India- Bhutan Relation

Context- Bhutan’s fifth King Jigme Khesar Namgyel Wangchuck has began his visit to India recently

Key Highlights About India – Bhutan Relation 

Historical Connection

• India and Bhutan have been linked since 1910, when Bhutan became a protectorate of British India, allowing Britain to “command” its foreign policy and defense.
• When India declared her independence in 1947, Bhutan was one of the first countries to recognize it.
• Since then, relations between the two countries have grown stronger, especially since Bhutan has historically had a strained relationship with China.
  • India and Bhutan not only share a 699-kilometer border, but they also share deep religious and cultural ties.
  • Guru Padmasambhava, a Buddhist saint, played a key role in spreading Buddhism and consolidating the traditional ties between the peoples of the two countries.
  • India opened a special envoy office in Thimphu in 1968, and Bhutan retaliated in 1971. Two envoy offices were upgraded to full-fledged embassies in 1978.
• The cornerstone of the bilateral relationship between India and Bhutan was the 1949 India-Bhutan Treaty of Peace and Friendship.
  • However, Article 2 of the treaty allowed India to play an important role in carrying out Bhutan’s foreign policy.
  • As a result, some changes were made to the Convention in 2007.
  • The new treaty says Bhutan can import weapons as long as India’s interests are not compromised and the weapons are not re-exported by the government or individuals.
  • Articles 6 and 7 of the current treaty deal with the issue of “national treatment” and the equal privileges of citizens on each other’s lands.

Indo-Bhutan Treaty of Peace and Friendship, 1949

• Among other things, the treaty provides for lasting peace and friendship, free trade and commerce, and equal justice for each other’s citizens.
• In 2007, the treaty was renegotiated to include provisions to promote Bhutan’s sovereignty, removing the need to follow Indian guidelines in foreign policy.
• The updated treaty provides for closer cooperation in national affairs as well as greater cooperation in the cultural and economic spheres.

Importance of Bhutan to India

• Geographic importance:

• • • Bhutan borders his four states of India: Assam, Arunachal Pradesh, West Bengal and Sikkim.
    • Surrounded by the Himalayas, Bhutan acts as a buffer zone between India and China.
    • The security of today’s Bhutan borders, especially the western border, is of great importance to India.

• Economic implications:

• • • Bhutan provides a market for Indian goods and is an investment destination for India.
    • Bhutan is also a rich source of hydropower for India.

• Political significance:

• • A politically stable Bhutan is important to India.
  • A volatile and troubled Bhutan can provide a safe haven for anti-India activities and anti-India extremist groups.

Areas of Cooperation

Trade:

• Trade between the two countries is governed by the India-Bhutan Trade and Transit Agreement of 1972, last renewed in November 2016.
• The agreement establishes a free trade regime between the two countries and also provides for duty-free transit of Bhutanese exports to third countries.
• India is Bhutan’s largest trading partner.
• From January to June 2018, the trade volume between the two countries was Rs 4,318.59 crore.
• India’s major exports to Bhutan are mineral products, machinery and equipment, electrical equipment, etc., while major imports from Bhutan are electricity, ferro-silicon, Portland cement, etc.

Economic aid:

• India is Bhutan’s major development partner.
• Since Bhutan’s first five-year plan was launched in 1961, India has provided financial support for Bhutan’s FYPs.
• India has allocated Bhutan her twelfth FYP Rs 4500 krone.

Water resources:

• India plays a key role in the development of hydropower projects.
• This will not only provide the Bhutanese people with electricity for their own consumption, but also generate income from the surplus electricity that will be exported to India.
• So far, the Indian government has set up three hydropower projects (HEPs) in Bhutan.
• India is currently helping Bhutan to develop a power plant on the Mandechu River.
• This hydropower cooperation falls under the 2006 Hydropower Cooperation Agreement, and according to the protocol of the agreement, India commits Bhutan to develop at least 10,000 MW of hydropower by 2020, from which surplus power will be imported.
• India has also agreed to support India and Bhutan also have a Joint Expert Group (JGE) on Flood Management.

Border control:

• There are ministerial-level mechanisms for border control and security-related issues between the two countries.
• There is also a Border District Coordination Meeting (BDCM) mechanism between the bordering states and the Royal Government of Bhutan (RGoB) to facilitate coordination of border controls and other related matters.

Educational and cultural cooperation:

• Many Bhutanese college students study in India.
• The Indian government offers many scholarships for Bhutanese students.
• There are regular cultural exchanges between the two countries.
• Founded in 2003, one of the basic goals of his India Bhutan Foundation is to promote people-to-people exchanges in the cultural field.

Indian community:

• About 60,000 Indians live in Bhutan, mainly engaged in the construction of hydroelectric power plants and the road industry.
• In addition, approximately 8,000 to 10,000 workers enter and exit Bhutan daily in border towns.

Multilateral partnerships:

• India and Bhutan are founding members of the South Asian Association for Regional Cooperation (SAARC), which deals with the economic, social and cultural development of the South Asian region.
• Both also share other multilateral fora such as BBIN (Bangladesh, Bhutan, India and Nepal) and BIMSTEC (Bay of Bengal Initiative for Multi Sectoral Technical and Economic Cooperation).

Challenges 

• There have been cases of India interfering in Bhutan’s internal affairs.
• This has created a negative perception of India in the minds of the Bhutanese, who find it selfish to develop hydropower in Bhutan as India receives Bhutan’s surplus electricity at a relatively low price. The feeling is increasing.
• As India shifts to renewable energy sources such as wind and solar, Bhutan is concerned about the viability of hydropower projects.
• From a domestic security perspective, the illegal construction of camps by extremist groups in the dense jungle of southeastern Bhutan is cause for concern. for both countries.
• China’s relentless claims to key border areas such as the Chumbi Valley and Doklam and its continued efforts to build strong diplomatic and economic ties with Bhutan are constant concerns for India.

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