INDIA - BHUTAN BILATERAL RELATIONS

3.      This special relationship is further sustained by the tradition of regular visits and extensive exchange of views at the highest levels between the two countries. At the invitation of our President, the King of Bhutan, His Majesty Jigme Khesar Namgyel Wangchuck, paid a State Visit to India from December 21-26, 2009. This was his first State Visit to a foreign country since his coronation as the King of Bhutan in November 2008. HM the King visited India (Kolkata) from 5-7 Oct 2010, during which University of Calcutta conferred upon him the Honorary Doctorate Degree of Law. HM the King again visited India from 20-29 Oct 2010 for the National Defence College (NDC)'s golden jubilee celebrations as Special Guest of Honour. The King and the Queen, HM Jetsun Pema Wangchuck, paid a State Visit to India from October 23-31, 2011 (the first visit abroad after the Royal Wedding on 13 October 2011). Prime Minister Lyonchen Jigmi Y. Thinley visited India from 28 June to 3 July 2009 to felicitate the new Government. The Prime Minister of Bhutan was the first Head of Government to visit India during the present term of the UPA government. PM Thinley visited Delhi from 30 October to 3 Nov for Pan-IIT Conference. This was also the first of his visits to SAARC capitals in the capacity of the Chairman of SAARC. Prime Minister Dr. Manmohan Singh visited Bhutan from 28-30 April 2010 for the 16th SAARC Summit. President Pratibha Devisingh Patil visited Bhutan from 5-8 November 2008 and was the Guest of honour at the Coronation celebrations of His Majesty Jigme Khesar Namgyel Wangchuck the King of Bhutan. Prime Minister Dr. Manmohan Singh paid a very successful State visit to Bhutan from 16-17 May 2008. This was followed by a visit to India by first democratically elected Prime Minister of Bhutan Lyonchen Jigmi Y. Thinley from 14-17 July 2008. The Fourth King of Bhutan Jigme Singye Wangchuck was the Chief Guest at the Republic Day celebrations in January 2005 and visited India for bilateral discussions in August 2005 and July 2006. His Majesty the King of Bhutan Jigme Khesar Namgyel Wangchuck visited India in February 2007.These visits provided an opportunity to discuss bilateral political and economic issues and other issues of mutual interest. Other important high level visits from India in the past have been:

1. Shri V.V. Giri in April 1970 and June 1974
2. Shri R. Venkatraman in October 1988

1. Pandit Jawaharal Nehru in 1958
2. Smt. Indra Gandhi in 1968 and October 1972
3. Shri Rajiv Gandhi in October 1958 and September. 1988
4. Shri P.V Narasimha Rao in August 1993

During Prime Minister Dr. Manmohan Singh’s visit to Bhutan in April 2010 for the 16th SAARC Summit, Implementation Agreements for the Punatsangchhu –II and Mangdechhu Hydro Electric Projects (HEPs) were signed by the Minister of Economic Affairs of Bhutan Lyonpo Khandu Wangchuk and the External Affairs Minister of India Shri S.M. Krishna, in the presence of the Prime Ministers of India and Bhutan. MOUs for cooperation between the Election Commissions of India and Bhutan and UPSC and RCSC were renewed during the visits to Bhutan by CEC Dr. S.Y. Quraishi and UPSC Chairman Prof. D.P. Agrawal from 16-19 and 8-11 September 2011 respectively.

11.   Ninth Five-Year Plan (2002-2008):GOI assistance to Ninth Five Year Plan (2002-08) of Bhutan was Rs. 2610.14 crore. This included Rs 907 crore for project tied assistance, Rs 820 crore as Programme grant and rest as various refunds and subsidies. Major GoI assisted projects completed in the Ninth Plan include 350 bedded JDWNR Hospital in Thimphu, Regional Referral Hospital in Mongar, Phase I of double-laning of Thimphu-Phuentsholing road, double laning of Paro-Chuzom road, construction of 10 new schools, 306 low income housing units, Renovation of Semtokha Dzong, two Youth Centres, RENEW Centre, Human Resource Development, Telecommunications and projects in agriculture and allied sectors. GoI also funded feasibility studies for establishing rail linkages between border towns of India and Bhutan.

