Advantage China as India fumbles in Bhutan

The best years of the India-Bhutan relations may soon be a thing of the past.

The new Bhutanese Prime Minister Lyonchhoen Tshering Tobgay concluded his five day visit to India on Wednesday and this is the bleak perspective from South Block of the closest bilateral friendship that India has had with any country since 1947.

The media in New Delhi highlighted how the joint statement issued after Tobgay’s meeting with Prime Minister Manmohan Singh “reaffirmed” the India-Bhutan “mutual security interests” and that the two sides “agreed to continue their close coordination and cooperation with each other on issues relating to their national interest”.

But few atop Raisina Hill are in any doubt that Thimphu will continue to carve out a bigger space for its economic and strategic decision-making rather than let the India House Estate, the residence of the Indian Ambassador to Thimphu, call the shots.

The reasons for this are purely economic, say sources. New Delhi’s shoddy handling of Bhutanese concerns in recent months and unwarranted arm-twisting, which New Delhi tried to explain away as a technical goof up, has forced many in Bhutan to review their perception of India. Sources say the rising cost of living because of the devaluation of rupee and the resultant increase in fuel prices and of goods that Bhutan imports from India has strengthened the Bhutanese resolve to have closer relations with China, Bangladesh, Thailand and Myanmar.

India’s external affairs ministry has found itself at its wit’s end as other government departments have ensured that the Bhutanese are, even if inadvertently, made to feel insulted. The withdrawal of the fuel subsidy which Indian Foreign Secretary Sujatha Singh termed an “unfortunate technical lapse” has been perceived in Thimphu as the big brother showing the little brother his place, says a Bhutanese journalist.

That incident left enough of a sour taste in the mouths of the Bhutanese leadership for National Security Adviser Shiv Shankar Menon and the foreign secretary to rush to Thimphu to assuage the hurt and finalize the new Bhutanese PM’s visit to India. But MEA (Ministry of External Affairs) officials say there is little that they can do when other government departments have slipped up, with delays, for instance, in the construction of hydel power projects, road infrastructure and the rail link from Hasimara in Bengal to Phuentsholing in Bhutan, which have gone on endlessly.

All of this is business as usual in India-Bhutan relations. But things have changed in the last couple of years with Beijing continuing to court Thimphu, and trying to stem the widespread suspicion that the common Bhutanese views the Chinese with ever since it annexed Tibet and laid claim to tracts of Bhutanese territory.

According to reports, the China-Bhutan boundary talks have progressed to Thimphu’s satisfaction. Beijing has offered 485 square kilometers to Bhutan in exchange for just 269 square kilometers that it wants from its smaller neighbor. The two sides will be conducting a “joint technical field survey” in September.

The development is of immense strategic concern to India as any such border agreement between Bhutan and China would make the buffer zone between the ‘Chicken’s Neck’ (the Siliguri corridor) and the India-China border in Chumbi valley ever so narrower. A boundary agreement may also have Thimphu request New Delhi to review the stationing of the Indian Army in Bhutan.

India, however, may have saved the day this time by offering a package of INR 5,000 crore (USD 730 million) towards Bhutan’s 11th Five Year Plan, which was also the largest amount ever rendered to it as financial assistance. Unfortunately, the Indian government is in the throes of chaos as all await the next general elections and the more organized state structure of India’s northern neighbor might be ready to take advantage of this state of limbo to build bridges with Thimphu.