AGP Executive Report

Climate Resilience: Bhutan’s hydrology agency successfully tested a pilot siphon at Thorthormi Glacial Lake, achieving stable water flow. The low-cost, environmentally friendly system could help reduce glacial flood risk, with full-scale work still to be planned. Regional Security: Bhutan joined other BIMSTEC members in adopting the Delhi Declaration and five initiatives targeting terrorism, trafficking, drug smuggling, illicit finance and disaster preparedness. India–Bhutan Partnership: India handed over Nu 2.9 billion for projects under Bhutan’s 13th Five Year Plan, supporting education, healthcare, digital skills, infrastructure and renewable energy. Officials also reviewed ongoing projects, including bridges, electric vehicles, schools and a specialist hospital.

Regional Security: Bhutan is part of the first BIMSTEC home ministers’ meeting in New Delhi, where members are discussing cooperation against terrorism, organised crime, drug trafficking and other cross-border threats. Aquaculture Innovation: Bhutan’s first flow-through aquaponics prototype is planned for Haa, pairing rainbow trout farming with soilless crops and testing ways to reuse nutrient-rich water. Tourism: Bhutan won 11 honours at the 2026 South Asian Travel Awards, retaining Best Leading Heritage Destination for a second year. Hydropower: ANDRITZ will supply turbines and related equipment for the 600 MW Khorlochhu project, expected to generate 2.524 terawatt-hours of renewable power annually. Digital Payments: Some Bhutanese users still cannot pay reliably by UPI in India because not all merchants’ banks accept payments from Bhutanese banking apps; six Indian banks currently support the service.

Regional Security: Bhutan is expected at the first BIMSTEC home ministers’ meeting in New Delhi on October 13, where members will discuss cooperation against terrorism, trafficking, narcotics and cyber threats. Hydropower: ANDRITZ will supply four turbine-generator units for the 600MW Khorlochhu project, while Druk Green and Adani Power have agreed to develop the 770MW Chamkharchhu-I project. Digital Payments: Bhutanese users still face failed UPI transactions in India because some merchants’ banks are not enabled; officials say the rollout is expanding. Tourism: Bhutan won 11 honours at the 2026 South Asian Travel Awards, retaining Best Leading Heritage Destination for a second year. Investment and Finance: Bhutan has secured Nu 329.16 billion in FDI commitments, and DK Bank received in-principle approval to expand into Abu Dhabi.

Regional Trade: Bhutan and Northeast India are looking to deepen trade through better transport links and cooperation in education, tourism, healthcare and technology. India also discussed using the Brahmaputra and Jogighopa terminal to give Bhutan another route to global markets. Mental Well-being: A call to make mental health central to Bhutan’s development agenda argues that Gross National Happiness cannot be realised while stigma keeps people from seeking help. Investment: Bhutan has secured licences and in-principle approvals for Nu 329.16 billion in foreign investment projects—about two-thirds of its Nu 500 billion target for 2029, though approvals do not mean the money has been invested. Electricity Bills: The government has paused proposed tariff changes pending a cost review and set aside Nu 400 million to cushion low-voltage consumers. Digital Payments: Bhutanese users have completed 8,621 UPI transactions in India, but failures persist; six Indian banks are enabled, with more expected to join. Hydropower: Druk Green and Adani Power have agreed to develop the 770 MW Chamkharchhu-I project.

Trade Links: Bhutan and India are exploring the Brahmaputra waterway and Jogighopa terminal as a route to global markets, with the Manas and Sankosh rivers also under discussion. Investment: Licensed and in-principle approved FDI projects total Nu 329.16 billion—65.8% of Bhutan’s Nu 500 billion target for 2029. The figure reflects approved project value, not money already invested. Digital Payments: More than 8,600 UPI transactions have gone through since September, but some payments still fail. Four more Indian banks, including SBI, are expected to join. Public Services: The Seventh Pay Commission began work on October 1, while the government has set aside about Nu 400 million to support low-voltage electricity users. Energy: Druk Green Power and Adani Power have agreed to develop the 770 MW Chamkharchhu-I hydropower project.

Trade and Connectivity: Bhutan and India are exploring inland waterways on the Brahmaputra, including Assam’s Jogighopa terminal, as another route for Bhutanese goods to reach global markets. Investment: Bhutan has secured licences and in-principle approvals for Nu 329.16 billion in FDI projects—65.8% of its Nu 500 billion target for 2029, though approvals do not mean the funds have been invested. Public Sector: The Seventh Pay Commission was constituted on October 1 to recommend changes to public servants’ salaries and benefits. Separately, the government has allocated about Nu 400 million to support low-voltage electricity users. Digital Payments: More than 8,600 UPI transactions have been completed since September, but some payments in India still fail as banks work on integration. Energy and Finance: Druk Green Power and Adani Power have agreed to develop the 770-megawatt Chamkharchhu-I hydropower project. DK Bank has also received in-principle approval to expand into Abu Dhabi. Regional Diplomacy: Nepal has endorsed Bhutan’s Sonam Tobgay for the post of SAARC secretary-general.

