Under the project, initial supply will be 80 Mw, which will be augmented to 200 Mw by October and 600 Mw by December 2017, a Prime Minister Office's press release said.
Read more from our special coverage on "NEPAL INDIA RELATION"
Oli is on a six-day state visit to India.
According to the statement, the Nepal portion of the 400 Kv Muzaffarpur-Dhalkebar line is being implemented by the government of Nepal, under an line of credit of $13.5 million.
The 80 Mw power would flow immediately through this line, with an initial charge of 132 Kv. Thereafter, it will be augmented to 200 Mw in October 2016 at 220 Kv, and then to 600 Mw by December 2017 at 400 Kv.
The two nations also inked an MoU on strengthening of road infrastructure in the Terai area of Nepal.
This pact will enable speedy implementation of remaining work on 17 roads in package 2, 3, 4, 5 and 6 of the Terai Road Phase-I project, totalling 518 km. Two roads in Package 1 totalling 87 km have already been completed, it said.
India and Nepal also inked pacts on transit between Nepal and Bangladesh through Kakarbitta-Banglabandh corridor and Operationalisation of Vishakhapatnam Port.
"This Exchange of Letters between India and Nepal would result in simplification of modalities for traffic of goods between Nepal and Bangladesh while transiting through India, through the Kakarbhitta (Nepal) and Banglabandha (Bangladesh) corridor," the statement said.
On exchange of letters on Visakhapatnam port it said this would provide for transit facilities for Nepal.
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