Sixth Annual Bhutan India Development Cooperation Talks

The Sixth Annual Bhutan-India Cooperation Talks was held in 1st-2nd September, 2010 in New Delhi. The Talks were led by Mr. Daw Penjo, Foreign Secretary, Ministry of Foreign Affairs and its delegation members included Mr. Lam Dorji, Secretary, Ministry of Finance, Mr. Karma Tshiteem, Secretary, GNH Commission and other government officials from relevant ministries and agencies. During the talks, the two governments reviewed the progress of projects implemented under Government of India (GoI) assistance- namely those which are under Project-Tied Assistance (PTA), as well as non-plan projects (Bhutan Institute of Medical Sciences and Chiphen Rigphel).

In the 10th FYP, the GoI is contributing financial aid in the form of Programme Grants (Nu. 7,000 million), Small Development Projects (Nu. 7,000 million) and Project Tied Assistance (Nu. 20,000 million). As of date, Nu. 9,652.652 has been disbursed by the GoI.

The Talks were preceded by the Project Monitoring Committee (PMC) meeting which took place on 28th July, 2010 in Thimphu, which pertained mainly to the present progress/status of the projects under PTA. The PMC noted the likelihood of projected cost escalations taking place and it was agreed that for the time being all projects would be implemented as per the cost estimates approved during the 5th Annual Plan Talks held in October, 2009. Any cost escalations would have to be reprioritized within the PTA ceiling of Nu. 20,000 million. It was thus raised during the Talks that there are several cost escalations, most of which are due to low initial cost estimates in the beginning of the Plan. The RGoB will be further scrutinizing the projects’ scope and cost estimates and the results would be further deliberated at future meetings of the PMC and Bhutan-India Cooperation Talks. It was also reiterated that the completion of the sixty eight projects under the PTA are the most crucial for defining the overall success of the 10th FYP.

During the discussions, the GoI reassured its support to the successful completion of the 10th FYP-the first plan under the newly elected democratic government and to Bhutan’s overall development process. India would continue to play the leading role in the socio-economic development of Bhutan.

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