12.    Tenth Five-Year Plan (2008-13):The Government of India committed assistance worth Rs. 3400 crores during the 10th FYP. This includes Project tied Assistance (Rs 2000 crore for about 70 projects in key socio-economic sectors such as agriculture, ICT, media, health/ hospitals, education/ schools, capacity building, energy, culture and infrastructure etc), Programme Grant (Rs 700 cr.) and the Small Development Projects (Rs 700 cr.). During his address to the Joint Session of the Bhutanese Parliament in May 2008, Prime Minister Dr. Manmohan Singh informed that the total bilateral economic engagement with Bhutan over the next five years to be of the order of Rs./ Nu. 100 billion. Some of the important projects being executed under the 10th Plan include construction of Supreme Court, strengthening of Constitutional Officers such as Royal Audit Authority, Election Commission, anti-Corruption Commission and Attorney General, renovation of major Dzongs, preparation of DPRs for major power projects, widening of major roads, scholarships and expansion of tertiary educational institutions. The regular Project Monitoring Committee (PMC) meetings and Plan Talks comprising concerned GoI and RGoB members are held regularly to monitor implementation of various projects.

13.   Mega Projects:In addition to the GOI assistance mentioned in the above para, GOI also provides support to Bhutan to develop various other developmental projects known as mega projects due to their size.

14.    Bilateral cooperation in the hydropower sector has been carried forward with the formal inauguration of the 60 MW Kurichhu Hydroelectric project in April 2006, and commissioning of the 170 MW first unit of 1020 TALA Hydroelectric Project in July 2006. All six units have been commissioned by end March 2007. GOI has agreed to provide assistance to Bhutan in developing the hydropower sector and to purchase at least 10,000 MW of power from Bhutan by 2020. For the purpose ten hydropower projects have been agreed during the first Empowered Joint Group (EJG) Meeting held in Delhi in March 2009. Of these 10 projects, the three projects – Punatsangchhu-I Hydro Electric Project, Punatsangchhu –II and Mangedechhu HEPs – are under construction. For 4 projects viz., the Kholongchhu HEP, Amochhu Reservoir, Wangchu RoR and Bunakha Reservoir projects, respective PSUs have submitted DPRs to the two governments for approval. For remaining 3 peojects - the Kuri Gongri HEP, the Chamkharchhu-I HEP and Sankosh Reservoir Hydroelectric Project (HEP) - DPRs are expected to be finalised by 2012.

15.    GOI is also committed to the establishment of a 1 million tonne cement project, Dungsum Cement Plant at Nganglam. The project is under construction and is expected to be operational by early 2012. During his visit to Bhutan Prime Minister Dr. Manmohan Singh announced the construction of the first ever rail link between India and Bhutan, connecting Hashimara to Phuentsholing, called the “Golden Jubilee Rail Line”. The technical studies on the alignment of the rail line have started. RITES has, however, encountered problems from the owners of Tea Gardens which fall on the proposed railway line. Ministry of Railways and Environment along with the Government of West Bengal are trying to resolve the issue. During PM’s visit to Bhutan in April 2010 for the 16th SAARC Summit, Prime Minister Dr. Manmohan Singh and the Prime Minister Jigmi Y. Thinley jointly laid the Foundation Stones for the Punatsangchhu –II and Mangdechhu Hydro Electric Projects (HEPs) and the Project ‘Bhutan Institute of Medical Sciences (BIMS)’, and launched the Project Implementation Document for the ICT Project “Chipen Rigphel – Enabling A Society, Empowering A Nation” (Total Solutions Project).

