You've squeezed the cable between the crankcases and not it is grounding.
What this does is the neutral light will stay on always!
You have to either Option1: cut that portion of the wiring and make a new wire and connect it to the neutral switch or Option2: take out the engine casing AGAIN insulate the cable where it is bare with tape or heatshrink and maybe that will work out.
Either way, those are the only options...
Option 1 is the easiest one and is probably what you will have to do anyways if ya do go with option2...