Prachanda has raised the matter in protest letters to Prime Ministers Narendra Modi and Sushil Koirala of Nepal, and Chinese President Xi Jinping.
The letter urged India and China to "rectify" the May 25 bilateral pact between New Delhi and Beijing on Lipulekh, a disputed land situated in the far-west Nepal, according to party sources.
In the letter Prachanda said the agreement between India and China to use Lipulekh as a bilateral trade route goes against the provisions of the historic Sugauali Treaty signed by Nepal and India during the British rule in 1816.
As per the letter, the Sugauali Treaty clearly states that the territories east of Kali river belong to Nepal.
"We believe that paragraph 28 of the joint statement between India and China incorporating Lipulekh as a bilateral trade route between the two countries runs against the provisions of the Treaty Sugauli, 1816, between Nepal and India," writes Prachanda.
The letters have been sent to both the governments of India and China through their embassies in Kathmandu.
A copy of the statement was also handed over to Prime Minister Koirala.
He urged India and China to take necessary diplomatic initiative to address "this genuine concern of the Nepalese people by making appropriate correction in the agreement".
