India-Bhutan Special Relationship
India and Bhutan share one of the closest bilateral relationships in South Asia — unique in the absence of a formal defence treaty yet deep in security, economic, and development integration. The foundational document is the India-Bhutan Treaty of Friendship and Cooperation (2007 revision), which replaced the 1949 treaty and gave Bhutan greater foreign policy autonomy while maintaining the security partnership.
India is Bhutan's largest trade partner and primary development partner. The centrepiece of economic cooperation is hydropower: Bhutan exports hydroelectric power to India under a cost-sharing model (Chukha, Tala, Punatsangchhu, Mangdechhu projects), which constitutes over 30% of Bhutan's GDP and its largest foreign exchange earner.
- 1949 Treaty: "guided by" India in foreign policy (Bhutan had limited foreign policy autonomy) — replaced by 2007 Treaty
- 2007 Treaty of Friendship: Bhutan retains full foreign policy autonomy; India remains primary security partner
- Hydropower: Tala project (1,020 MW), Chukha project (336 MW), Punatsangchhu I & II (under construction), Mangdechhu (720 MW, operational 2019)
- India's grant assistance to Bhutan: significant under each Five-Year Plan; 13th FYP (2023–28) ongoing
- Bhutan-China border talks: China-Bhutan have ongoing border negotiations (72 rounds); India's security interest in Doklam area is central
● Tracked since February 27, 2026 · last seen April 11, 2026 · updates as the daily brief publishes