India–Bhutan Deepen Power Partnership, Fast-Track 2,200 MW Hydropower Push

India and Bhutan on Tuesday reaffirmed their strategic energy partnership, with both sides committing to accelerate hydropower development, optimize power generation, and strengthen long-term transmission planning to meet future energy demand.

The discussions took place during a high-level meeting between Bhutan's Minister of Energy and Natural Resources, Lyonpo Gem Tshering, India's Union Minister of Power and Housing & Urban Affairs, Shri Manohar Lal, and the Minister of State for Power and New and Renewable Energy, Shri Shripad Naik, in New Delhi.

Six Decades of Hydropower Cooperation

Indo-Bhutan hydropower cooperation dates back to 1961, making it one of South Asia's oldest and most stable cross-border energy partnerships. This collaboration was further institutionalised through the 2006 Agreement on Cooperation in Hydroelectric Power, which laid the foundation for joint development, financing, and power trade.

Hydropower remains central to Bhutan's economy, contributing significantly to government revenues and exports, while also supporting India's clean energy transition and regional energy security.

Optimising Output from Punatsangchhu-II

A key focus of the meeting was the commercial optimisation of power generation from the Punatsangchhu-II Hydroelectric Project (1,020 MW). Both sides discussed mechanisms to ensure efficient scheduling, grid integration, and market-oriented utilisation of power, particularly to maximise returns during peak demand periods.

The project is among Bhutan's largest hydropower assets and is expected to play a crucial role in stabilising cross-border electricity flows once fully optimised.

Push for Early Commissioning of Punatsangchhu-I

Ministers also reviewed progress on the Punatsangchhu-I Hydroelectric Project (1,200 MW) and underlined the importance of its early commissioning. Once operational, the project will significantly enhance Bhutan's installed capacity and strengthen India's access to reliable, renewable power from the Himalayan region.

Sankosh Project and Grid Vision 2040

The meeting deliberated on the way forward for the Sankosh Hydropower Project, one of the largest proposed joint ventures between the two countries. Discussions covered technical, financial, and implementation aspects aimed at moving the project towards execution.

In parallel, both sides examined transmission infrastructure planning up to 2040, reflecting a forward-looking approach to rising electricity demand, regional power trade, and renewable energy integration. Detailed technical consultations on cross-border transmission corridors are already underway.

Addressing Seasonal Power Constraints

Recognising Bhutan's hydropower seasonality, the Ministers discussed the need to streamline approvals for power scheduling, especially during lean water months. Improved coordination is expected to enhance grid stability and ensure smoother power exchanges throughout the year.

Shared Vision for Clean Energy Growth

The Ministers reaffirmed the deep-rooted friendship between India and Bhutan and expressed confidence that expanded cooperation in the power sector would deliver mutual economic benefits, support clean energy goals, and reinforce regional energy cooperation.

Both sides agreed to maintain close coordination at the technical and ministerial levels to translate these commitments into timely outcomes.