Bhutan's China Connection: Implications for India | 27 Oct 2023

Recently, the Bhutanese Foreign Minister paid a visit to China, which is being seen as unprecedented on various levels as Bhutan and China do not maintain diplomatic relations and this visit is the first ever by a Bhutanese Foreign minister.

China and Bhutan held their 25^th round of boundary talks in Beijing and signed a Cooperation Agreement on the “Responsibilities and Functions of the Joint Technical Team (JTT) on the Delimitation and Demarcation of the Bhutan-China Boundary.” This advances their 3-Step Roadmap initiated in 2021 for border resolution, building on the positive momentum since their last talks in 2016.

• The 3-Step Roadmap involves first, agreeing to the border “on the table”; then visiting the sites on the ground; and then formally demarcating the boundary.

What are India’s Concerns regarding this Visit?

• India's unique relationship with Bhutan has made it cautious about establishing diplomatic ties and signing a boundary agreement.
• Despite India's concerns, it seems that establishing diplomatic relations and signing a boundary agreement between Bhutan and China is becoming more likely.
  • However, The Bhutanese Prime Minister recently reassured India that any agreement with China would not harm India's interests.
• Considering Bhutan’s unique dependence on India, there is little doubt that it will have taken India on board in its efforts to normalize relations with China, in return guaranteeing India’s security interests and red lines (a boundary or limit which should not be crossed).
  • One such red line involves keeping China away from southern Doklam’s ridges that overlook India’s “Siliguri corridor”, even as Bhutan and China consider a “swap” between territories in the valleys of the north and on the Doklam plateau in the west.
  • A second line involves Bhutan going slow on normalizing ties and opening itself up to a permanent Chinese diplomatic presence, while continuing with border talks.

What could be the Impacts on India of growing Bhutan-China relations?

• Security implications:
  • China’s increasing presence and influence in Bhutan could pose a threat to India’s security interests, especially in the Doklam plateau, which is a strategic area near the tri-junction of India, Bhutan and China.
    • China and India had a tense standoff over Doklam in 2017, when Indian troops intervened to stop Chinese road construction in the disputed territory claimed by Bhutan.
  • If China and Bhutan reach a border deal that involves Doklam, it could compromise India’s access to its northeastern states through the Siliguri Corridor, also known as the Chicken’s Neck.
  • India would also lose its leverage over Bhutan as a buffer state and have to deal with a potential two-front war scenario with China and Pakistan.
• Economic implications:
  • Bhutan and India have a strong economic partnership, mainly based on hydropower cooperation.
    • India is Bhutan’s largest trading partner and the biggest source of foreign direct investment, aid and loans.
    • India also imports most of Bhutan’s surplus electricity, which accounts for about 40% of Bhutan’s revenue.
  • If Bhutan diversifies its economic ties with China, it could reduce its dependence on India and affect India’s energy security.
• Diplomatic implications:
  • Bhutan and India have a special relationship based on historical, cultural and political ties.
    • India has been Bhutan’s closest ally and protector since 1949, when they signed a treaty (Indo-Bhutan Treaty of Peace and Friendship, 1949) that gave India significant control over Bhutan’s foreign policy and defense.
  • Although the treaty was revised in 2007 to give Bhutan more autonomy, India still plays a significant role in Bhutan’s external affairs.
  • If Bhutan establishes formal diplomatic relations with China, it could affect its traditional pro-India foreign policy and challenge India’s influence in the region.
• Infrastructure and Connectivity:
  • If Bhutan participates in China's Belt and Road Initiative (BRI), it might have implications for regional infrastructure development and connectivity. India has concerns over the BRI's strategic and security implications.
• Influence in Regional Organizations:
  • Bhutan's alignment with China could impact India's influence in regional organizations like the South Asian Association for Regional Cooperation (SAARC) and the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).

How should India act amid growing relations between Bhutan and China?

• Engage in Diplomacy: India should continue diplomatic engagement with Bhutan to understand its evolving relationship with China. Open and transparent communication is crucial to maintain trust and address any concerns Bhutan may have.
• Collaborate on Border Negotiations: India should work closely with Bhutan on border negotiations. A mutually acceptable border deal that addresses Bhutan's concerns in the north while preserving India's interests in the west can be a win-win situation. This collaborative approach will strengthen the long-standing friendship between the two nations.
• Understand Bhutan's Perspective: India should strive to understand Bhutan's reasoning and motivations in its dealings with China. This includes appreciating Bhutan's desire for economic development and security, and recognizing that it may engage with China for its own interests.
• Build Confidence: India should have confidence that Bhutan, as a trusted neighbor, will consider India's interests along with its own when making decisions regarding its relationship with China. Building this mutual trust is essential to ensure stability in the region.
  • Bhutan’s Prime Minister has already assured India that any agreement with China would not harm India's interests.
• Maintain a Strong Bilateral Relationship: India should continue to strengthen its bilateral ties with Bhutan through development assistance, cultural exchanges, and security cooperation. These bonds of friendship will further align the interests of the two nations.
• Regional Cooperation: India should explore avenues for trilateral or multilateral cooperation involving Bhutan, India, and China to address common regional challenges such as environmental conservation, disaster management, and trade.

Conclusion

Bhutan's burgeoning relationship with China has complex implications for India's strategic interests, economy, and regional influence. India's response requires a delicate balance, prioritizing security, economic diversification, and regional diplomacy. By maintaining strong ties with Bhutan, engaging in open dialogue, and fostering regional cooperation, India can navigate these evolving dynamics effectively while preserving its interests in its strategic neighborhood.