The Biratnagar camp office, 380 kilometres from Kathmandu, was opened in 2008 for relief work after the embankment along the Koshi river in Bihar, near the border with Nepal, broke and a massive flood swept the region.
"The purpose for which this camp office was opened has been fulfilled. India had already decided to wind up the camp office and re-locate the personnel," foreign ministry spokesperson Raveesh Kumar said.
"This decision was conveyed by Prime Minister Modi to his Nepalese counterpart during his visit to Nepal last week. The PM of Nepal thanked the PM for informing him about this decision," Mr Kumar said.
The temporary office in Biratnagar was mainly used for issuing passes to vehicles going India after a 17-km-long stretch of the East-West Highway was damaged due to floodwater, the Kathmandu Post reported.
Investigators suspect that members of a local political group, which had called a strike in Biratnagar around that time, could have had a hand in the explosion. The blast had puncheh a hole on the compound wall of the embassy camp, which is toward the secluded rear area of the main office building.
During his Nepal visit, PM Modi and Mr Oli jointly inaugurated the Ramayan circuit bus route that connects Janakpur, 225 km from capital Kathmandu, to Ayodhya. "For centuries the ties between Ayodhya and Janakpur are unbreakable," PM Modi had said.
With inputs from ANI
Election Results for Lok Sabha Election 2019 will be out on May 23. Get the latest election news and live updates on ndtv.com/elections. Catch all the action on NDTV Live. Like us on Facebook or follow us on Twitter and Instagram for news updates from each of the 543 parliamentary seats for the election 2019