India and Bhutan have reached a significant agreement to establish a concessional Line of Credit amounting to Rs 4,000 crore focused on energy projects in Bhutan. This arrangement was formalised during the official visit of External Affairs Minister S. Jaishankar to Bhutan from September 16 to 18, where he was invited by Bhutan’s Foreign Affairs and External Trade Minister DN Dhungyel.

During this visit, Jaishankar and Dhungyel engaged in discussions regarding various facets of bilateral cooperation, alongside regional and international matters of shared interest. The ministers expressed their satisfaction with the advancements achieved in the India-Bhutan energy partnership, which has seen substantial progress in recent years.

The ministers acknowledged key developments within energy cooperation, specifically highlighting the inauguration of the 1020 MW Punatsangchhu-II Hydroelectric Project and the signing of its Tariff Protocol. They also mentioned the recommencement of construction on the 1200 MW Punatsangchhu-I Hydroelectric Project as a pivotal point in ongoing collaboration.

Inauguration of Development Projects

During Jaishankar’s visit, several development initiatives were jointly inaugurated or launched by both ministers. This included the 65-bedded Gyaltsuen Jetsun Pema Mother and Child Hospital located in Mongar, the Jaganathan Bridge along the Samdrup Jongkhar-Trashigang Highway, and the Lunana Hydropower Project with a capacity of 500 kW.

Furthermore, both sides welcomed the transfer of 54 electric vehicles to the Royal Government of Bhutan. The MEA also reported the transfer of 43 Jersey cows from India to Bhutan’s National Cattle Breeding Centre situated in Bumthang. These projects and transfers indicate ongoing collaboration in infrastructure and agricultural development.

Jaishankar reaffirmed India’s commitment to support Bhutan’s developmental objectives, while Bhutan recognised India’s backing of initiatives under its 13th Five-Year Plan (2024-29). The ministers delved into various areas of interest, including trade and transit, digital payments, and ongoing projects aimed at enhancing cross-border connectivity.

Commitment to Enhanced Cooperation

India has reiterated its determination to establish an Immigration Check Post at Hatisar in Assam, facilitating the movement of investors and visitors heading to Gelephu. Progress on cross-border rail links such as Gelephu-Kokrajhar and Samtse-Banarhat was also discussed, demonstrating an emphasis on increased connectivity between the two nations.

Additionally, both nations celebrated the operationalisation of a UPI-based payment facility that allows Bhutanese nationals to make digital payments in India through their local mobile applications. This step represents a significant advancement in digital finance between the two countries.

The discussions also embraced educational cooperation, with an agreement to double the number of Bhutanese students eligible for scholarships under the Indian Council for Cultural Relations from 30 to 60. Furthermore, there will be an increase in seats available under the Nalanda University Scholarship Scheme, from 30 to 55.

India expressed its gratitude towards Bhutan for supporting its candidacy for a non-permanent seat on the United Nations Security Council for the 2028-2029 term. In a reciprocal gesture, India welcomed Bhutan’s ratification of the Framework Agreement of the International Big Cat Alliance. Jaishankar concluded the visit by inviting Minister Dhungyel to India at his earliest convenience.

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