India- Bhutan Relations

• Bhutan – Buffer state in British time
• For much of its history, Bhutan has preserved its isolation from the outside world, staying out of international organisations and maintaining few bilateral relations.
• Bhutan became a protectorate of British India after signing a treaty in 1910 allowing the British to "guide" its foreign affairs and defence.
• Bhutan was one of the first to recognise India's independence in 1947 and both nations fostered close relations, their importance augmented by the annexation of Tibet in 1950 by the People's Republic of China and
• China’s border disputes with both Bhutan and India, made Bhutan to be central to its "Himalayan frontier" security policy.
• On August 8, 1949 Bhutan and India signed the Treaty of Friendship, calling for peace between the two nations and non-interference in each other's internal affairs. (Bhutan is protector state of India).
• However, Bhutan agreed to let India "guide" its foreign policy and both nations would consult each other closely on foreign and Defence affairs.
• The treaty also established free trade and extradition protocols.
• Scholars regard the effect of the treaty is to make Bhutan into a protected state, but not a protectorate, because Bhutan continues to have the power to conduct its own foreign policy.
• The occupation of Tibet by Communist China brought both nations even closer.
• In 1958, the then-Indian Prime Minister Jawaharlal Nehru visited Bhutan and reiterated India's support for Bhutan's independence and later declared in the Indian Parliament that any aggression against Bhutan would be seen as aggression against India an Defence of the territorial uprightness and frontiers of Bhutan was the responsibility of the Government of India.
• Despite good relations, India and Bhutan did not complete a detailed demarcation of their borders until the period between 1973 and 1984.
• Although relations remained close and friendly, the Bhutanese government expressed a need to renegotiate parts of the treaty to enhance Bhutan's sovereignty.
• Unlike in Nepal, where its 1950 treaty with India has been the subject of great political controversy and nationalist resentment because of Indian immigrants in Nepal, the nature of Bhutan's relationship with India has not been affected by concerns over the treaty provisions.
• From 2003 to 2004, the Royal Bhutanese Army conducted operations against anti-India insurgents of the United Liberation Front of Assam (ULFA) that were operating bases in Bhutan and using its territory to carry out attacks on Indian soil.
• India re-negotiated the 1949 treaty with Bhutan and signed a new treaty of friendship in 2007.
• The new treaty replaced the provision requiring Bhutan to take India's guidance on foreign policy with broader sovereignty and not require Bhutan to obtain India's permission over arms imports.
• India built hydropower project and buy electricity for North eastern state.

Border Management:

• There is a Secretary-level mechanism on border management and security related matters between the two countries.
• There is also a Border District Coordination Meeting (BDCM) Mechanism between the bordering States and the Royal Government of Bhutan (RGoB) to facilitate coordination on border management and other related matters.

Doklam Standoff.

• It started when Indian Army objected a road construction by the People’s Liberation Army of China in the Doklam plateau.
• China claims it to be a part of its Donglang region.
• However, both India and Bhutan recognize it as Doklam and consider it to be a Bhutan territory.
• India accused the Chinese of destroying its bunkers and China accused Indian troops of entering into its territory.
• China stopped the passage of pilgrims toward Kailash-Mansarovar through the Nathu La pass in Sikkim.
• Both India and China increased the presence of their troops and there was a standoff between the two armies.
• Later there was the withdrawal of troops from Doklam.

Why India is interested?

• Bhutan and India have a very cordial relationship were as Bhutan and China do not have formal relations.
• Bhutan has a very strategic position considering India’s geography.
• To foster the relationship, India and Bhutan signed a ‘Friendship Treaty’ in 2007 that commits India to protect Bhutan’s interests and the close coordination between the two militaries.
• Also, India is worried that if the road is completed, it will give China greater access to India’s strategically vulnerable “chicken’s neck” (Siliguri Corridor) that links the seven north eastern states to the Indian mainland.

Bhutan’s significance for Indian Foreign Policy

A trusted partner

• India Bhutan ties are governed by 1949 Friendship Treaty (amended in 2007)
• Bhutan stands out as an exception in South Asia as a country whose relations with India do not oscillate between China and India based on the party in power.
• Similarly, India has shown its respect by visiting Bhutan first on the state visit or standing beside Bhutan during Dokhlam crisis.
• Both countries have stood the test of good neighbourly relations.

Strategic Relevance

• Bhutan acts as a buffer between two big powers that is India and China.
• The Chinese claims on Ladakh, Nepal, Sikkim, Bhutan and Arunachal 5 finger policy jeopardizes Indian and Bhutanese sovereignty.
• Thus, for both Bhutan and India it is imperative to avoid such territorial claims together.

Economic overlapping:

• India continues to be the largest trade and development partner of Bhutan.
• India has contributed generously towards latter’s Five Year Plans since 1961.

Cooperation in hydropower

• The cooperation has over the years intensified as main pillar of economic ties and has evolved to become Bhutan’s major export item.
• The hydro relations have benefitted India to tackle it energy deficiency.
• The three hydropower projects developed with Indian assistance have already been completed: Tala Hydroelectric Project, Chukha Hydroelectric Project and Kurichhu Hydroelectric.

Educational and Cultural Cooperation:

• A large number of college going Bhutanese students study in India. Government of India provides number of scholarships to Bhutanese students.
• Regular cultural exchanges take place between the two countries. One of the basic objectives of India Bhutan Foundation established in 2003 is to enhance people to people exchange in cultural field. Indian Community:
• About 60,000 Indian nationals live in Bhutan, employed mostly in the hydro-electric power construction and road industry.
• In addition, around 8000-10,000 daily workers enter and exit Bhutan every day in border towns.

Multilateral Partnership:

• Both India and Bhutan are founding members of South Asian Association for Regional Cooperation (SAARC) that deals with economic, social and cultural development of South Asian Region.
• Both of them also share other multilateral forums such as BBIN (Bangladesh, Bhutan, India, and Nepal), BIMSTEC (Bay of Bengal Initiative for Multi Sectoral Technical and Economic Cooperation) etc.

Challenges

• Delays in constructing and commissioning in Bhutan by Indian companies have led to the country’s burgeoning national debt.
• India’s power-surplus status and the advent of other renewable energies like wind and solar power will make it more difficult for Bhutan to ensure that its hydropower sector becomes profitable.
• Unless India finds ways to help, it will be accused of the same sort of “debt-trapping” that China is accused of today.
• The goods and services tax still hurts Bhutanese exporters, and demonetisation has left lasting scars on the banking system.
• Government’s decision to cut cooking gas subsidy just before the 2013 elections in Bhutan has often been shown as proof of Indian interference.
• The Bhutanese Parliament didn’t ratify the implementation of BBIN project which will further affect the connectivity. Citing environmental concerns as reasons.

Way Forward

• Recalibrating the friendship: It has to build Bhutan’s trust on India’s intention by following the treaty in letter and spirit and not on a chose and pick basis.
• Strategic balancing: Bhutan and India bilaterally should look at all matters of territorial incursions. India needs to develop a standalone Bhutan policy that is independent of Chinese lens.
• India should try as much as possible to remain out of Bhutan’s internal matters, though it can act as a mentor.

Inclusive Economic ties:

• India has to make efforts to reduce Bhutan’s debt fears. Operationalisation of the pending projects can reduce the fears.
• There is no harm in diversifying one’s economy and India should see it as a new opportunity to partner with Bhutan and help diversify its economy.
• It should transform its relation from an aid provider to an investment led developer.
• Skilling Bhutan’s youth, developing a bilateral tourism policy and increasing private investment can be helpful for both.