India has extended $250 million line of credit to Nepal during the Nepalese President Ram Baran Yadav's state visit to the country.

The line of credit will be offered through the Exim Bank. India has also supply 80,000 tonnes of essential food grains to the country.

The two countries signed four pacts which include setting up new railway links, an updated air services accord, an India-sponsored polytechnic and construction of a new convention hall near the India-Nepal border.

India will supply 50,000 tonnes of wheat, 20,000 tonnes of rice and 10,000 tonnes of yellow peas of food grains to the neighboring country. An additional 2,000 tonnes of wheat will also be offered on request.

India had committed Rs. 2,000 crore to the country which includes Rs. 805 crore to improve roads in the plain areas of the country. It is involved in nearly 30 medium and large projects and 335 grass roots-level projects in areas such as health, education and community development.

The Nepalese President is on a four four-day state visit to the country. He had arrived on Monday when he was received by the President of India Pratibha Patil in a ceremonial welcome at Rashtrapati Bhawan. Mrs. Patil also hosted a state banquet in his honor on Tuesday evening.

He met Prime Minister Manmohan Singh on Tuesday when they held discussions for a little less than an hour. Mr. Singh conveyed that he was honored by his visit and also emphasized on the special relationship shared by the two countries.

Mr. Yadav expressed "deep gratitude" for India's help in the country's development. He is the first president of the Himalayan country which abolished it royal dynasty and elected a representative in 2008. This is the first ever visit of the Nepalese President to India.

After the discussion the PM hosted the Nepalese President for lunch at Hyderabad House. Mr. Yadav also met External Affairs Minister S. M. Krishna along with other leaders like Vice President Hamid Ansari, United Progressive Alliance (UPA) chairperson Sonia Gandhi, Finance Minister Pranab Mukherjee, Home Minister P. Chidambaram and Leader of Opposition Sushma Swaraj.

The visiting President will also visit the holy city of Haridwar to take part in the Maha Kumbh Mela on Wednesday.