17.    India is not only Bhutan's main development partner but also its leading trade partner. A free trade regime exists between India and Bhutan. The India-Bhutan Trade and Commerce Agreement which expired in March 2005, has been renewed for a period of 10 years. Currently, the major items of exports from Bhutan to India are electricity (from Tala, Chukha and Kurichhu Hydroelectric Project), base metals and articles, minerals, vegetable fat and oils, alcoholic beverages, chemicals, cement, timber and wood products, cardamom, fruit products, potatoes, oranges and apples, raw silk, plastic and rubber products. Major exports from India to Bhutan are petroleum products, mineral products, base metals and articles, machinery, automobiles & spares, vegetable, nuts, spices, processed food and animal products, chemicals, wood, plastic and rubber. The Agreement on Trade and Commerce also provides for duty free transit of Bhutanese merchandise for trade with third countries. Sixteen exit/entry points in India identified in the Protocol for Bhutan's third country trade are: Jaigaon, Chamurchi, Ulta Pani, Hathisar (Gelephu), Darranga, Kolkata, Haldia, Dhubri, Raxaul, Panitanki, Changrabandh, Phulbari, Dawki, New Delhi, Chennai and Mumbai. Of these, Kolkata, Haldia, Mumbai and Chennai are the designated seaports, Dhubri is the riverine route, New Delhi, Chennai, Mumbai and Kolkata are the air routes and Raxaul is the rail route. The others are the designated road routes.

18.    India is not only Bhutan's main development partner but also its largest trade partner. During 2010, imports from India were of the order of Rs. 2930 crores and constituted 75% of Bhutan’s total imports. Bhutan’s exports to India in 2010 amounted to Rs. 2600 crores and constituted 90% of its total exports. Total trade in 2010 grew by about 26% from 2009.

[Rupees in Billion]
Year	2001	2002	2003	2004	2005	2006	2007	2008	2009	2010
Exports to Bhutan (Imports from India)	6.98	7.58	10.26	10.19	12.80	13.05	15.09	17.33	23.3	29.30
Imports from Bhutan (Exports to India)	4.70	5.13	5.92	7.76	9.97	14.48	22.72	21.48	20.5	26.0
Source:Royal Monetary Authority release

19.    Trade Talks: The India Bhutan Bilateral Trade Talks were held in New Delhi on 18-19 August 2011. The Bhutanese delegation was led by Mr. Sonam P. Wangdi, Director General, Department of Trade and included representatives from Ministries of Economic Affairs, Finance and Foreign Affairs. Indian delegation was led by Joint Secretary, Ministry of Commerce and included representatives from Ministries of Commerce, External Affairs and Finance. At the request of RGoB, GoI has agreed to the use of Dalu LCS (land custom station) and Ghasuapara LCS (both in Meghalaya) as additional exit/ entry points for Bhutan's trade with Bangladesh. Ghasuapara LCS will be used only as exit point for Bhutan for the present till the necessary infrastructure in place for it to be used as entry point also. In addition, 4 additional entry/ exit points for India-Bhutan bilateral trade – Upper Khogla (West Bengal), Dalmore or Birpara (West Bengal), Bokajuli (Assam) and Rangapani (Assam) – will also be notified by GoI. GoI also agreed to open two alternate routes to industrial estates in the border towns of Phuentsholing (from Highway at Bolan Chaupati, near Mangalabari in Jalpaiguri district (WB) to Alay village at border near Toribari/ Pasakha industrial estate of Bhutan) and Samdrup Jongkhar (road from Bokajuli in Daranga (Assam) up to Matanga industrial estate, Samdrup Jongkhar). The discussions are presently on with the concerned stakeholders for construction of these routes. Pursuant to these talks, GOI has issued notification allowing Bhutanese passengers duty free access at Indian airports, as well as exempting exports to Bhutan from any export bans in India on some essential items subject to limits.

20.    Several important economic and commercial conferences have been held in Bhutan to further our bilateral economic and commercial relations. Coinciding with the Coronation and centenary events a trade fair known as the 5th India Trade Show in December 2008 which witnessed participation by many Indian companies including from the North East. Other conferences include the South Asia Conference on Synergy and CME in November 2005 organized by AIIMS and a Seminar on ‘Public Private Partnership in Social Housing’ in June 2005 organized by HUDCO. Coinciding with the SAARC Car Rally a conference on ‘ICT for sustainable and inclusive development in SAARC’ was held in Thimphu on 19th March 2007. A Workshop for SAARC countries on Applications of Tele-health to Service Delivery in Public Health and Environment was organized by the Ministry of Health, RGoB in collaboration with the School of Telemedicine and Biomedical Informatics, Sanjay Gandhi Post Graduate Institute of Medical Sciences (SGPGIMS), Lucknow in Thimphu from 27-31 July 2009.

