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The first railway in Nepal opened in 1927 from Raxaul (India) to Amlekhganj, a distance of about 48km (46km in Nepal). It was built to 2ft 6in (762 mm) gauge.

This was joined in 1937 by a separate 2ft 6in (762 mm) gauge line, running for about 53km (50km in Nepal) from Bizalpura via Janakpur to Jaynagar (India), where there is interchange with a metre gauge line of the Indian Railways network.

The Amlekhganj line closed in the 1960s. About 6km of this route was subsequently used for a broad gauge (5ft 6in, 1675 mm) branch line from Raxaul to an Inland Clearance Depot at Birgunj. This line is used exclusively by freight trains operated by Indian Railways.

The line from Bizalpura to Janakpur closed following a bridge collapse. The remainder of the line from Janakpur to Jaynagar (about 32 km) remains operational, mainly for local passenger traffic with some freight.

Around 2010, proposals emerged for several major new railways. A 945km electrified line is planned to run the length of the country from Kakarvhitta in the east to Bhim Datta in the west, continuing to the Indian border at Gaddachowki. Construction of the first 5km section near Simara commenced in 2014. A number of smaller projects totalling some 180km are proposed, mainly concerning cross-border connections with India. A feasibility study for a metro system in the capital, Kathmandu, was initiated in 2012.

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