China has a border dispute with Bhutan but, because of India’s support, Beijing has not forced its hand. China, which wants to thwart Indian influence in Bhutan, has offered to open a diplomatic mission, an offer Bhutan has not permitted, writes J.K.Verma for South Asia Monitor.
J.K.Verma JAN 1, 2019
China, the world’s second largest economy, considers India as its strategic adversary. India challenged its might in 2017 during a 73 day-long standoff at the Doklam trijunction of India, China and Bhutan. Besides Doklam, there have been several other irritants between the two Asian giants.
Both countries share a 3,488 km long mountainous frontier, which is undemarcated at several places. China claims about 90,000 sq km in Arunachal Pradesh and 10,000 sq km of Uttarakhand. Beijing has already captured Aksai Chin and Pakistan has surrendered some portions of Jammu & Kashmir to it. The Dalai Lama’s presence in India is also a bone of contention.
Other disputes include a water dispute, China blocking India’s membership of the Nuclear Suppliers Group (NSG) and the China Pakistan Economic Corridor (CPEC), which passes through Indian territory illegally occupied by Pakistan. China has also blocked India’s efforts to have Jaish-e-Mohammed Chief Masood Azhar declared a UN-designated global terrorist.
China is also averse to India’s special relationship with Bhutan. The India-Bhutan Friendship Treaty of 2007 clearly mentions that neither country will allow the use of its territory for activities which are harmful to the security of the other country. Indian defence forces help defend Bhutan, thus making Bhutan a protected country and Delhi has sway over Bhutan’s defence and foreign policies. India is also Bhutan’s biggest foreign donor. China has a border dispute with Bhutan but, because of India’s support, Beijing has not forced its hand. China, which wants to thwart Indian influence in Bhutan, has offered to open a diplomatic mission, an offer Bhutan has not permitted.
China, which has deep pockets and a long-term strategy, has strategically encircled India. It has grabbed Hambantota port from Sri Lanka while China has constructed a signal intelligence unit in Coco Islands of Myanmar. Pakistan, which is passing through a grave economic crisis, is completely under China’s sway and has already lost Gwadar port. Nepalese Prime Minister K P Sharma Oli is close to China and is taking the country away from India. China has also constructed a military base in Djibouti.
In view of above, the three-day state visit of Bhutanese Prime Minister Lotay Tshering to India was significant. It was Tshering’s first foreign visit after taking over as Prime Minister.
India pledged a contribution of $ 643.5 million in Bhutan’s 12th five year plan and also offered transitional trade support of US$ 57.3 million to invigorate bilateral trade. Both Tshering and Indian Prime Minister Narendra Modi agreed to enhance hydro-electric power generating capacity to 10,000 MW in Bhutan. They discussed the current situation in Doklam as well as cooperation in space science.
Modi, under his ‘neighbourhood first’ policy paid his first foreign visit to Thimphu. Bhutan is also an important part of BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation).
India should try to clear Bhutan’s apprehensions about BIMSTEC and should assist the country to construct more hydel power projects. According to an estimate, Bhutan has potential to produce 30,000 megawatt of electricity. India has constructed three hydroelectric projects there, which are producing 1,416 MW of electricity, three-fourths of which is exported to India.
Tshering and his party Druk Nyamrup Tshogpa (DNT) are keen to strengthen their relations with China. The visiting Prime Minister insisted that Bhutan should be paid more for electricity generated through the Mangdechhu project, the Sunkosh Reservoir project should start early and India’s Goods and Services Tax (GST) should be reduced for Bhutan. India is offering Rs.3.90 a unit while Bhutan seeks Rs.4.40 per unit. Tshering said he wanted a fair price for electricity as it is the main source of revenue for their 12th five year plan. Bhutan has not sought an increase in the aid amount for the 12th five year plan; hence India’s budgetary support declined to 14 % from 23 % in 11th five year plan.
India should grab the opportunity and should convert itself from the biggest donor to principal development partner. Indian industrialists should start industries in Bhutan as hydro power projects may generate money but will not create jobs for young Bhutanese. India should try to reduce GST rates as it is essential for a long-term relationship.
India should chalk out a long-term strategy to counter China, not only in Bhutan but in other places too. At present China is much more powerful than India; hence Delhi should ramp up its friendship with USA, Japan and other like-minded countries. Indian policy makers should also try to convince neighbouring countries that China is an expansionist power and it gives loans with the ulterior motive of occupying their territory.
(The author is a New Delhi-based strategic analyst. He can be contacted at firstname.lastname@example.org)
The artcile appeared in the South Asia Monitor on 1 January 2018