Dr Medha Bisht is Senior Assistant Professor at the Department of International Relations, South Asian University, New Delhi; and former Associate Fellow, Manohar Parrikar IDSA.Click here for detailed profile.
The year 2013 started on a high note for India-Bhutan relations. While the Indian External Affairs Minister, Salman Khurshid, was on an official visit to Thimpu on January 14, 2013, Bhutan’s fifth king, Jigme Khesar Namgyel Wangchuk, graced the chair of the chief guest on the Indian Republic Day. Even though the official visit has not been made public to media scrutiny, certain politically significant issues relevant for India-Bhutan relations perhaps need to be reckoned with. These are economic relations, Bhutan’s relations with China and the internal security concerns of both India and Bhutan.
If one were to cast a brief look at India-Bhutan economic relations, India today stands as Bhutan’s biggest development partner. In 2011, bilateral trade reached Rs. 61.6 billion, which constituted 72 per cent of Bhutan’s total imports and 85 per cent of its exports. Significantly, almost 70 per cent of Bhutan’s total trade is with India. Meanwhile, the latest available statistics (2011) reveal that a large chunk of the developmental budget of India’s Ministry of External Affairs goes to Bhutan. According to the Budget Report of the Ministry of External Affairs, Bhutan is one of the principal beneficiaries of loans and aid from India, receiving almost Rs. 1723 crore for the year 2010-2011. Most of this money goes into addressing Bhutan’s development targets, and this would have found top priority in the official parleys over the past week. As Salman Khurshid succinctly put it during the media interaction on January 25, 2013, the process of working with Bhutan on the latter’s “Eleventh Plan and consultations” is under progress.
Another major economic issue is the nature of power trade between the two countries. According to the 2011-2012 Annual Report of Bhutan’s Royal Monetary Authority, export earnings from the power trade have steadily increased and the Druk Green Power Corporation ranked as the highest contributor for the country’s tax revenues in 2011-2012. While this issue is of some economic significance to Bhutan, of late there has been some concern about the financing of hydel power projects. Though these fears were allayed by Salman Khurshid during his visit to Thimpu on January 14, 2013, the King’s visit is likely to have seen further assurances being conveyed.
The China factor is likely to have been another issue of discussion between the two countries. While Bhutan has not made official comments on establishing diplomatic relations with China, Bhutan’s democratic opening has led to increased domestic articulations about the benefits of formal relations with China. The significance of this factor came out in the open in July 2012 when a certain tender, routinely given to a company that supplied Indian vehicles, was instead given to another company named Global Traders and Gangjung, which is a supplier of Chinese vehicles. Given that the company’s owner was the Bhutan prime minister’s son in law, the episode indicated Bhutan’s interest in Chinese goods and also revealed China’s influence over various stakeholders in Bhutan’s domestic politics. As the process of democratisation takes root in Bhutan, there will be certain sections wanting bilateral relations with China. In fact, there are already domestic pressures to establish ‘limited economic ties’ with China. It is argued by Bhutanese businessmen that goods imported from the Kolkata port have high transactional cost and that the costs of some goods could well be reduced if goods were instead imported through the country’s North-Western border via Tibet. However, any decision on this front would require tampering with the protracted Sino-Bhutan boundary dispute. Pressure groups in Bhutan, particularly from its North-Western region, have also been insisting upon resolving the boundary dispute for a long time. Given the strategic weight of the issue which raises security concerns for India, the Indian linkage is seen as protracting the final resolution of the boundary dispute.
Internal security issues are the third significant factor to occupy some priority in discussions between India and Bhutan. While there have been occasional incidents of IED blasts in Bhutan in 2012, such episodes could increase in the coming months. Also, there have been reports about the increased activity of insurgent groups across the India-Bhutan border. While Bhutanese officials claim that zero-tolerance and hot pursuit is exercised when it comes to the question of insurgents influxing into Bhutan, it has been reported by various media sources that the Paresh Barua faction of the United Liberation Front of Asom is relocating bases to Bhutan. While such activities have been raising alarm bells in Bhutan, the import of these issues for discussion is highlighted by the King’s itinerary, which included a meeting with India’s National Security Advisor and Home Minister.
While these are the broad contours of some important contemporary issues between India and Bhutan, the King’s visit is a step towards cementing the political relationship further. The King has been quoted in the Indian media as saying that “the destiny of Bhutan is intimately bound with that of India and it is in our mutual interests to further the bonds of friendship and understanding.” The ‘destiny’ referred to by the King points to the geographical location of Bhutan, which underlines the geo-political significance of India as Bhutan’s facilitator to South and South-East Asia. Bhutan is an important country in India’s neighbourhood. Given its strategic significance, the country should not be taken for granted by India. India needs to respond sensitively to its Himalayan neighbour, a move which will help create further goodwill in the long term.
Medha Bisht is Assistant Professor, Department of International Relations, South Asian University, New Delhi. She can be contacted at medha.bisht@gmail.com.
