India, Kathmandu or Consulate General of India, Birgunj or the Camp Office of the Embassy at Biratnagar. (The CDOs or other officers of Government of Nepal are not authorized to issue these permits).
  3. Vehicle permits are issued on payment of specified fees and completion of prescribed formalities including submission of a bank guarantee of the requisite amount.  The vehicle permits can be obtained for a maximum validity of 3 or 6 months and for single/double/multiple entries. The 'Permits' are required to be stamped by the Indian Border Check Post both on entering and exiting the Indian territory. 
  4. The Consulate General of India, Birgunj issues vehicle permits in respect of vehicles falling under the 8 districts of its consular jurisdiction namely, Parsa, Bara, Makawanpur, Chitwan, Rautahat, Sarlahi, Mahottari and Dhanusha and registered either with Narayani or Janakpur Zonal Transport Office. Accordingly, only the vehicles having registration number with prefix 'Na' and 'Ja' are advised to approach the Consulate General of India, Birgunj, for issue of vehicle permits. Applications can be made on any working day between 0930-1230 hrs. The permits are normally issued within 3 working days. The relevant forms/details can be downloaded from the list below:
  1. Application Form
  2. Types of Permit and Fee Structure
  3. Requirement of documents etc. and amount of bank guarantee
  4. Proforma of bank guarantee
  5. List of border check posts in India and Nepal
  6. Format for Letter of Authority

2. Indian registered vehicles

  1. Indian vehicles, including two wheelers, can visit the nearest municipal area/market in Nepal for day long visits (return to India on the same day) without payment of any levy or tax. However, the vehicle owners are required to register the vehicle at the Nepalese border check post and obtain a Pass/Challan which has to be compulsorily returned to the Nepal customs authorities while returning back to India.
  2. The Indian vehicles going beyond the nearest Nepali town or staying overnight in the bordering districts of Nepal are required to register the entry of vehicles for the specific number of days on payment of charges varying from NRs. 250/- to 500/- per day depending on the type of vehicle. The Pass/Challan issued by the Nepali Custom Authorities should be available for inspection all the time and has to be surrendered to the Nepali customs authorities at the time of exit from Nepal. 
  3. If the Indian vehicle enters Nepal on day ‘Pass’, it must return to India the same day. Similarly, the vehicles with ‘Pass’ for specific duration must exit Nepal before the expiry of the 'Pass' date and then re-enter on a new 'Pass'. If due to any exigency the vehicle has to overstay in Nepal, the vehicle owner should approach the nearest Nepalese Customs Office (Bhansar) or the Police Authorities for extension of period of the 'Pass'. The extension must be sought within the validity period of the initial permission/'Pass'.
  4. Indian vehicles cannot be retained in Nepal for more than one month even on payment of charges.
  5. Indian vehicles found in Nepali territory without the said entry ‘Pass’ are treated as illegally smuggled into Nepal and these are seized by the police and later auctioned by the Nepali customs authorities. Such stringent measure from the Nepali side is to curb smuggling of stolen Indian vehicles in Nepal as well as the unauthorized commercial use of Indian vehicles in Nepal (The very high customs import duty on vehicles in Nepal tends to encourage smuggling of stolen Indian vehicles in Nepal as well as commercial use of Indian vehicles in Nepal).

DISCLAIMER:-

The aforesaid information are for the sake of guidance of owners of the Indian vehicles entering into Nepal and should not be construed as the exact legal position.