threat. . India-Bhutan Trade And Transit Agreement ( ): It provides for duty- free transit of Bhutanese exports to third countries. Treaty of Cooperation in Hydropower and Protocol ( ) : Under this, India has agreed to assist Royal government of Bhutan in developing a minimum of , MW of hydropower and import the surplus electricity from this to India by the year .
Areas of cooperation Hydropower Cooperation India has constructed three hydroelectric projects (HEPs) in Bhutan totaling MW. Hydropower exports provide more than % of Bhutan’s domestic revenues and constitute % of its GDP. Presently, there are three Inter- Government(IG) model is under construction. Security Cooperation Both the countries have conducted joint military operation against insurgents.
The most notable was in when the Royal Bhutanese army conducted operations against ULFA (United Liberation Front of Assam). Diplomatic Cooperation Regular visits between highest level Government functionaries of both the countries have become a tradition. For example, in , our Prime Minister chose Bhutan as his first country to visit after getting elected. India sends foreign service officers to Bhutan to maintain good diplomatic relations.
Bhutan is a founding member of the South Asian Association for Regional Cooperation (SAARC). It is also a member of BIMSTEC, World Bank, the IMF, Group of and others. Economic Cooperation Bhutanese currency is Ngultrum (Nu.) and is officially pegged to the Indian Rupee (Rs.). India remains the single largest trading partner of Bhutan.
In a new trade agreement was signed. This agreement aims at cutting down the documentation related to trade and establishing additional trading points in Bhutan. India also offers duty free transit to Bhutan for trade with third countries. Educational and Cultural cooperation Many Bhutanese students pursue under- graduate courses in Indian universities on self-financing basis.
India-Bhutan foundation was established in for improving people to people cooperation in the areas of culture, education and environment protection. The fourth King of Bhutan King Jigme Singye Wangchuck coined the phrase “Gross Nations Happiness” in and declared that