India-Bhutan Sign Rs 4,000-Crore Credit Pact, Review Development Projects
UPSC / SSC current affairs note
Why in news
India and Bhutan signed a Rs 4,000-crore concessional line of credit agreement and reviewed ongoing development projects during the fifth India-Bhutan Development Cooperation Talks. This reaffirms India's role as Bhutan's largest development partner and highlights the deepening bilateral cooperation in health, green mobility, and infrastructure.
Background
India has been a major development partner for Bhutan, providing financial and technical assistance for various five-year plans. The current support package of Rs 10,000 crore for Bhutan's 13th Five-Year Plan (2024-29) includes Project Tied Assistance (PTA), High Impact Community Development Projects (HICDP), Economic Stimulus Programme (ESP), and Programme Grants.
Key facts
India and Bhutan signed a Rs 4,000-crore (Nu 40 billion) concessional line of credit agreement between the Export-Import Bank of India and Bhutan's ministry of finance.
The fifth India-Bhutan Development Cooperation Talks were co-chaired by Foreign Secretary Vikram Misri and his Bhutanese counterpart Dasho Pema Lektup Dorji in Thimphu.
The two sides reviewed the implementation of India's Rs 10,000-crore support package for Bhutan's 13th Five-Year Plan (2024-29).
12 new Project Tied Assistance (PTA) projects worth Rs 332 crore were approved in sectors including infrastructure, healthcare, agriculture, urban amenities, and disaster management.
With these approvals, the total number of PTA projects under Bhutan's 13th Five-Year Plan reached 82, with a combined outlay of Rs 6,860 crore.
India released Rs 1,250 crore under the Economic Stimulus Programme, Rs 735.2 crore for High Impact Community Development Projects, and Rs 200 crore as Programme Grant.
An MoU on health education and research was signed between AIIMS and Khesar Gyalpo University of Medical Sciences.
45 electric vehicles were handed over to the Royal Government of Bhutan as part of India's support for Bhutan's green mobility programme.
The Thimphu Ecological Park and Olakha Park were virtually inaugurated, developed under the India-funded 'Green Infrastructure and Open Spaces in Thimphu' project.
Foreign Secretary Misri was on a two-day visit to Bhutan from July 30 to 31, during which he called on King Jigme Khesar Namgyel Wangchuck.
Prelims pointers
- India-Bhutan Development Cooperation Talks: fifth edition held in Thimphu
- Export-Import Bank of India (EXIM Bank): involved in the credit line agreement
- AIIMS: All India Institute of Medical Sciences
- Khesar Gyalpo University of Medical Sciences: Bhutanese institution
- Bhutan's 13th Five-Year Plan: 2024-29
- Project Tied Assistance (PTA): a form of development aid
- High Impact Community Development Projects (HICDP): community-level projects
- Economic Stimulus Programme (ESP): financial support mechanism
- Programme Grant: direct budgetary support
- Green mobility: electric vehicles handed over
Mains angles
- Discuss the significance of India's development cooperation with Bhutan in strengthening bilateral relations.
- Critically examine the role of concessional lines of credit in India's neighbourhood policy.
- Analyze the strategic importance of Bhutan in India's 'Neighbourhood First' policy.
- Evaluate the impact of India's assistance on Bhutan's socio-economic development.