<p>The joint statement issued at the end of Bhutan prime minister Tshering Tobgay’s visit to India has rightly described the relations between the two countries as ‘privileged.’ The importance Bhutan attaches to its ties with India is seen from the fact that within two months of his assuming office the new prime minister chose to visit India.<br /><br /></p>.<p>It was in July that the People’s Democratic Party led by Tobgay came to power defeating former prime minister Jigme Thinley’s party. Bhutan has been India’s steadfast friend and being a small landlocked country it has been dependent on India. There was an irritant in the relations earlier this year when India cut subsidies on cooking gas and kerosene supplied to Bhutan. This was seen as a sign of displeasure over the former government’s seeming willingness to develop closer relations with China, which is Bhutan’s other big neighbour. This was unfortunate and the Indian action perhaps influenced the outcome of the election also, with the people punishing Jigme Thinley. The subsidy has been restored and the irritant has been removed.<br /><br />It is the economic dimension of the relations that was emphasised in the joint statement. India had gone cold on this also after Thinley’s meeting with Chinese prime minister Wen Jiabao last year. But Tobgay’s visit has led to some concrete results. Bhutan’s economy is under some stress and India has offered a Rs 4,500 crore financial aid for its five year plan and a Rs 500 crore economic stimulus package. Bhutan also wants Indian investment in areas like infrastructure, education and health. Tobgay has said that Indian companies have expressed interest in investing in these areas. Indian investment in hydro-electric power and mining will be beneficial to both countries.<br /><br />Bhutan is strategically important for India. Indian sensitivities have their roots in this fact. Bhutan has been responsive to India’s security needs. But India is cautious about China increasing its influence there. There are signs of increased engagement between Bhutan and China. Like India, Bhutan also has a longstanding border dispute with China. There are reports that they are close to resolving their disputes by exchanging areas. China also wants to improve business and other relations with Bhutan. India need not be paranoid about this and should allow its ties to grow through more cooperation rather through coercion. </p>
<p>The joint statement issued at the end of Bhutan prime minister Tshering Tobgay’s visit to India has rightly described the relations between the two countries as ‘privileged.’ The importance Bhutan attaches to its ties with India is seen from the fact that within two months of his assuming office the new prime minister chose to visit India.<br /><br /></p>.<p>It was in July that the People’s Democratic Party led by Tobgay came to power defeating former prime minister Jigme Thinley’s party. Bhutan has been India’s steadfast friend and being a small landlocked country it has been dependent on India. There was an irritant in the relations earlier this year when India cut subsidies on cooking gas and kerosene supplied to Bhutan. This was seen as a sign of displeasure over the former government’s seeming willingness to develop closer relations with China, which is Bhutan’s other big neighbour. This was unfortunate and the Indian action perhaps influenced the outcome of the election also, with the people punishing Jigme Thinley. The subsidy has been restored and the irritant has been removed.<br /><br />It is the economic dimension of the relations that was emphasised in the joint statement. India had gone cold on this also after Thinley’s meeting with Chinese prime minister Wen Jiabao last year. But Tobgay’s visit has led to some concrete results. Bhutan’s economy is under some stress and India has offered a Rs 4,500 crore financial aid for its five year plan and a Rs 500 crore economic stimulus package. Bhutan also wants Indian investment in areas like infrastructure, education and health. Tobgay has said that Indian companies have expressed interest in investing in these areas. Indian investment in hydro-electric power and mining will be beneficial to both countries.<br /><br />Bhutan is strategically important for India. Indian sensitivities have their roots in this fact. Bhutan has been responsive to India’s security needs. But India is cautious about China increasing its influence there. There are signs of increased engagement between Bhutan and China. Like India, Bhutan also has a longstanding border dispute with China. There are reports that they are close to resolving their disputes by exchanging areas. China also wants to improve business and other relations with Bhutan. India need not be paranoid about this and should allow its ties to grow through more cooperation rather through coercion. </p>
