Embassy of IndiaThimphu

Bhutan in MEA Annual Report for the year 2021-22

A. Excerpts from Ministry of External Affairs Annual report related to Bhutan

The bedrock of mutual understanding and respect, shared cultural heritage, and strong people to people links is the hallmark of the special and unique partnership between India and Bhutan. The multifaceted and mutually beneficial relationship between the two countries continued to flourish ver the course of the year, with traditional areas of growth being strengthened as new areas of cooperation developed.

High Level Exchanges

The tradition of high-level exchanges continued even though cross-border travel was impacted by the COVID pandemic. Prime Minister had a telephone conversation with the Prime Minister of Bhutan, Lyonchhen Dr. Lotay Tshering on 11 May 2021. The two leaders expressed solidarity in each other’s efforts to combat the COVID pandemic and noted that the present crisis had further strengthened he special friendship between India and Bhutan.

India’s Minister for Environment, Forest and Climate Change and Bhutan’s Foreign Minister Dr. Tandi Dorji were signatories to the bilateral Memorandum of Understanding on Cooperation in the Areas of Environment, concluded in a virtual signing ceremony held on 18 June 2021, which renewed cooperation and collaboration while also expanding it to new areas in this important field. Collaborative activities envisaged under the MoU include technical assistance, capacity building, exchange of knowledge, best practices and technology transfer, exchange visits by experts, scholars and delegations, projects and seminars, with a Joint Working Group constituted to identify the specific areas of cooperation. BHIM UPI was launched in Bhutan on 13 July 2021 jointly by Finance Minister of India and Finance Minister of Bhutan Lyonpo Namgay Tshering, fulfilling a commitment made in the Joint Statement issued during Prime Minister’s visit to Bhutan in August 2019. With the launch Bhutan became the first foreign country to adopt UPI standards for its QR deployment and the first country in the immediate neighbourhood to accept mobile-based payments through the BHIM app. The launch of BHIM UPI in Bhutan builds on the success of the RuPay project and further deepens the economic and financial linkages between India and Bhutan.

Development Partnership

The 3rd Bhutan-India Development Cooperation Talks under the 12th Five Year Plan of Bhutan were held in June 2021 to oversee the implementation and allocation of India’s commitment of Rs. 4500 crore Plan Assistance and Rs. 400 crore of Transitional Trade Support Facility (TSF). During the talks, India agreed to provide support to 9 new priority projects of Bhutan, including the Water Flagship Project and Waste Management Project. From 1 April 2021 to 31 October 2021, Government of India has released an amount of INR 496.53 crore towards Project Tied Assistance (PTA), High Impact Community Development Projects (HICDP), Program Grant and TSF.

Key highlights of Government of India’s Plan Assistance to Bhutan during the period include the INR 110 crore Health Flagship Program of Bhutan, a Government of India funded PTA (Project Tied Assistance) Project launched in March 2021 to reduce the incidence of mortality on account of Gastric, Cervical and Breast cancers through provision of screening facilities and capacity building for health care officials in Bhutan, and the state of the art Mother and Child Hospital in

Mongar, being constructed at a cost of INR 68.1 crore through Government of India’s PTA for the 12th Five Year Plan of Bhutan.

Hydropower Cooperation

Hydropower cooperation is an important area of bilateral cooperation, allowing Bhutan’s vast hydropower potential to India's Neighbours be tapped for mutual benefit. Jointly developed hydropower capacity now stands at 2136 MW. Some of the projects have also been recognized for their positive contributions to the local economy and communities, with a ceremony for the handing over of the prestigious Brunel Medal for excellence in civil engineering, research and innovation awarded by Institution of Civil Engineers, London to the jointly constructed Mangdechhu Hydroelectric Project Authority (MHPA) held in Thimphu on 5 August 2021 and attended by Lyonpo Loknath Sharma, Minister of Economic Affairs of Bhutan.Both governments continued to coordinate on the ongoing projects, including holding of the Authority Meetings for Punatsangchhu-II Hydro Project and Mangdechhu Hydro Project on 21 and 22 September 2021, last held in September 2019. Kholongchhu HEP is also making progress with the award of contracts for its civil works.

Education and Capacity Building

Bilateral cooperation in the area of education with a focus on Science, Technology, Engineering and Mathematics (STEM), in line with Bhutan’s priorities, continued through the year 2021-22. Over 950 scholarships are provided annually by Government of India for Bhutanese students to study in India in a wide range of disciplines. This includes the prestigious Nehru-Wangchuck Scholarship providing 8 slots annually, 20 annual slots under the ICCR Scholarship,,the Ambassador’s Scholarship and the Nalanda University,Scholarship. Three Bhutanese students secured admission to M. Tech programmes at the Indian Institute of Technology (IIT), Kanpur and received the India-Bhutan Friendship Scholarship for 2021-2022. Another was awarded a Global Fellowship by IIT, Gandhinagar. A group of 30 Tour Guides and officials from the Tourism Council of Bhutan underwent a month-long online introductory-level Hindi language training programme conducted by the Mahatma Gandhi International Hindi University, Wardha.

India continued to partner Bhutan in the capacity building of its government officials, with over 200 slots utilized by Bhutanese nationals for training opportunities through the Ministry’s e-ITEC training programmes. A customized 14- week intensive e-ITEC Training Programme on Contemporary Legal Issues was also conducted by the National Law University, Jodhpur for Bhutanese Judges and judicial officers during the year.

