India, Bhutan discuss hydropower projects, transmission plans to boost energy partnership
Bhutan’s Minister of Energy and Natural Resources Lyonpo Gem Tshering held talks with India’s Union Minister of Power Manohar Lal in New Delhi on Tuesday, with discussions centred on deepening bilateral cooperation in the power and renewable energy sectors.
Context: Focus on major hydropower projects
According to an official statement, both sides reviewed progress on key hydropower projects being developed jointly. A major part of the discussion focused on the commercial optimisation of power generation from the 1020 MW Punatsangchhu-II Hydroelectric Project. The ministers also stressed the importance of early commissioning of the 1200 MW Punatsangchhu-I Hydroelectric Project, which has faced delays in the past.
The meeting also covered the future roadmap for the Sankosh Hydropower Project, another strategically important initiative in the India–Bhutan energy partnership.
Transmission planning and operational issues
India and Bhutan deliberated on long-term transmission infrastructure planning up to 2040, with detailed consultations currently underway between technical teams. The need to streamline approvals related to power scheduling, especially during Bhutan’s lean generation months, was also discussed to ensure smoother energy trade between the two countries.
Minister of State for Power and New and Renewable Energy Shripad Naik and senior officials from the Ministry of Power were present at the meeting.
Background: Recent milestones in cooperation
In November 2025, Prime Minister Narendra Modi inaugurated the Punatsangchhu-II project, marking a key milestone in bilateral energy cooperation. India and Bhutan also agreed to resume work on the main dam structure of the Punatsangchhu-I project. India has extended a ₹4,000 crore Line of Credit to Bhutan to support economic development.
Beyond energy, India has announced land allocation in Varanasi for a Bhutanese temple and guest house, and both sides have agreed to establish an Immigration Check Post at Hatisar across Gelephu.
Renewable energy MoU
During PM Modi’s visit, an MoU on renewable energy cooperation was signed between Lyonpo Gem Tshering and Pralhad Joshi. The agreement aims to institutionalise collaboration in solar, wind, biomass, energy storage, green hydrogen and capacity building.
Our Thoughts
The latest India–Bhutan talks underline how energy cooperation remains the backbone of bilateral ties. With hydropower projects, long-term transmission planning and renewable energy collaboration on the agenda, both countries appear focused on building a future-ready partnership that balances economic growth with sustainability.