Views expressed are of the author and do not necessarily reflect the views of the IDSA or of the Government of India.
Jigme Khesar Namgyel Wangchuk’s Visit to India: Towards an Assuring Alliance
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The year 2013 started on a high note for India-Bhutan relations. While the Indian External Affairs Minister, Salman Khurshid, was on an official visit to Thimpu on January 14, 2013, Bhutan’s fifth king, Jigme Khesar Namgyel Wangchuk, graced the chair of the chief guest on the Indian Republic Day. Even though the official visit has not been made public to media scrutiny, certain politically significant issues relevant for India-Bhutan relations perhaps need to be reckoned with. These are economic relations, Bhutan’s relations with China and the internal security concerns of both India and Bhutan.
If one were to cast a brief look at India-Bhutan economic relations, India today stands as Bhutan’s biggest development partner. In 2011, bilateral trade reached Rs. 61.6 billion, which constituted 72 per cent of Bhutan’s total imports and 85 per cent of its exports. Significantly, almost 70 per cent of Bhutan’s total trade is with India. Meanwhile, the latest available statistics (2011) reveal that a large chunk of the developmental budget of India’s Ministry of External Affairs goes to Bhutan. According to the Budget Report of the Ministry of External Affairs, Bhutan is one of the principal beneficiaries of loans and aid from India, receiving almost Rs. 1723 crore for the year 2010-2011. Most of this money goes into addressing Bhutan’s development targets, and this would have found top priority in the official parleys over the past week. As Salman Khurshid succinctly put it during the media interaction on January 25, 2013, the process of working with Bhutan on the latter’s “Eleventh Plan and consultations” is under progress.
Another major economic issue is the nature of power trade between the two countries. According to the 2011-2012 Annual Report of Bhutan’s Royal Monetary Authority, export earnings from the power trade have steadily increased and the Druk Green Power Corporation ranked as the highest contributor for the country’s tax revenues in 2011-2012. While this issue is of some economic significance to Bhutan, of late there has been some concern about the financing of hydel power projects. Though these fears were allayed by Salman Khurshid during his visit to Thimpu on January 14, 2013, the King’s visit is likely to have seen further assurances being conveyed.
The China factor is likely to have been another issue of discussion between the two countries. While Bhutan has not made official comments on establishing diplomatic relations with China, Bhutan’s democratic opening has led to increased domestic articulations about the benefits of formal relations with China. The significance of this factor came out in the open in July 2012 when a certain tender, routinely given to a company that supplied Indian vehicles, was instead given to another company named Global Traders and Gangjung, which is a supplier of Chinese vehicles. Given that the company’s owner was the Bhutan prime minister’s son in law, the episode indicated Bhutan’s interest in Chinese goods and also revealed China’s influence over various stakeholders in Bhutan’s domestic politics. As the process of democratisation takes root in Bhutan, there will be certain sections wanting bilateral relations with China. In fact, there are already domestic pressures to establish ‘limited economic ties’ with China. It is argued by Bhutanese businessmen that goods imported from the Kolkata port have high transactional cost and that the costs of some goods could well be reduced if goods were instead imported through the country’s North-Western border via Tibet. However, any decision on this front would require tampering with the protracted Sino-Bhutan boundary dispute. Pressure groups in Bhutan, particularly from its North-Western region, have also been insisting upon resolving the boundary dispute for a long time. Given the strategic weight of the issue which raises security concerns for India, the Indian linkage is seen as protracting the final resolution of the boundary dispute.
Internal security issues are the third significant factor to occupy some priority in discussions between India and Bhutan. While there have been occasional incidents of IED blasts in Bhutan in 2012, such episodes could increase in the coming months. Also, there have been reports about the increased activity of insurgent groups across the India-Bhutan border. While Bhutanese officials claim that zero-tolerance and hot pursuit is exercised when it comes to the question of insurgents influxing into Bhutan, it has been reported by various media sources that the Paresh Barua faction of the United Liberation Front of Asom is relocating bases to Bhutan. While such activities have been raising alarm bells in Bhutan, the import of these issues for discussion is highlighted by the King’s itinerary, which included a meeting with India’s National Security Advisor and Home Minister.
While these are the broad contours of some important contemporary issues between India and Bhutan, the King’s visit is a step towards cementing the political relationship further. The King has been quoted in the Indian media as saying that “the destiny of Bhutan is intimately bound with that of India and it is in our mutual interests to further the bonds of friendship and understanding.” The ‘destiny’ referred to by the King points to the geographical location of Bhutan, which underlines the geo-political significance of India as Bhutan’s facilitator to South and South-East Asia. Bhutan is an important country in India’s neighbourhood. Given its strategic significance, the country should not be taken for granted by India. India needs to respond sensitively to its Himalayan neighbour, a move which will help create further goodwill in the long term.
Medha Bisht is Assistant Professor, Department of International Relations, South Asian University, New Delhi. She can be contacted at medha.bisht@gmail.com.
Views expressed are of the author and do not necessarily reflect the views of the IDSA or of the Government of India.
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