The Government of Nepal has suggested modifications to the proposed Kathmandu-Raxaul railway layout to India to avoid overlapping with the proposed Nijgadh International Airport and Kathmandu-Nijgadh Expressway. After reviewing the proposed railway, designed by the Indian company Konkan Railway Corporation Limited, the Government of Nepal highlighted the need for changes to avoid areas rich in minerals such as uranium. A new map is recommended for the final location survey, which is similar to a detailed project report (DPR) submitted by the Indian company during Prime Minister Pushpa Kamal Dahal's visit to India in May last year.

"We have requested to include in the report what kind of structures need to be built in case of railway intersections with the highway and Nijgadh airport," said Krishnaraj Pant, joint secretary of the Ministry of Physical Infrastructure and Transport. Many foreign affairs experts view the proposed railway connecting Nepal's capital Kathmandu with the Indian border town of Raxaul as a strategic project for India. While China is exploring the feasibility of a rail link between Kathmandu and its border city of Kerung, India is advancing the Raxaul-Kathmandu railway.

According to Pant, the current study report does not address issues concerning highways, airports, and mines. A 70.97 km long expressway connecting Kathmandu with the Terai region is under construction, and the government has initiated the process to build an international airport in Nijgadh. Due to the presence of a uranium mine along the proposed route, Nepal has suggested altering the railway's path to mitigate health risks. Pant said, "The final location survey will be completed once the report incorporates these suggestions provided by the ministry."

The Department of Mines and Geology has already issued license for survey of precious minerals in six places along the proposed railway. The Indian company's report proposes that the entire railway, spanning 140.79 km, will connect Raxaul with Kathmandu and include 12 stations at Raxaul, Birganj, Belwa, Manharwa, Saphi Bazar, Nijgadh, Makwanpur, Diyal, Shikharpur, Sisneri, Satikhel, and Kathmandu.

The final location survey report submitted by Konkan to the Ministry indicates that the railway can be completed in five years, with an estimated construction cost of Rs 383 billion (approximately INR 2.39 billion). This estimate excludes land acquisition and other compensation costs.

In 2020, the Government of Nepal requested the Indian government to prepare a detailed project report (DPR) for this railway, but the survey was halted due to the COVID-19 pandemic. An agreement regarding the feasibility study of the Kathmandu-Raxaul railway was reached in August 2018 between the governments of Nepal and India.