21.&bsp; Over 40 Indian companies, organised by the Indian Trade Promotion Organisation (ITPO), participated in the 9th SAARC Trade Fair held in Thimphu from 11-14 September 2009. About 50 Bhutanese and 45 Indian companies participated in the Bhutan-India Regional Friendship Trade Fair held in Gelephu from 8-12 January 2010. About 16 Indian and 13 Bhutanese companies in areas of automobiles, handlooms, handicrafts, electronics, furniture, agricultural products and food items participated in the 2nd Bhutan India Regional Friendship Trade Fair (BIRFTF) 2011 held from 28 January -1 February, 2011 in Phuentsholing. The 3rd Bhutan India Relation Friendship Trade Fair was held in Gelephu from 20-26 January 2012. Bhutanese companies participated in the 30th & 31st India International Trade Fair held in New Delhi in November 2010 and 2011. A Confederation of Indian Industries (CII) team of businessmen/industrialists visited Bhutan in July 2007 and in August 2009. A business delegation from Bhutan led by Secretary, Ministry of Economic Affairs, visited India on invitation of GOI in January 2008 to participate in the CII Partnership Summit in New Delhi. It also visited important business organisations and institutions in Mumbai, Bangalore and Kolkata. A seminar- cum-workshop on business opportunities in Bhutan was also organised in Delhi during the above visit. A Bhutanese delegation led by Secretary, MoEA, RGoB and comprising officials from MoEA, Tourism Council of Bhutan and Bhutan Chamber of Commerce & Industry visited Kolkata and Mumbai from September 28 to 2nd October, 2010 for conducting the Investment Road Show in order to attract Indian investors to invest in Bhutan following the recent release of RGoB’s Economic Development and revised FDI Policies. A 30 member delegation from NASSCOM visited Bhutan in November 2008 during which NIIT agreed to establish a Centre of Excellence at the College of Science and Technology in Bhutan and Infosys agreed to train 100 Bhutanese students every year. Druk-PNB, the first FDI joint venture bank in Bhutan with PNB holding 51 per cent in the joint venture, opened on January 27. A Construction Expo and Trade Expo (held by M/s Leo Advertising, India in collaboration with BCCI) were held in 2010. BCCI also organised 'Spring Consumer Expo' and '1st International Education Fair' in Thimphu in March/ April 2011, in which a number of Indian companies participated. About 50 Indian companies participated in the five-day international trade fair organized by the Bhutan Chamber of Commerce and Industry from 3-7 September 2010 in Thimphu. . Druk-PNB, the first FDI joint venture bank in Bhutan with PNB holding 51 per cent in the joint venture, opened on January 27. The first ever Young Presidents Organisation (YPO), Mumbai Chapter, and perhaps the most powerful ever business delegation was in Bhutan during April 7-10, 2011. A number of YPO members, especially involved in sectors like chemicals, tourism, education, etc. evinced keen interest for further follow up to concretize interaction with Bhutan. A 13-member CII delegation led by Mr. S. Sen, Principal Advisor, CII visited Bhutan from 21-23 July 2011. The companies were in areas of hydropower, tourism, agricultural equipment, food processing and quality, education and city waste management. The visit was organized by the Bhutan Chamber of Commerce and Industry (BCCI), as per the MOU signed between CII and BCCI. 9-member YPO (Young Presidents Organization), Mumbai Chapter delegation led by Shri Praful Patel, Hon’ble Minister of Heavy Industries and Public Enterprises, GoI visited Bhutan from 3-6 March 2012.

