Challenges in relation b/w India and Bhutan

  • Ties came under strain in recent times over India’s sudden change in its power purchasing policy, rigid rates and refusal to allow Bhutan to join the national power grid and trade with third countries like Bangladesh. A clause that required the exporting power generation company to be majority owned by an Indian entity created friction. However, these are being addressed now.
  • There are concerns in Bhutan with regard to the environmental risk because of trade, transport and tourism.
  • India’s plans for a Motor Vehicle Agreement in the Bangladesh-Bhutan-India-Nepal grouping are held up.
  • Bhutanese proposal to levy entry charges on Indian tourists could cause differences with India.
  • Earlier generations of Bhutanese students never looked beyond India, but in recent years young Bhutanese have shown a preference for education in places like Australia, Singapore and Thailand.
  • There are high-level visits from countries like China and USA.