Regional Diplomacy: Nepal has endorsed Bhutan’s nominee, Sonam Tobgay, for SAARC secretary-general, with all member states reportedly agreeing to the appointment. Finance and Business: Bhutan has licensed or provisionally approved Nu 329.16 billion in foreign investment projects—about two-thirds of its Nu 500 billion target for 2029. DK Bank has also received in-principle approval to expand into Abu Dhabi. Cross-Border Payments: More than 8,600 UPI transactions have been completed since September, but Bhutanese users still face failures at some Indian merchants as banks work on integration. Public Services: The Seventh Pay Commission was constituted from October 1 to review public-sector salaries and benefits. The government has also allocated about Nu 400 million to support low-voltage electricity users. International Travel: A US visa policy report lists Bhutan among 19 countries facing a full suspension of visa issuance. Energy: Druk Green Power and Adani Power have agreed to develop the 770-megawatt Chamkharchhu-I hydropower project, while KEC International has secured an order for a 400-kilovolt transmission line in Bhutan.

Public Finance: Bhutan has constituted its Seventh Pay Commission, chaired by Druk Green Power Corporation managing director Chhewang Rinzin. The government also allocated Nu 400 million to support low-voltage electricity users. Investment: Licensed and in-principle-approved foreign investment projects total Nu 329.16 billion, or 65.8% of the Nu 500 billion target for 2029; the figure reflects approvals, not capital already invested. Digital Payments: Bhutanese users have completed 8,621 UPI transactions since September, but payment failures persist at some Indian merchants as banks work to complete integration. Business and Energy: Adani Power and Druk Green Power agreed to develop the 770-megawatt Chamkharchhu-I hydropower project, while KEC International won an order for a 400-kilovolt transmission line in Bhutan. Regional Diplomacy: Nepal endorsed Bhutan’s Sonam Tobgay for SAARC secretary-general, with all member states reported to support his appointment.

Energy: The government has allocated Nu 400 million this financial year to support low-voltage electricity consumers as it reviews domestic power tariffs. KEC International also won an order for a 400 kV transmission line in Bhutan, part of Rs 1,030 crore in new contracts. Regional Ties: Bhutan and India are seeking practical gains in trade, connectivity, education, tourism and health. At a maritime dialogue, officials also discussed using India’s waterways and the Jogighopa terminal to improve Bhutanese cargo access to global markets. Hydropower: Druk Green Power and Adani Power have agreed to develop the 770 MW Chamkharchhu-I project, a major addition to Bhutan’s hydropower pipeline. Finance: DK Bank has received in-principle approval to establish an Abu Dhabi subsidiary, but needs a final licence before it can operate there. Governance & Resilience: Bhutan is looking to strengthen anticipatory governance, while a new regional assessment with India, Nepal and Bangladesh identifies heat-preparedness gaps as El Niño raises the risk of extreme heat.

Infrastructure: KEC International’s new ₹1,030 crore order package includes a 400 kV transmission line in Bhutan, marking the company’s return to the market. Finance: DK Bank has won in-principle approval to establish an Abu Dhabi subsidiary offering financial services, but still needs a final licence. The move could connect Gelephu Mindfulness City with international investors. Regional Trade: At India’s Sagarmanthan dialogue, Bhutan and India discussed using National Waterway-2, the Jogighopa terminal and the Manas and Sankosh rivers to improve Bhutanese cargo access to global markets. Governance: A regional dialogue in Thimphu focused on helping governments anticipate technological, climate and economic shifts and prepare public institutions. Energy: Adani Power and Druk Green Power have agreed to develop the 770 MW Chamkharchhu-I hydropower project.

Finance: DK Bank has won in-principle approval to establish an Abu Dhabi subsidiary offering financial services, but must secure a final licence before it can operate. The bank says the move could connect Gelephu Mindfulness City with international investors. Diplomacy: US Ambassador Sergio Gor met Bhutan’s King and Prime Minister to discuss investment, innovation and cooperation, including opportunities linked to Gelephu. Trade Links: Bhutan and India discussed using National Waterway-2 and the Jogighopa terminal to move Bhutanese cargo to global markets, alongside maritime training. Governance: A regional dialogue in Thimphu urged governments to anticipate shifts in technology, climate and the economy and prepare public institutions in advance. Climate: Bhutan joined India, Nepal and Bangladesh in releasing assessments of heat risks and gaps in preparedness as El Niño raises concern about another severe heat season. Energy: Adani Power and Druk Green Power agreed to develop the 770MW Chamkharchhu-I hydropower project. KEC International also secured an order for a 400kV transmission line in Bhutan. Payments: Bhutan’s central bank signed an agreement with Cambodia’s National Bank to explore cross-border digital payments.

