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Bhutan - India Relations

India is Bhutan's largest trade and development partner, providing significant amounts of foreign aid and investment. Traditionally, the 1949 Treaty of Peace and Friendship governed relations between the countries, which required Bhutan to obtain the advice of India in matters of foreign relations.

India Bhutan is bounded on three sides by India. From east to west, the Indian states of Sikkim, West Bengal, Assam, and Arunachal Pradesh (formerly the North-East Frontier Agency) border Bhutan. In view of the long-standing political disputes and border confrontations between India and China, Bhutan has long been part of India's strategic defense plan. In the view of some Indian strategists, Bhutan was a weak link in India's defense against China.

The key document guiding relations with India was the Treaty of Friendship Between the Government of India and the Government of Bhutan of 1949. The ten-article treaty, in force in perpetuity, called for peace between the two countries and assures Indian noninterference in Bhutan's internal affairs in return for Bhutan's agreeing "to be guided by the advice of the Government of India in regard to its external relations" (Article 2). The treaty provided for compensation by India at a higher rate than provided in the 1865 and 1910 British treaties, and it returned Bhutan's Dewangiri territory seized by Britain in the Duar War. It also guaranteed free trade between the countries and duty-free transit across India of Bhutan's imports. Furthermore, the treaty assures the rights of citizens of each country and the extradition of criminals seeking refuge in either country.

Following Britain’s victory in the 1865 Duar War, Britain and Bhutan signed the Treaty of Sinchulu, under which Bhutan would receive an annual subsidy in exchange for ceding land to British India. Ugyen WANGCHUCK - who had served as the de facto ruler of an increasingly unified Bhutan and had improved relations with the British toward the end of the 19th century - was named king in 1907. Three years later, a treaty was signed whereby the British agreed not to interfere in Bhutanese internal affairs, and Bhutan allowed Britain to direct its foreign affairs.

When India became independent in 1947, it became necessary to draw up a new treaty. An Indo-Bhutan treaty was signed in 1949 permitting Bhutan to control its internal affairs but requiring it to obtain the advice of India in matters of foreign relations. This formal Indo-Bhutanese accord returned to Bhutan a small piece of the territory annexed by the British, formalized the annual subsidies the country received, and defined India's responsibilities in defense and foreign relations. Under a succession of modernizing monarchs beginning in the 1950s, Bhutan joined the UN in 1971 and slowly continued its engagement beyond its borders.

Events in Tibet had causal effects on Bhutan-Indian relations. When the Chinese communists took over Tibet in 1951, Bhutan braced itself against a renewed external threat with a modernization program and a new defense posture. In his first visit to Bhutan in 1958, Indian prime minister Jawaharlal Nehru reiterated India's wish that Bhutan remain an independent country, "taking the path of progress according to your will." Following precedent, Bhutan sided with India when the Chinese army occupied Tibet in 1959 and a border dispute emerged between China and India. Nehru declared in the Indian parliament in November 1959 that "any aggression against Bhutan . . . would be regarded as an aggression against India."

A de facto alliance developed between Bhutan and India by 1960, and Indian aid increasingly bolstered Bhutan's strategic infrastructure development. In times of crisis between India and China or between Bhutan and China, India was quick to assure Bhutan of military assistance. Concerns were raised by Bhutan, however, during the 1971 Indo-Pakistani War when there were doubts about India's ability to protect Bhutan against China (which sided with Pakistan) while fighting a two-front war.

In 1960 the Druk Gyalpo had said that Bhutan was not 100 percent independent because of the 1949 treaty, and until Bhutan emerged into the world of international diplomacy by joining the UN in 1971, Article 2 of the treaty seemed intact. Admission to the UN, however, changed Bhutan's perspective on the world beyond India and Thimphu's traditional dependence on New Delhi. Two years later, Bhutan and Bangladesh exchanged diplomatic recognition, hinting further at Thimphu's independent attitude.

