Daily Current Affairs for UPSC : 8 Nov , 2025/ India- Bhutan Relations

Prime Minister Narendra Modi is likely to be visiting Bhutan next week for the fourth time since 2014. Although the Ministry of External Affairs (MEA) has not yet made an announcement, a source familiar with the itinerary said it is expected to focus on energy cooperation and connectivity and that it will be a two-day visit.
The PM is expected to travel around the same time as the 70th birthday celebrations of former King Jigme Singye Wangchuck, father of the present king, and will include the opening of the 1,020 megawatt Punatsangchhu-II Hydropower Project funded partly by Indian grants and partly by loans.

The PM is also expected to take stock of the progress of two new India-Bhutan railway projects, the Kokrajhar-Gelephu link, which will link Assam to southern Bhutan, and the Banarhat-Samtse line, which will link southwestern Bhutan to West Bengal. The Kokrajhar-Gelephu link will consist of six stations, with two important bridges, 29 major bridges, 65 minor bridges, two goods sheds, one flyover and 39 underpasses, to be constructed within four years of commencement. The Banarhat-Samtse link will consist of two stations with one major bridge, 24 minor bridges, one overpass, and 37 underpasses, and will be completed within three years of commencement. When announcing these projects, Foreign Secretary Vikram Misri said that they would significantly enhance the overall connectivit.

Historical Development:
Earlier Diplomatic Relations:
• Relations between Bhutan and British India began in the 19th century.
• From the Treaty of Punakha (1910), Bhutan agreed to pay homage to the British government and permit it to guide its foreign affairs.
• When India became independent, it signed the Treaty of Friendship (1949), which established formal relations with Bhutan. Bhutan agreed to consult with India on “all matters of external affairs” and on “all matters of defense.” India recognized Bhutan’s independence and sovereignty.
Post-Independence Relations and Development Partnership:
• India has been helping Bhutan with its development since the latter’s First Five-Year Plan (1961).
• India financed many of the major infrastructure projects, roads, schools, and hospitals in the country.
• Over time, the development assistance expanded to hydropower, trade, education, culture, and connectivity.
Geopolitical Importance
• The geographical position of Bhutan between India and China is another important strategic factor for India.
• India provides Bhutan security and defense cooperation, including training of Bhutanese security forces and cooperation in border management.

Recent Developments (2024–2025):
Economic and Developmental Cooperation • India remains Bhutan’s chief trading partner, making up over 70% of Bhutan’s total trade.

• In 2024–25 India provided concessional loans and development assistance to Bhutan for infrastructure and social projects, including the Gyalsung academies, etc.

• Both sides are expanding their trade in agriculture, manufacturing, and services.
Hydropower and Energy Partnership:

• Hydropower remains the centerpiece of bilateral relations.

• Projects such as Chukha, Tala, Kurichhu, Mangdechhu and Punatsangchhu deliver clean electricity to India and indirect revenue to Bhutan.

• The talks in 2024–25 also centre on increasing the speed of pending hydro projects and the potential for solar and green energy cooperation.
Connectivity and Infrastructure:

• The framework for the first India–Bhutan railway link was proposed in 2024 to enhance trade and tourism.

• Road and digital connectivity projects between Assam, West Bengal and southern Bhutan have also been strengthened.
New Areas of Cooperation:

• Space Cooperation: India and Bhutan signed a Joint Plan of Action in 2024 on space technology and satellite data sharing.

• Environment and Climate: The Joint Working Group on Environment was launched in 2024 to address biodiversity and climate challenges.

• Agriculture: The newly-signed 5-year cooperation deal in 2025 for fertilizer and seed exchange will also benefit both parties