Closer together: On the India-Bhutan talks and the plans ahead

India and Bhutan can change the development story of the region

The decision by India and Bhutan to focus on infrastructure and connectivity during talks between Prime Minister Narendra Modi and Bhutan’s fifth King Jigme Khesar Namgyel Wangchuck is an important marker towards more bilaterally driven regional initiatives. A joint statement speaks of completing surveys for the Kokrajhar-Gelephu rail link that connects Bhutan to Assam, and beginning discussions on another Bhutan to West Bengal rail link, while also facilitating Bhutan-Bangladesh trade, with yet another rail link, and upgrading checkpoints along the India-Bhutan border. These plans foretell a future that could well change the development story of the region, including West Bengal and the northeast, Bhutan’s south and east dzongkhags (districts), as well as Northern Bangladesh. Bhutan’s economy has been dependent on hydropower and tourism revenues, and has been particularly hit by the COVID-19 pandemic as well as worries over global warming. A lack of opportunities has also led-to emigration by educated youth and professionals. The new project proposed by the king, to build a Special Economic Zone at Bhutan’s southern border with Assam, and an airport at Gelephu, are expected to drive growth and investment to the kingdom. In addition , Bangladesh’s signing of a Preferential Trade Agreement with Bhutan in 2020 could increase Bhutanese export of local produce and build more markets for Indian and Bangladeshi producers in the sub-region. India’s “energy exchange”, which is bringing more Bhutanese and Nepali hydropower suppliers online, while planning to distribute energy to Bangladesh and Sri Lanka, will drive intra -regional growth and revenues. This would also power New Delhi’s attempt at bridging the economic gap with the northeast, while drawing development partners like the World Bank and donor countries like Japan into the creation of a “sub-regional hub”.

Efficient and time-bound execution is, therefore, key to such ambitious plans. Given India’s problems with Pakistan and sanctions on Myanmar for the 2021 coup blocking the path for trade and land connectivity to the East, working with other countries on India’s periphery to build connectivity, markets and energy links is the most sustainable way forward . In the longer term, geopolitical conflicts and anti-globalisation trends are forcing regional groupings to be more cohesive , something South Asia has not been able to achieve as yet. As India worries about China’s push into South Asian trade, infrastructure projects and strategic ties, including concerns over a Bhutan-China boundary agreement’s overhang over Doklam and India’s “Chicken Neck” (Siliguri Corridor) route, these are ideas which will offer more security and prosperity for the countries involved, with particular benefits for Bhutan, India’s traditionally trusted partner in the region.