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ShareTucked away, on the fringes of the Himalayas on one side and the Tibetan desert on the other, is the exquisite land of Bhutan.
Most locals still fondly recall how, in 1958, Jawaharlal Nehru and his young daughter decided to travel to this land - much of the journey on the backs of yaks.
That trip, as the Confederation of Indian Industry (CII) delegation to Bhutan discovered last week, began an incredible story of support and common benefits for both countries.
Bhutan has, since then, remained a protectorate of India. And India, in turn, has been Bhutan's largest supporter (see table: India to Bhutan's aid).
It is also the biggest trade partner. In 2005, for instance, imports from India stood at Rs.1,280 crore, accounting for 75% of Bhutan's imports.
Likewise, exports from Bhutan to India during the same year stood at Rs 997 crore (87.5% of total exports).
But the most enduring bondings between India and Bhutan have been those related to hydro-electric (hydel) power generation: Bhutan earns 30.2% of its export earnings through sale of electricity to India.
This percentage is likely to soar because both countries recently agreed to allow India to import almost 5,000 MW of hydel power from this country by 2020 (The potential estimated by Bhutan is 30,000 MW) as the latter enjoys the twin blessing of a large number of rivers and a very low population density.
That will benefit India in many ways:
First, India can source electricity at tariffs that are lower than those of new plants in the country. This is partly because power projects in India generally cost a lot more on a per installed MW basis than most projects in other countries.
While it may not be fair to compare costs between hydel plants - as each plant has significant variable costs on account of geological terrain-related expenses - this is definitely possible with thermal plants. These high capital costs translate into higher power tariffs for India.
Second, given the environmental concerns about displacement of people and the damage to the ecology, it is doubtful if any major hydel project will come up in the country in the near future.
Under the circumstances, it would be prudent for India to enter into such development plans with all its neighbouring countries so that it could purchase hydel power at significantly lower rates.
In fact, such a strategy would yield better dividends when compared with the investments India seeks to make in oil projects in politically unstable countries elsewhere.
A beginning has been made, a relationship established. More hydel power plants in Bhutan could strengthen ties even further in the coming decades.
