India Bhutan Power Agreement

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India Bhutan Power Agreement: A Win-Win for the Two Nations

India and Bhutan share a special relationship since 1961. India is a major development partner for Bhutan, providing assistance in various sectors such as education, health, infrastructure, and energy. The energy sector cooperation between the two nations is particularly noteworthy, with India importing hydroelectric power from Bhutan since the commissioning of the Chukha Hydel Project in 1988. The recent agreement signed between India and Bhutan for the export of power from Bhutan to India is a significant milestone in their energy partnership.

The agreement was signed on April 19, 2021, between the Bhutanese government and India`s National Thermal Power Corporation (NTPC) Limited. As per the agreement, Bhutan will export 850 MW of surplus electricity from various hydroelectric projects to India for a period of 35 years. The power will be transmitted through the 720 km long HVDC (High Voltage Direct Current) transmission line from Bhutan`s hydropower plants in the eastern region to Indian states such as Bihar, Uttar Pradesh, and West Bengal. The project is expected to cost around $1 billion and will be funded by the Indian government under the Line of Credit (LoC) scheme.

The India Bhutan Power Agreement is a win-win for both nations. For Bhutan, it provides a significant revenue stream from the export of electricity, which is a major contributor to its economy. Bhutan`s hydropower potential is estimated to be around 30,000 MW, of which less than 10% has been utilized. By exporting surplus power to India, Bhutan can earn foreign exchange and use the revenue to fund its development projects. Moreover, the power agreement will strengthen Bhutan`s energy security and help it achieve its goal of becoming a carbon-neutral country.

For India, the power agreement provides access to clean and renewable energy at affordable prices. India is the third-largest emitter of greenhouse gases in the world after China and the United States, and reducing carbon emissions is a priority for the country. Importing hydroelectric power from Bhutan is an excellent way for India to meet its renewable energy targets and reduce its carbon footprint. Furthermore, the power agreement will help India meet the energy demands of its growing population, reduce its dependence on fossil fuels, and promote the use of clean energy.

The India Bhutan Power Agreement is also a significant step towards regional cooperation and integration. The transmission line will pass through the Indian states of West Bengal, Bihar, and Uttar Pradesh, providing access to electricity to millions of people in these states. The project will also boost trade and connectivity between India and Bhutan and contribute to the overall economic development of the region.

In conclusion, the India Bhutan Power Agreement is a testament to the strong and enduring partnership between the two nations. It is a mutually beneficial agreement that will help Bhutan earn much-needed revenue and strengthen its energy security while providing India with clean and renewable energy at affordable prices. The project will also promote regional cooperation and integration and contribute to the overall economic development of the region.

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