22.    There is close bilateral cooperation in the educational and cultural fields between India and Bhutan. India provides technical expertise and services of specialists to Bhutan in various fields. Government of India's scholarships are granted to 50 Bhutanese students both at undergraduate and postgraduate level every year in Indian Institutions of higher learning. Under the 10th Plan the undergraduate slots have been increased to 85 per year and postgraduate to 77. These GOI Scholarships are in addition to the ITEC /TCS of Colombo Plan (80 slots) training slots provided to Bhutan every year. Ambassador’s scholarships are granted to meritorious and deserving students for studies in India. Ten Bhutanese students are admitted to Sainik schools in India and all expenditure is borne by the GOI. During his visit to Bhutan, Prime Minister Dr. Manmohan Singh announced the government of India’s decision to institute a Nehru-Wangchuck Scholarship to encourage students from Bhutan to study in leading Indian universities and institutions, which has already been implemented for the present academic session.

23.     A large number of Bhutanese students study in Indian schools and colleges on private basis. To facilitate this, the Education Consultants of India Limited held a seminar- cum-counselling Session in Bhutan in May 2007 for the benefit of Bhutanese students desirous of pursuing further studies in India. Bhutan's Sherubtse College is affiliated to Delhi University. About 30 India-based lecturers are posted to this College under the TCS of Colombo Plan.

24.   The cooperation was not only limited to official exchanges between the two governments. The people-to-people contacts were also diversified. A five member Indian Ocean Band sponsored by the ICCR performed in Thimphu on 23rd May 2008 as part of Coronation and Centenary Celebrations in Bhutan and to mark the Golden Jubilee Year of Pandit Jawaharlal Nehru’s visit to Bhutan in 1958. A 38 member Pungcholam drummers group from Manipur choreographed by Astad Deboo performed during the coronation celebrations in Bhutan 0n 7th Nov 2008. Well known Indian rock band Parikrama performed at the centennial grounds in Thimphu on 26th November 2008 on India day. Friendly football matches between under-16 teams of India and Bhutan were also organised in Bhutan in November 2008 as part of coronation and centenary celebrations. The Embassy invited Manipuri and Odissi dance troupes to perform in Bhutan. Bhutan also participated in the First Exhibition of SAARC Museum of Textiles and Handicrafts (Textile Traditions of South Asia), Seminar – Festival of South Asian Folklore, SAARC Fusion of Music Bands, SAARC Food Festival and SAARC School Students and University Students Exchange Programme organized in December 2007. A Kathak dance troupe led by Mrs. Aditi Mangaldas invited by the Embassy in August 2009 gave performances at various places in Bhutan. The renowned sitarist Mr. Shujaat Hussain Khan and his troupe (sponsored by ICCR) gave performance at the Embassy auditorium on the occasion of Independence Day 2010. Kathak dance was performed by Sharmishtha Mukherjee and a photographic exhibition entitled 'Buddhism in India' by Sondeep Shankar was inaugurated at NWCC in Thimphu during the inauguration ceremony of NWCC on 21 September 2010.

25.    Nehru-Wangchuck Cultural Centre: Dr. Karan Singh, President, Indian Council for Cultural Relations (ICCR), GoI, and Lyonpo Minjur Dorji, Minister for Home and Cultural Affairs, RGoB jointly inaugurated the “Nehru-Wangchuck Cultural Centre” at Thimphu on Tuesday, 21st September 2010..

26.    India-Bhutan Foundation was established in August 2003 during the visit to India of the present King and the then Crown Prince with the aim to enhance people to people exchanges in the focus areas i.e. education, cultural exchanges and environment preservation. Ambassadors of Bhutan and India are the co-Chairpersons of India- Bhutan Foundation. GoI has contributed Rs 5 crore as main corpus amount for IBF with a matching contribution from RGoB. The last meeting of IBF was held in Bhutan in March 2012. IBF supported in holding of the first ever seminar between India and Bhutan on the Gross Nation Happiness (GNH) from 11-12 March in Thimphu. The seminar was organized by the Centre for Bhutan Studies (CBS) and Seminar Education Foundation (SEF) of India. India-Bhutan Foundation also sponsored a Literary Festival “Mountain Echoes”, which was organized by ‘Siyahi’, a leading literacy consultancy in India in Bhutan from 17-20 May, 2010. This was the first ever India-Bhutan Literary Festival, in which leading authors, publishers and poets from both sides including renowned personalities such as Gulzar, Chetan Bhagat, Sanjay Hazarika, Patrick French etc participated. The Festival was inaugurated by Her Majesty, the Queen Mother, and Prime Minister of Bhutan Lyonchen Jigmi Y. Thinley delivered the key note address focusing on GNH. The second and third series of the Literary Festival “Mountain Echoes” were held in Bhutan from 20-24 May 2011 and 20-24 May 2012.

