India Bhutan Relations under Modi Government in India

Bhutan was the first country that Prime Minister Modi visited after his appointment to the post. This action in itself signifies to the world the importance attached by India to Indo-Bhutan relations. Bhutan is of strategic, geo-political and economic significance to India.

Diplomatic Relations

India is a country which has antagonistic neighbours, with it even having gone to war with two of them. In such a scenario, a friendly neighbour becomes crucial. India and Bhutan have historically had friendly relations. India has had a friendship treaty with Bhutan since 1949. This treaty was revised in 2007 wherein it was stated that the two nations shall cooperate closely with each other on issues relating to their national interests, and that they would prohibit the use of their territories for carrying out of activities harmful to the national security and interest of the other nation. Also, Bhutan is a member of SAARC too like India, and increased regional cooperation with SAARC members is on top of India’s agenda.

Cultural Exchanges

India and Bhutan have strong cultural and historic ties. There is a steady flow of people from Bhutan to India who travel for purposes of education, employment, medical care etc. The social interactions amongst the people of the two nations have been cemented over the years, forming a strong friendship.

Economic interests

India operates multiple hydroelectric projects in Bhutan, and is in the process of building a few more projects. Also, during summer, Bhutan produces more electricity than it requires. During such months, Bhutan supplies electricity to India, which faces huge energy deficiencies.  Additionally, the two nations are irrevocably bound through mutual economic interests.  India is Bhutan’s largest trade and development partner. India gives aid to Bhutan and is also involved in a variety of projects there. India accounts for 98% of Bhutan’s exports and 90% of its imports. Indian businesses are also active in Bhutan. Tata Power is currently building a dam in Bhutan which is expected to boost Bhutan’s economy by 20%.

Strategic interests

Bhutan’s location makes it strategically important for India. Bhutan acts as a buffer between China and India. It is crucial for India’s interests that it stop China’s influence, which extended from mainland China to Tibet in the past decades, from extending to Bhutan also.

Additionally, Bhutan is crucial for India’s attempts to curb insurgencies in the North-East of India. In the past too, Bhutan has helped India round up ULFA insurgents who fled to Bhutan when India initiated a crackdown against them on Indian soil.


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