Syllabus: GS2/ International Relations, GS3/ Energy and Infrastructure
Context
- India and Bhutan have reaffirmed their longstanding partnership in water resources management and hydropower development during a high level visit by an Indian delegation to Bhutan.
India-Bhutan Hydropower Relations
- Early Cooperation: Indo–Bhutan hydropower cooperation began in 1961 with the signing of the Jaldhaka agreement.
- The Jaldhaka project is located on the Indian side of the border in West Bengal, and most of the power generated was exported to southern Bhutan.
- A major milestone came in 1987 with the commissioning of the 336 MW Chukha Hydropower Project.
- It was Bhutan’s first mega power project.
- It was funded by India in a 60% grant and 40% loan format, with the loan at 5% interest payable over 15 years after commissioning.
- The 1,020 MW Tala Hydroelectric Project further strengthened bilateral cooperation.
- It was also financed in the 60:40 grant-loan model by the Government of India and significantly enhanced Bhutan’s export earnings.
Institutional Framework between India-Bhutan
- In July 2006, the two countries signed the Agreement on Cooperation in the Field of Hydroelectric Power (HEP), which laid down a formal framework for collaboration.
- In April 2014, both countries signed a Framework Inter-Governmental Agreement to develop Joint Venture (JV) hydropower projects through Public Sector Undertakings (PSUs).
Major Ongoing and Planned Projects
- Punatsangchhu-I (1,200 MW): It has experienced significant delays and cost escalations due to geological problems at the dam site, with work resuming on the main dam structure as of late 2025.
- Joint Venture Model Projects:
- 600 MW Kholongchhu Hydroelectric Project
- 180 MW Bunakha Hydroelectric Project
- 570 MW Wangchu Hydroelectric Project
- 770 MW Chamkharchu Hydroelectric Project
Hydrological Strengths of Bhutan
- Bhutan’s topography and climate uniquely favor large-scale hydropower.
- Major Bhutanese rivers like Punatsangchhu, Wang Chhu/Raidak, Drangme Chhu/Manas, Amochhu/Sankosh, etc. are snow- and monsoon-fed and have steep gradients.
- Bhutan’s glacial lakes and snowmelt are additional water sources, though they also pose Glacial Lake Outburst Flood (GLOF) risks.
Significance for India
- Energy Security and Climate Goals: Bhutan supplies clean and renewable electricity to India, helping India meet its renewable energy and climate commitments.
- Imported hydro power complements India’s solar and wind capacity by providing stable and flexible energy.
- Grid Stability in the Northeast: India’s northeastern grid benefits from flexible hydro capacity, which helps manage seasonal demand and renewable variability.
- States such as Assam gain improved power reliability.
- Reduction in Thermal Dependence: Hydropower imports reduce dependence on coal-based thermal generation. This lowers carbon emissions and reduces fuel import costs.
- Strategic and Economic Dimension: Hydropower is Bhutan’s largest source of revenue, much of which comes from exports to India.
- The cooperation strengthens India’s strategic influence in the Himalayan region amid growing geopolitical competition.
Challenges
- Environmental Risks: Climate change increases the threat of Glacial Lake Outburst Flood (GLOF) and ecological damage.
- Hydrological Variability: Changing rainfall and glacier melt patterns impacts long-term generation.
- Local Concerns: Land acquisition, ecological impacts, and livelihood issues require sensitive handling.
- Debt Sustainability for Bhutan: High borrowing for hydropower projects has raised concerns about external debt levels.
Way Ahead
- Hydropower cooperation remains the cornerstone of India–Bhutan relations.
- It reflects mutual trust, economic interdependence, and shared strategic interests.
- Strengthening transboundary river management and ensuring environmentally sustainable hydropower development will be essential to maintaining this mutually beneficial partnership in the coming decades.
Source: DD News
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