Why in news?
The governments of Bhutan and India recently signed shareholder and concession agreements to build the 570 megawatt Wangchhu hydroelectric project in western Bhutan. The joint venture brings together Druk Green Power Corporation (DGPC) of Bhutan and Adani Power Limited of India, with construction slated to begin in 2026.
Background
Hydropower is central to Bhutan’s economy and its partnership with India. The Jaldhaka project in the early 1960s was the first collaborative venture, followed by major schemes like Chukha (1987), Tala (commissioned in the 2000s) and Punatsangchhu. Under a 2006 agreement, the two countries aim to develop 10,000 MW of hydropower in Bhutan. The Wangchhu project will be the first to be executed on a Build‑Own‑Operate‑Transfer (BOOT) model by a private Indian company.
Project details
- Location and design: The Wangchhu (also called Wongchu) river flows from the Himalayan glacier down to Chhukha district, where the project will harness its flow as a peaking run‑of‑river plant. The scheme will have four 142.5 MW units, giving a total installed capacity of 570 MW.
- Financials and timeline: The project is estimated to cost around ₹60 billion. Construction is expected to commence in early 2026, with completion targeted within five years. After a 25‑year concession period, ownership will transfer to the Royal Government of Bhutan.
- Benefits: During winter Bhutan experiences electricity shortages when rivers have low flow. The Wangchhu plant will provide firm peaking power for domestic consumption, while surplus energy in summer will be exported to India. The venture also offers employment and capacity‑building opportunities for Bhutanese engineers.
- Environmental considerations: Being a run‑of‑river scheme, the project will have a smaller reservoir and reduced submergence compared to storage dams. Nevertheless, careful planning is required to minimise impacts on local communities and aquatic ecosystems.
Significance for bilateral relations
India is Bhutan’s largest trading partner and has long supported its hydropower development. The Wangchhu project, executed under a public–private partnership, symbolises a maturing relationship where private sector expertise supplements government‑to‑government cooperation. Successful completion will strengthen energy security for both countries and set the stage for future collaborations.
Conclusion
By harnessing the swift waters of the Wangchhu river, Bhutan and India are deepening their energy partnership. The project’s timely execution, environmental stewardship and fair sharing of benefits will determine its success and could serve as a model for cross‑border renewable energy projects.
Source: BS