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Bhutan 2010: Foreign Policy Developments

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.
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  • December 30, 2010

    If one looks at the pattern of continuity and change in Bhutan’s foreign policy in 2010, perhaps not much has changed. India–Bhutan relations continue to follow a positive trajectory and over the past few years bilateral relations have evolved into a comprehensive partnership encompassing a wide range of issue areas. While hydro-power tops the list in development cooperation, information and intelligence sharing along with hot pursuit of North East militant groups trying to establish bases in Southern Bhutan, have made Indo-Bhutan relations exemplary in the otherwise turbulent neighbourhood.

    While the year began with the nineteenth round of border talks between Bhutan and China on January 2010, a significant development was the focus on the disputed claim line in North Western Bhutan. With the third Expert Group Meeting held on 16-18 July 2010 in Beijing, revelations were made that “due to the existing differences of views and positions” along the Sino-Bhutan border no settlement on the border issue could be reached. While the next round of talks are reportedly slated to be held in Hong Kong, domestic pressures in Bhutan to settle the border dispute have been mounting for some time.

    The year was a special year for Bhutan as it hosted the sixteenth SAARC summit in Thimpu. Not only did Bhutan successfully showcase itself to the outside world but also made special efforts to forge some consensus on the issue of Climate Change. The SAARC development fund was officially launched on April 29, 2010 at Thimpu, which is also the permanent Secretariat of SDF. Climate change is one of the growing priority areas in Bhutan, given that glacial lake outburst floods can wreak major environmental disaster on Bhutan in the years to come. At present there are 2794 glacial lakes in Bhutan, out of which twenty-five have been identified as potentially dangerous.

    As Bhutan’s foreign policy is deeply integrated with its economic policy, preparations are underway to expand and liberalize investment policies. At the domestic level the Foreign Direct Investment (FDI) Policy and the Economic Development Policy were released. The policy emphasized the objective of achieving economic self-reliance by the year 2020. Cultivating ‘Brand Bhutan Image’ along with environmental conservation has been delineated as one of the top most priorities in Bhutan’s economic development policy. The brand image of Bhutan through the prism of Gross National Happiness seems to be a long term policy goal. Owing to the electricity generated from hydro-resources, the construction sector has become the second largest contributor to the GDP. Environmental preservation along with inclusive economic growth will be one of the challenges for Bhutan to cope with, especially as urbanization also seems to be moving at a fast pace.

    A significant issue with regard to bilateral interaction with Bangladesh in 2010 was the transit issue. Bangladesh would be providing transit facilities to Bhutan, by opening up its Mongla port. Meanwhile Banglabandha land port will be used as an entry and exit point for Bhutanese transit goods. In order to expedite developments on this front an inter-ministerial meeting is slated to be held to discuss the Draft Agreement on Transit between the two countries. Bhutan for its part has also agreed to export around 1000 MW of power to Bangladesh. Sub-regional diplomacy thus could soon take place between Bhutan, Bangladesh, Nepal and India. India meanwhile could utilize this opportunity to initiate a grid linking plan engaging all the concerned countries in order to reap full benefits of this burgeoning sub-regional diplomacy.

    While promising as these developments appear to be, some steps could perhaps be taken in order to take the Indo-Bhutan relationship forward.

    First, Bhutan should develop a paramilitary force along its border areas, so that security cooperation with India can be further strengthened.

    Second, the present development partnership between Bhutan and India should be directed to a strategic one, given that there are growing concerns in India regarding the land for land exchange proposition of the Chinese. The fact that the North-Western sector is particularly important for India’s security concerns should be conveyed to the Bhutanese establishment. Reciprocity on crucial sectors has in some ways governed the Indo-Bhutan relationship and this spirit should be taken forward.

    Third, India, Bhutan, and Bangladesh should work together on streamlining policies which can mitigate the impact of climate change in the sub-continent. This is important as Assam and Bangladesh, as lower riparians, would be severely affected by flash floods emanating from the glaciers of Bhutan. Thus climate change should be an issue area which should get the attention of these countries in the coming months and years.

    Bhutan and India have shared an excellent relationship which needs to be cultivated, developed and nurtured. Security and development cooperation have become the twin pillars of their relationship. The way the two countries take this relationship forward taking local perceptions into account would therefore be the litmus test of diplomacy for both countries.