Indian Prime Minister Manmohan Singh will hold talks with his Nepali counterpart Girija Prasad Koirala Wednesday on the rejuvenation of the shattered Nepal economy and an array of other bilateral issues.

Koirala, who will come here Tuesday evening on a four-day official visit, will brief Manmohan Singh on steps taken by his government to strengthen democracy and economy after weeks of protests forced King Gyanendra to cede power to a seven-party alliance.

New Delhi will announce a massive economic aid package estimated to be over 20 million U.S. dollars to revive the economy of the Himalayan state battered by nearly a month of unrest and shutdown in May.

Koirala's visit to India will be his first foreign trip after becoming the prime minister of Nepal over a month ago.

The details of the package are likely to be finalized during a meeting between Indian Finance Minister P. Chidambaram and his Nepali counterpart Ram Sharan Mahat here Thursday.

The economic package is likely to focus on capacity building and infrastructure, especially road building, for long-term development of the Himalayan state.

Manmohan Singh and Koirala will also discuss steps to place bilateral relations on a new footing and are likely to reappraise a 1950 treaty to bring it more in tune with contemporary realities.

The visit will also give Koirala an opportunity to discuss afresh bilateral projects and issues like hydroelectric projects and border demarcation, reliable sources said.

Although all bilateral and global issues, including the role of the UN and international community in the stabilisation of Nepal, will be discussed, economic diplomacy will top the agenda of Koirala's visit.

"The talks would be on financial assistance, Indo-Nepal benefits and Nepal's economic development," Indo-Asian News Service quoted Nepali Home Minister Krishna Prasad Sitaula as saying.

Koirala is also expected to discuss with Manmohan Singh the ongoing negotiations between the Nepalese government and rebels on the shape of the future political structure and the election to constituent assembly in Nepal.

Source: Xinhua