27.    The institutional cooperation has been formalised through signing of an MoU between the two Election Commissions during the visit of our Chief Election Commissioner in May 2006. Chief Election Commissioner of Bhutan visited India earlier in Feb 2006 and recently in January 2010 and May 2009. Several teams of officials from the Election Commission of Bhutan including Dzongdas (District Collectors) and Dzongkhag (district) officials have visited India to observe various state and local elections. India has extended full assistance to Bhutan in formulating its election laws.

28.    Government of India also provided a grant of Rs 47.506 million to Royal Government of Bhutan to source electronic voting machines from India. Several Election Observers from India visited Bhutan during the National Council Elections and two rounds of mock elections. Government of India also provided helicopters during the National Council elections to transfer election officials and equipment to remote areas.

29.    MOU for cooperation between the Election Commissions of India and Bhutan was renewed during the visit to Bhutan by CEC D. S.Y. Quraishi. Chief Election Commissioner, Shri Navin Chawla visited Bhutan in October 2009. A four member delegation from the Election Commission of India led by Chief Election Commissioner, Shri N. Gopalaswami visited Bhutan to observe the National Assembly Elections in March 2008. Shri Shyam Saran, Special Envoy of Prime Minister and former Foreign Secretary, and Shri Salman Haider former Foreign Secretary visited Bhutan as Election Observers from the GoI in March 2008.

30.    The Government of India also facilitated holding of a workshop in Thimphu for senior bureaucrats in Bhutan on ‘Democratic Constitutional Monarchy’ with eminent civil servants from India acting as resource persons. Specific Election Coverage Training programmes were also organized for journalists from both public and privately owned media in Bhutan with the help of External Publicity Division which was well appreciated in Bhutan. Two (2) returning officers and 2 electoral registration officers from the Election Commission of Bhutan visited Uttar Pradesh to observe the sixth phase of UP Assembly elections from 27 February to 1 March 2012.

31.    The officials of the Bhutanese Parliament have been attending various training programmes conducted by the Bureau of Parliamentary Studies and Training (BPST) in the Indian Parliament. BPST has also organized Orientation Programmes for Members of the Bhutanese Parliament. Speaker of the Bhutanese Parliament Lyonpo Jigme Tshultim visited India during August-September 2008. During the visit, he extended an invitation to our Speaker to visit Bhutan. Speaker, Lok Sabha, Smt. Meira Kumar, led an Indian Parliamentary delegation to Bhutan from 26-29 May 2010. The delegation included the Leader of Opposition, Smt. Sushma Swaraj, Dr. (Kum). Girija Vyas, MP, Shri Vishwa Mohan Kumar, MP and Secretary General and other officials from Lok Sabha Secretariat. This was the first visit of an Indian Speaker to Bhutan. During the visit, it was agreed to constitute a Parliamentary Friendship Group to promote regular exchange of Parliamentarians from both the sides. The speaker attended the opening ceremony of the 5th session of Parliament of Bhutan and addressed the Joint Session of Parliament. Both sides agreed to sign an MOU on Parliamentary cooperation. Parliamentary Friendship Groups have been formed in the Parliaments of both countries. Bhutanese Speaker visited India from 9-12 July 2011 for SAARC Speaker's Conference. An MOU between the two Parliaments has been signed between the two sides during the visit of Bhutanese Speaker to India from 23-26 Nov 2011. A delegation of Bhutanese National assembly's Poverty Reduction Committee visited Bihar and Arunachal Pradesh in Feb 2012.

32.     Foreign residents / workers in Bhutan are estimated at about 37,000 (RGOB figures), the bulk of which are Indian nationals, excluding day workers which number around 7000. June 2012