By employing a historical approach, this paper seeks to examine the past as well as present socio-economic conditions in the Tarai of Nepal, with a special reference to the Indian migration into the area. It traces the migration of Indians into the Tarai after the unification when the Shah rulers encouraged Indians to settle in the Tarai regions of Nepal but were cautious of the entry of Indian traders for the fear that they would turn the Nepali subjects into ‘paupers’; the Rana rulers’ (1846-1951) deliberate policy of encouraging migration from India to maximise agricultural production and revenue from the land, cultivate birta and guthi land, and develop the Tarai by building market towns which would allow Nepal to benefit from the expansion of Indian railheads close to the border towns of Nepal. The article points out that as the Tarai emerged as Nepal’s granary and also the source of almost all the exportable surplus, the influx of hill migrants into the Tarai which until then had been regarded as a ‘Death Valley’, increased. Thus, by 1964, the government shifted its official policy to attract Indian settlers to discouraging their further settlement in the Tarai. In conclusion, the paper argues that while the migration of Indians into the Tarai led to ‘indigenous economic development’ in the sense that there was little need for planning or complex bureaucratic organisation or capital investment, the restriction of foreign nationals (i.e., Indians) since the 1960s has meant that it has become difficult to differentiate the immigrant Indians from the local Tarai people—an unforeseen ill-effect which is likely to be disruptive to Nepal’s future development.

Dahal, D.R. 1983. Contributions to Nepalese Studies. 11:1, 1-120.