India-Bhutan Development Ties: 12 Projects Approved, ₹4,000 Crore Energy Credit Pact Signed During Vikram Misri's Visit

New Delhi, August 1, 2026: India and Bhutan have reviewed their development partnership, with the two countries approving 12 new projects worth Rs 332 crore and signing a Rs 4,000 crore Line of Credit agreement for energy projects.

The developments came during Foreign Secretary Vikram Misri's two-day visit to Thimphu, which concluded on Friday. The Line of Credit agreement was signed between Bhutan and the Export-Import Bank of India. Misri visited the neighbouring country to review the progress of development projects supported by New Delhi.

Development Partnership Reviewed

During the visit, Misri called on King Jigme Khesar Namgyel Wangchuck, Prime Minister Dasho Tshering Tobgay and Minister for Foreign Affairs and External Trade Lyonpo D.N. Dhungyel.

Misri's visit came soon after his China trip on July 27-28, as New Delhi and Beijing continue efforts to maintain dialogue and engagement on bilateral issues, including border-related matters and broader cooperation.

On Thursday, Misri and his Bhutanese counterpart, Dasho Pema Lektup Dorji, co-chaired the fifth India-Bhutan Development Cooperation Talks. The discussions focused on implementing projects under Bhutan's 13th Five-Year Plan, according to the Indian Embassy in Bhutan.

The two sides discussed all aspects of bilateral cooperation, including development partnership, energy, trade and investment, connectivity, and people-to-people ties. They also discussed regional issues of mutual importance, the Ministry of External Affairs (MEA) said in a statement on Friday.

Projects And Credit Support

During the talks, India and Bhutan reviewed the overall progress and implementation of India's Rs 10,000 crore support for Bhutan's 13th Five-Year Plan period from 2024 to 2029.

A total of 12 new projects worth Rs 332 crore were approved. The projects cover infrastructure, healthcare, agriculture, urban amenities and disaster management.

The scale and range of the projects underline the importance both countries continue to place on development cooperation. The focus on infrastructure, healthcare and green initiatives also shows that the partnership is extending beyond traditional areas of engagement into projects with a direct impact on people's lives.

Green Initiatives And Health Cooperation

The two Foreign Secretaries virtually inaugurated the Thimphu Ecological Park and Olakha Park. The parks were developed under the Green Infrastructure and Open Spaces in Thimphu initiative, funded by India as part of bilateral economic development.

The two sides also exchanged a pact on cooperation in health education and research between the All India Institute of Medical Sciences (AIIMS) and Bhutan's Khesar Gyalpo University of Medical Sciences.

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As part of India's support for Bhutan's green mobility initiatives, 45 electric vehicles were handed over to the Royal Government of Bhutan.

Taken together, the new projects, the Line of Credit agreement and cooperation in areas ranging from health to green mobility point to a broadening development partnership between India and Bhutan, with practical projects remaining at the centre of bilateral ties.

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