Indian Prime Minister Narendra Modi arrived in Nepal on Sunday to try to speed up progress on power agreements while also aiming to counter rival giant China's influence in the region.
Modi flew into Kathmandu for talks on strengthening trade ties including harnessing Nepal's vast hydropower resources in the first visit by an Indian prime minister to the Himalayan nation in 17 years.
Modi, a right-wing nationalist, has sought to shore up support with India's neighbours since sweeping to power at national elections in May, in a bid to check China's sway in the region.
Modi said the two-day visit "highlights the high priority that my government attaches to our relations with Nepal".
"I hope my visit will open a new chapter in India-Nepal relations, characterised by more frequent political engagement and closer cooperation," he said in a statement late Saturday.
Nepal's Prime Minister Sushil Koirala greeted Modi at Kathmandu's international airport, where he received a 19-gun salute while an army band played, an AFP reporter said.
Modi will hold talks with Koirala and also meet with President Ram Baran Yadav during the visit. He is also expected to address Nepal's parliament later Sunday, becoming the first foreign head of government to do since 1990.
The devout Hindu politician will offer prayers at the Pashupatinath temple complex, a UNESCO World Heritage site near Kathmandu that attracts tens of thousands of pilgrims every year, many from India.
Energy security is expected to top of Modi's agenda, with a push to revive stalled projects and develop hydropower plants using Nepal's abundant water resources and Indian investment.
Earlier proposals to develop joint ventures between the two countries have stalled due to disagreements over perceived threats to Nepalese sovereignty, allowing rival China to step into the breach.
Although New Delhi traditionally has exerted huge influence in Nepal, Beijing has recently intensified its engagement with the impoverished Himalayan nation, pumping billions of dollars into infrastructure projects ranging from roads to hydropower plants.
Nepal has endured prolonged political limbo since 2006 when former rebel Maoists laid down arms and signed a peace deal, paving the way for constituent assembly polls two years later.
Since then, Nepal has been politically paralysed, with the assembly -- which also serves as the parliament -- deadlocked over plans to draft a new constitution.