US-Bhutan Ties: US Ambassador Sergio Gor met King Jigme Khesar Namgyel Wangchuck and Prime Minister Tshering Tobgay to discuss investment, innovation and cooperation, including US engagement with Gelephu Mindfulness City. Finance: Bhutan-based DK Bank has received in-principle approval to establish an Abu Dhabi subsidiary for brokerage, custody, payments and advisory services. It must secure final regulatory permission before opening. Digital Payments: Bhutan’s Royal Monetary Authority and Cambodia’s central bank signed an agreement to develop cross-border payments, with both sides aiming to begin cooperation soon. Hydropower: Druk Green Power and Adani Power signed a shareholders’ agreement for the 770 MW Chamkharchhu-I project in Zhemgang. Construction is expected to start in the first half of 2027, with the project targeted to come online six years after work begins.

Digital Finance: Bhutan’s Royal Monetary Authority and Cambodia’s National Bank signed an MoU to develop cross-border payments, aiming to make digital transactions between the countries easier. Hydropower: Adani Power and Druk Green Power Corporation agreed to develop the 770 MW Chamkharchhu-I project in Zhemgang through a 49:51 partnership. Construction is expected to begin in the first half of 2027. Youth and Jobs: Pelsung marked its first anniversary after training nearly 1,000 young people, with participants already developing projects for Gelephu Mindfulness City, including a zero-waste initiative. Economic Outlook: The Asian Development Bank expects Bhutan’s growth to accelerate to 7.2% in 2027.

Hydropower Deal: Adani Power and Bhutan’s state utility Druk Green Power (DGPC) signed the Shareholders Agreement for the 770 MW Chamkharchhu-I hydropower project in Zhemgang, using a 49:51 equity split under a 30-year BOOT concession; construction is expected to start in the first half of 2027 with commissioning targeted within six years, aiming to meet Bhutan’s winter peak needs and export surplus power to India in summer. Regional Diplomacy: Nepal’s Home Minister Sudhan Gurung is set to visit New Delhi on Oct 12 for the inaugural BIMSTEC Home Ministers’ meeting (Oct 13), focusing on cross-border security cooperation including terrorism, transnational crime, and disasters. Policy & Health: Bhutan’s BFDA is pushing amendments to the Tobacco Control Act that would ban vaping products, tighten rules for minors, and explore an import-authorisation system for testing tobacco and nicotine products before approval. Education & Mobility: New Australian student visa rules are making many Bhutanese students rethink plans, especially due to limits on bringing partners or children. Culture & Community: A Thimphu train-the-trainer programme is bringing cricket coaching into monastic institutions, training monks and nuns to run regular sessions locally. Environment & Lifestyle: A study finds Himalayan monals are changing their calls in noisier areas, while a travel feature offers a “day in Thimphu” experience for visitors. Economy Snapshot: The Asian Productivity Organization released its 2026 Productivity Databook, including full productivity accounts for Bhutan and projections for Asia through 2035.

Hydropower Deal: Adani Power and Bhutan’s DGPC signed the Shareholders Agreement for the 770 MW Chamkharchhu-I hydropower project in Zhemgang, using a 49:51 equity split under a 30-year BOOT concession; construction is expected to start in the first half of 2027 with commissioning targeted within six years, aiming to meet Bhutan’s winter peak needs and export surplus power to India. Regional Security & Cooperation: Nepal’s Home Minister Sudhan Gurung will visit New Delhi for the inaugural BIMSTEC Home Ministers’ meeting on Oct 13, with discussions focused on cross-border security, transnational crime, and disaster/climate cooperation. Digital Governance: South Korea discussed AI-powered procurement with Asian partners at a Bhutan-hosted Asia-Pacific public e-procurement forum in Thimphu, highlighting intelligent, fair, and transparent procurement. Sports in Monasteries: Bhutan Cricket Council launched a train-the-trainer programme in Thimphu, training about 50 monks and nuns from 22 monasteries and six nunneries to run cricket sessions locally. Agriculture & Seeds: Bhutan is training SAARC experts in hybrid vegetable seed production in Yusipang, targeting tomato and chilli to cut reliance on imported seeds and improve farm resilience.

Hydropower Deal: Adani Power and Bhutan’s state-owned Druk Green Power Corporation (DGPC) signed a Shareholders Agreement for the 770 MW Chamkharchhu-I Hydroelectric Project in Zhemgang, using a 49:51 equity split and a 30-year BOOT concession; construction is expected to start in early 2027 with commissioning targeted within six years, aiming to meet Bhutan’s winter power needs and enable summer exports to India. Regional Security Diplomacy: Nepal’s Home Minister Sudhan Gurung will visit New Delhi on Oct 12–14 for the inaugural BIMSTEC Home Ministers’ meeting, focusing on cross-cutting security cooperation including terrorism, transnational crime, and disaster/climate coordination. Digital Cooperation in Asia-Pacific: Paro hosted PRF-26 discussions on strengthening digital infrastructure and online safety, with emphasis on data protection, cybersecurity, and digital inclusion alongside innovation. Bhutan Economy & Energy Outlook: The ADB projects Bhutan’s growth at 7.2% for 2027, supported by tourism and industry/electricity momentum, while agriculture remains weather-sensitive. Agriculture & Seeds: Bhutan is training SAARC experts in hybrid vegetable seed production (tomato and chilli) to reduce reliance on imported seeds and improve farm resilience.