A new interpretation of the relationship emerged in 1974 when Bhutan's minister of foreign affairs said that Bhutan's following India's advice and guidance on foreign policy matters was optional. Bhutan had raised its representation in India to the ambassadorial level in 1971 and in 1978 changed the name of its diplomatic office in New Delhi from the Royal Bhutan Mission to the Royal Bhutan Embassy to further reflect its sovereign status. A new trade agreement between Bhutan and India in 1972 exempted from export duties goods from Bhutan to third countries.

The Druk Gyalpo's statement in 1979 that the 1949 treaty needed to be "updated" was still another move asserting independence. Members of the National Assembly speaking just before the Druk Gyalpo's "update" announcement made the interpretation that Article 2 only required Bhutan to seek India's advice and guidance on matters of external affairs. Bhutan exerted its independent stance at the Nonaligned Movement summit conference in Havana, also in 1979, by voting with China and some Southeast Asian countries rather than with India on the issue of allowing Cambodia's Khmer Rouge to be seated at the conference. Bhutan's votes in the UN on such issues as the status of landlocked nations also did not follow India's leads.

Despite a history of good relations between Bhutan and India, bilateral border issues long went unresolved. Indo-Bhutanese borders had been delineated in the Treaty of Peace of 1865 between Bhutan and Britain, but it was not until the period between 1973 and 1984 that a detailed delineation and demarcation was made. Border demarcation talks with India generally resolved disagreements except for several small sectors, including the middle zone between Sarbhang and Geylegphug and the eastern frontier with Arunachal Pradesh.

In recent years, insurgents on the Indian side of the border from the United Liberation Front of Assam (ULFA) and the Bodos have used Bhutan as a safe haven. In December 2003, Bhutan military troops expelled Indian insurgents from Assam. Through this joint effort with India, Bhutan strengthened border security and continued cooperation with the Indian military.

The Indo-Bhutan Friendship Treaty of 2007 clarifies Bhutan's status as an independent and sovereign nation. India and Bhutan renegotiated their treaty, eliminating the clause that stated that Bhutan would be "guided by" India in conducting its foreign policy, although Thimphu continued to coordinate closely with New Delhi. The Treaty of 1949, Article 2 states: "The Government of India undertakes to exercise no interference in the internal administration of Bhutan. On its part the Government of Bhutan agrees to be guided by the advice of the Government of India in regard to its external relations."

The revised treaty now states "In keeping with the abiding ties of close friendship and cooperation between Bhutan and India, the Government of the Kingdom of Bhutan and the Government of the Republic of India shall cooperate closely with each other on issues relating to their national interests. Neither government shall allow the use of its territory for activities harmful to the national security and interest of the other." The revised treaty also includes this preamble: "Reaffirming their respect for each other's independence, sovereignty and territorial integrity", an element that was absent in the earlier version. This agreement allowed Bhutan to purchase military equipment from other countries.

Bilateral ties remain close, demonstrated by Indian Prime Minister Manmohan Singh's May 2008 visit to Thimpu during which he addressed the newly elected parliament. Prime Minister Jigme Thinley returned the gesture when he made his first official trip abroad as prime minister to New Delhi in July 2008; King Jigme Khesar Namgyel Wangchuck also visited India in December 2009.

India’s new government reached out to neighbors to reassert its influence in South Asia, which had waned in recent years. This had helped China make inroads into countries like Nepal, Sri Lanka and Bangladesh by offering to build ports, roads and using its economic clout to make other investments. India also had a dispute with Bhutan last year when it cut fuel subsidies to the country, seen as a mark of New Delhi’s anger with the Himalayan country’s effort to engage with Beijing. The subsidies were later restored.

On a visit to Bhutan, Indian Prime Minister Narendra Modi has pledged to build stronger ties with the neighboring Himalayan country wedged between India and China. The June 16, 2014 visit was seen as an effort by the new government to counter China’s growing influence in India’s neighborhood. During his two-day stop in the Bhutanese capital, Thimphu, Indian Prime Minister Narendra Modi laid the foundation of a 600 megawatt hydroelectric power station to be built jointly, opened a Supreme Court building made with Indian assistance, and assured Bhutan of continuing support for the tiny country’s development. He told the Bhutanese parliament that India is committed to good relations with its neighbors.