This article covers trade and investment between India and Bhutan: recent trade figures, the goods traded, the rules and border points that govern trade, Indian investment in Bhutan, electricity trade and financial support. It draws on the Ministry of External Affairs (MEA) brief of June 2026, and the figures are those the brief gives for the periods it states.

Trade in 2024 and 2025

According to the MEA brief of June 2026, India's exports to Bhutan increased in 2025 by 9% to Nu. 110.15 billion, from Nu. 101.30 billion in 2024. These exports consisted primarily of:

  • electricity and petroleum fuel
  • food, wood charcoal, and coke and semi-coke
  • ferrous products and soybean oil
  • automobiles and smartphones

Bhutan's exports to India increased in 2025 by about 18% to Nu 59.53 billion, from Nu 50.43 billion in 2024. They mainly consisted of electricity, ferro-silicon, wood products, agricultural produce, dolomite and gypsum.

India's share of Bhutan's trade

The brief states that India has consistently been Bhutan's top trading partner, both as an import source and as an export destination. It records that India's trade with Bhutan has nearly quadrupled, from USD 484 million in 2014-15 to USD 1744.44 million in 2024-25, and that this accounts for about two thirds of Bhutan's foreign trade.

Trade and transit agreement

The 2016 India-Bhutan Agreement on Trade, Commerce and Transit establishes a free trade regime between the two countries. It also provides Bhutan duty free transit of goods to and from third countries.

Ten entry and exit points, known as Land Customs Stations (LCS), have been notified on the India-Bhutan border for trade between the two countries. Of these, LCS Jaigaon-Phuentsholing accounts for almost 70% of Bhutan's total trade, as of the brief.

Commerce Secretary Level Meeting

Commerce Secretary Shri Sunil Barthwal and Dasho Tashi Wangmo, Secretary, Ministry of Industry, Commerce and Employment of Bhutan, co-chaired the India-Bhutan Commerce Secretary Level Meeting (CSLM) in Thimphu on 27-28 September 2024. Key decisions of the meeting included:

  • notification of LCS Hatisar and LCS Darranga as additional routes for the import of areca nut into India from Bhutan
  • notification of LCS Darranga as an additional Point of Entry for the import of food items into India from Bhutan
  • establishment of border haats along the India-Bhutan border
  • inclusion of three additional species of timber for import from Bhutan to India
  • deployment of Phyto Quarantine Inspection Services (PQIS) at LCS Darranga

The seventh meeting of the Joint Group on Customs was held in India in April 2026 to streamline customs matters between the two sides. Following the meeting, Samrang has been notified as an LCS between the two countries.

Indian investment in Bhutan

India remains the leading source of investment in Bhutan, accounting for over 55% of the country's total Foreign Direct Investment (FDI), according to the brief. There are currently about 30 Indian FDI companies in Bhutan, in banking, manufacturing, electricity generation, agri and food processing, ITES, pharmaceuticals, hospitality and education.

In banking, the Druk PNB Bank in Bhutan has 51% shareholding from Punjab National Bank, India. The Bank of Bhutan has 20% equity participation from the State Bank of India.

Electricity trade

The brief describes electricity trading as a growing field between the two countries. Bhutan exports power to India during its surplus season and imports power from India during the lean period every year. In 2025, electricity exports by Bhutan to India realised INR 2471 Crore.

India has since facilitated access for the Basochhu, Nikachhu and Suchhu hydroelectric projects to trade on the Day Ahead and Real Time Markets of the Indian power exchanges.

Currency swap and standby credit

Under the SAARC currency swap arrangement, the Reserve Bank of India (RBI) signed a USD 200 million INR equivalent arrangement with Bhutan's Royal Monetary Authority (RMA) in November 2022. The RBI has started a new Framework on Currency Swap Arrangement (FCSA) 2024-27 for SAARC countries. Under this framework, Bhutan has availed INR 1500 crores (15 Billion) under the INR window for a period of 6 months.

On Bhutan's request, the Government of India agreed to reduce the rate of interest on two Standby Credit Facilities, of INR 300 crores (3 Billion) and 400 crores (4 Billion), from 5% to 2.5% with effect from 1 July 2022. India has also extended an additional Standby Credit Facility of INR 300 crores (3 Billion), which Bhutan has availed since 29 November 2023.

Business events

Bhutanese ministers have taken part in business events in India. Lyonpo Namgyal Dorji, Minister of Industry, Employment and Commerce, visited New Delhi for the Bhutan Investment Roadshow in January 2025, and attended the inauguration at the Jogighopa Multi-Modal Logistics Park in Assam in February 2025. In February 2025, Lyonpo Younten Phuntsho, Minister of Agriculture and Livestock, represented the Royal Government of Bhutan at the Bengal Global Business Forum in Kolkata and at Advantage Assam 2.0 in Guwahati.

Earlier, Union Minister of Commerce & Industry Shri Piyush Goyal visited Bhutan for the first India-Bhutan Startup Summit in February 2020.