Cooperation in New and Emerging Areas

New areas of cooperation are being identified, constantly diversifying and giving fresh impetus to the multifaceted ties between the two countries. Space technology is one such area where bilateral ties have progressed in accordance with the vision of Prime Minister and His Majesty the King of Bhutan. On 24 September 2021, a virtual signing ceremony for the Implementing Arrangement between Indian Space Research Organisation (ISRO) and Department of Information Technology and Telecom on the Joint Development of a Small Satellite for Bhutan was held at the Ministry of Information and Communication, Royal Government of Bhutan. Pursuant to the Agreement, a team of Bhutanese space engineers from the Department of Information Technology and Telecom, under the Ministry of Information and Communications of Bhutan, underwent training in UR Rao Satellite Centre (URSC) in Bengaluru from November 2021. A suitable date for the launch of the satellite is being explored in the first quarter of 2022.

The inaugural capacity building program conducted by Telecom Regulatory Authority of India (TRAI) was held for officials of the Bhutan InfoComm and Media Authority (BICMA), in July 2021, covering emerging technologies such as 5G, Artificial Intelligence, Internet of Things, Augmented Reality and Virtual Reality.

Trade and Economic Cooperation

India remains Bhutan’s largest trading partner. In 2020-21, the bilateral trade reached around USD 1083 million, of which, India’s exports to Bhutan comprised USD 694 million and India’s imports from Bhutan amounted to USD 389 million. Both governments continued to engage in taking measures to facilitate trade and mutual investments. Government of India permitted the import of seven fresh vegetables – viz. chilli, beans, cabbage, cauliflower, carrot, peas, and soyabean – from Bhutan into India through the plant quarantine station at Jaigaon on the India-Bhutan border with effect from 14 July 2021. Further, to help Bhutan deal with INR shortages, Government of India extended the RGoB also availed two Standby Credit Facilities (SCFs) of Rs. 300 crore and Rs. 400 crore respectively at 5% per annum provided by the Government of India, which were due to expire in December 2021 and June 2022 respectively. The same have now been extended at a revised interest rate of 2.5% per annum. The Royal Monetary Authority of Bhutan also enjoys Currency Swap Facility of upto USD 200 million with the Reserve Bank of India under the Framework on Currency Swap Arrangement for SAARC Countries.

The Commerce Secretary Level meeting between India and Bhutan on trade and transit issues was held in New Delhi on 03 November 2021. The Indian delegation was led by Commerce Secretary and the Bhutanese delegation was led by Dasho Karma Tshering, Economic Affairs Secretary. The two co-chairs exchanged letters to formalize seven additional entry/exit points for trade between India and Bhutan, viz. (I) Nagarkata Land Customs Station; (ii) Agartala Land Customs Station; (iii) Pandu port; (iv) Jogighopa port; (v) Asian Highway 48 connecting Torsha Tea Garden in India and Ahllay in Bhutan; (vi) Kamardwisa; and (vii) Birpara.

A virtual startup mentorship program for Bhutanese entrepreneurs titled ‘Ignite’, was organised in collaboration with the Department for Promotion of Industry and Internal Trade of India, Invest India, Startup India, and TiE Delhi-NCR. The virtual sessions were held from October 2021 to January 2022, providing over 150 Bhutanese entrepreneurs the opportunity to be mentored by Indian startups.

Cooperation during COVID pandemic

In line with the exemplary relations between India and Bhutan and in keeping with assurances made by Prime Minister to Bhutan as a close friend and neighbour, Government of India ensured continuous supply of essential items to Bhutan despite the disruptions caused by the COVID pandemic. Following the first tranche of 150,000 Covishield vaccines delivered to Bhutan in January 2021, another 400,000 vaccines were sent as grant assistance to Bhutan in March 2021. The thirteenth medical consignment containing six (06) units of portable digital X-ray machines was handed over to the Royal Government of Bhutan on 3 May 2021.

Cultural and People-to-People Linkages

India and Bhutan share the glorious cultural tradition of Buddhism. These linkages have been kept alive and further deepened through bilateral cooperation in this field. A bronze statue of Lord Buddha, commissioned by ICCR, was gifted to Government and people of Bhutan, which was enshrined at the prestigious Tashichho Dzong monastery on 20 June 2021, coinciding with the birth anniversary of Guru Rinpoche.

Vibrant people-to-people ties are a hallmark of the warm and friendly relations between India and Bhutan. A slew of India@75 Amrit Mahotsav cultural events were organized by Embassy of India, Thimphu in partnership with Bhutanese organizations, including nationwide quiz and art competitions, panel discussions and sporting events that saw active participation from all sections of society in Bhutan. Four Bhutanese youth leaders participated in the Gen-Next Democratic Network Programme organized by ICCR from 25 November to 2 December 2021.

Miscellaneous

Two diplomats from Bhutan attended the six-month Induction Training Programme (ITP) along with IFS officer-trainees of the 2020 batch from 21 December 2020 – 11 June 2021.

B. Budget allocation to Bhutan under Technical and Economic Cooperation

C. List of MoUs signed between India and Bhutan in 2021-22

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