The truck with medicines was torched by the cadres of the agitating Joint Democratic Madhesi Front (JDMF) close to the Indian border town of Raxaul, despite an assurance by the protesters that they would allow vehicles to move into Nepal.
Nepal is facing a huge shortage of medicines and other essential goods due to a two-month-long agitation by the Madhesis in the Terai region, the police said.
The fire that erupted in the truck destroyed the medicines imported from India worth more than Rs two million.
Yesterday, the JDMF had issued a statement that they would allow movement of medicine-laden vehicles and would let the schools in southern Nepal function normally.
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Meanwhile, the cadres of the agitating Madhesi Front also set an ambulance on fire, in Morang in eastern Nepal.
The vehicle was ferrying a sick child to a local hospital in district headquarters Biratnagar.
Police have arrested eight members of the agitating Madhesi parties for their alleged involvement in the incident.
Nepal has been hit by a major political crisis over the new Constitution opposed by Indian-origin Madhesis who have led an agitation and blockaded at key border trade points of Nepal with India, leading to a shortage of essential goods including fuel and cooking gas.
Madhesis, Indian-origin inhabitants of Nepal's Terai region, are protesting against division of their ancestral homeland into seven provices in the new Constitution.
More than 40 people have died in the violent agitation that has also overwhelmed Indo-Nepal ties as transit of goods and fuel to the Himalayan nation from India has been badly affected.