South Asian leaders reach agreement on energy; India's Modi and Pakistan's Sharif shake hands

KATMANDU, Nepal – South Asian heads of state attending their first summit in three years reached a deal on energy sharing Thursday, but failed on two other economic agreements during a retreat where Indian and Pakistan leaders shook hands.

Foreign ministers from the eight nations signed the agreement on distribution and transmission of electricity through a common grid at the end of the two-day summit where Indian Prime Minister Narendra Modi and his Pakistani counterpart, Nawaz Sharif, smiled at each other, spoke a few words and shook hands.

The gesture between Modi and Sharif after the closing ceremony was broadcast live on television and applauded by those attending the summit.

The economic agreements left unsigned involved roads and railways connectivity. Nepalese Prime Minister Sushil Koirala said the transport ministers would meet within three months and work on reaching an agreement.

Pakistan had made last-minute objections to all three agreements because of incomplete internal procedures, but the energy deal was clinched after the leaders retreated to a mountain resort near Nepal’s capital where they held free and informal discussions.

Though the summit began on Wednesday, it was only at the retreat that Pakistan’s and India’s leaders spoke to each other and shook hands. That was followed by the much public gesture at the closing ceremony.

Indian officials have already said exchanging courtesies among the leaders did not mean talks between the two South Asian rivals.

“If they interact, exchange courtesies and exchange a few words, that does not translate as dialogue,” Indian External Affairs Ministry spokesman Syed Akbaruddin said earlier.

The South Asian Association for Regional Cooperation summit is meant as a broader forum but is usually dominated by the rivalry between Pakistan and India.

Sharif said the next summit would be held in Pakistan in 2016.