Union Minister Manohar Lal arrived in Bhutan on a four-day visit that will concentrate on energy security and sustainable development. The visit was presented by the ministry as part of steps to deepen bilateral ties and to reinforce longstanding cooperation between the two countries. The programme included meetings with senior Bhutanese leaders to reaffirm commitments to clean energy collaboration.

He called on Prime Minister Tshering Tobgay and held discussions with Lyonpo Gem Tshering, the Minister for Energy and Natural Resources, on strengthening cooperation in the hydropower sector and exploring avenues in renewable energy and regional power trade. Discussions covered operational coordination, potential expansion of cross-border exchange and measures to enhance the resilience of electricity systems. Both sides agreed on the need for sustained engagement to support implementation of joint initiatives.

India and Bhutan have established an enhanced bilateral institutional framework mechanism to enable regular review and coordination of ongoing and future initiatives in the power sector. The mechanism will address areas such as non-hydro energy, cross-border transmission, project financing, capacity building and institutional partnerships. Officials indicated that this structure is intended to streamline decision making and to provide a platform for technical and financial cooperation.

During the visit the two sides signed the Tariff Protocol for the Punatsangchhu-II Hydroelectric Project and a Methodology for Reactive Energy Accounting to govern reactive power exchange and improve grid stability. The Punatsangchhu-II project has a capacity of 1,020 megawatt (MW) and was jointly inaugurated by Prime Minister Narendra Modi and King Jigme Khesar Namgyel Wangchuck on 11 November 2025. The project began exporting surplus power to India from 19 September 2025 at a mutually agreed starting tariff.

Engagements during the visit are expected to open new avenues for collaboration in clean energy, contributing to continued prosperity and the wellbeing of communities in both countries. The technical agreement on reactive energy accounting is intended to improve efficiency in cross-border electricity exchange and to streamline bilateral power trade. Further meetings during the four-day programme will focus on operationalisation of agreements and on supporting capacity building for sustainable energy projects.