Prime Minister Narendra Modi and his Nepalese counterpart Pushpa Kamal Dahal earlier held talks on several areas of partnership between the two countries.
In a joint statement issued by the two sides later, they gave various details related to strengthening of ties.
"They stressed the need to ensure that the open border, which has facilitated economic interaction and movement of people and goods on both sides of the border and has been a unique feature of India-Nepal bilateral ties, is not allowed to be misused by unscrupulous elements posing security threats to either side," it said.
"Both sides also agreed to set up an oversight mechanism comprising senior officials from the Indian Embassy in Kathmandu and the Government of Nepal, which will review progress together with respective project implementing agencies/developers of ongoing economic and development projects on a regular basis, and take necessary steps to expedite their implementation," it said.
The Prime Minister of Nepal shared with his Indian counterpart the efforts made by the present government to take all sections of Nepali society on board for effective implementation of the constitution.
The two Prime Ministers stressed on the need for early development of infrastructure at integrated check posts (ICPs) to facilitate smooth and faster movement of people and goods.
"They noted with satisfaction the progress in construction of ICPs at Raxaul and Jogbani, and agreed that work on the Raxaul-Birgunj ICP project will be expedited with the objective of completing it by December," the joint statement said.
"The two Prime Ministers directed the officials to
expedite the construction of sub-station at Dhalkebar so that the Muzaffarpur-Dhalkebar transmission line can be operated at its full capacity as planned," the joint statement said.
"The two Prime Ministers expressed satisfaction that both countries are engaged in preparation of a Master Plan for cross-border interconnection for the period until 2035 and Action Plan on power trade until 2025," it said.
"It was decided to expedite finalisation of the Detailed Project Report of the Pancheshwar multi-purpose project. It was agreed that both sides will continue to take measures to operationalise the Power Trade Agreement signed in 2014.
"Both sides agreed to discuss all water resources cooperation related matters such as inundation and flood management, irrigation matters and other major projects, at the next meeting of the Joint Committee on Water Resources at Secretary level, to be convened at an early date," it said.
"Both the Prime Ministers expressed satisfaction at the utilisation of the two Lines of Credit of USD 100 million and USD 250 million for development of roads and power infrastructure in Nepal," it said.
They welcomed the allocation of USD 200 million for irrigation projects, and USD 330 million for development of roads and Mahakali bridge from the Line of Credit of USD 550 million.
The Nepal Prime Minister extended an invitation to his counterpart to pay an official visit to Nepal which Modi accepted. The date will be finalised through diplomatic channels, it said.
"The two Prime Ministers welcomed the commencement of work for construction of a dharmashala at Pashupatinath area. The MOU between the Pashupati Area Development Trust and the Archaeological Survey of India for reconstruction and renovation of the monuments at the Pashupatinath Area will be finalised expeditiously," the statement said.
The two sides stressed on the need for "taking forward the cooperation" in the fields of tourism and ayurvedic system of healthcare.
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