Ties strained as India cuts fuel subsidy to Bhutan

July 6, 2013

India_cuts

New Delhi, Jul 6: Is this a case of diplomatic overkill or just the slow grind of the bureaucratic machinery? Five days ago, India withdrew all subsidy on cooking gas and kerosene being provided to Bhutan - arguably India's only unquestioned friend among its neighbours - creating a huge crisis in the tiny, landlocked kingdom and bringing the bilateral ties under strain.

Gas and kerosene prices have more than doubled in Bhutan, and predictably, this will hit the poor the hardest. The head of the interim government, Sonam Tobgye, has written to external affairs minister Salman Khurshid, seeking his intervention. Government sources here confirmed that Bhutan embassy had sought an appointment with Khurshid, who landed in Delhi only on Friday afternoon after his trip to Brunei and Singapore, to deliver the letter.

The subsidy cut has come against the backdrop of New Delhi smarting since last year when Bhutan PM Jigme Thinley appeared to be cosying up to Beijing. He had a meeting with the Chinese premier in Rio and also imported some 20 buses from China. India, which has historically supported Bhutan's foreign policy, including its membership to the UN, was taken by surprise.

The Thinley government has since played down his meeting with the Chinese leader, but not everyone in New Delhi seems convinced about its purported innocence. In fact, the mandarins here view it as a shift in Thimpu's foreign policy - a shift that appears to have been done at the instance of the elected Thinley government. However, it couldn't be ascertained whether the subsidy cut was linked to this.

Sources in Indian Oil Corporation told TOI that it stopped supplying subsidized gas and kerosene to Bhutan after it received a communication from the Indian government saying that henceforth it will not reimburse the subsidy component of fuels supplied there.

The subsidy cut has come bang in the middle of Bhutan's second election, scheduled for July 13. How big the impact of this is can be measured by the fact that the incumbent Druk Phuensum Tshogpa (DPT) party president and the last prime minister, Jigme Thinley, has cut short his campaign and returned to Thimpu. His pitch is that helping out the poor was more important than electoral campaigning.

Is the subsidy cut a considered step or some bureaucrat's ill-advised enthusiasm? Officials here are suggesting that since the Bhutan 10th Plan expired on June 30, the fresh terms of financial assistance, including subsidies, would have to be negotiated with the new government.

As it happens, apart from the China angle, New Delhi has also been miffed at the cost escalation of power projects in Bhutan which it is financing. In some cases, the cost has almost doubled, raising suspicions of some fund diversion.

India's reservations about Bhutan's policies under Thinley is said to be a key reason why New Delhi reacted very late to bail out the kingdom from its rupee liquidity crunch. It extended a standby credit facility of Rs 1,000 crore for Bhutan only in January this year during the visit of Bhutan king Jigme Wangchuck with whom New Delhi continues to enjoy excellent relations.

So, was the subsidy cut an effort to convey a message to Thimpu, more specifically to the Thinley dispensation? If so, the medium for the message could have been better chosen. The one-go subsidy cut isn't an ordinary step: it has affected over half the Bhutan population badly. What's more, it has enabled Jigme Thinley to brandish his patriotic credentials and could end up helping him in the elections.

As is well known, India isn't exactly loved by its neighbours for its alleged big-brotherly attitude. The exception has been Bhutan, which is sandwiched between two giants, India and China. While the tall Himalayas lie between Bhutan and China, it has an open border with India, as well as free trade, access of markets and cultural affinity.

While the Thinley regime might have introduced a thorn in the warm ties, the one-shot cut in subsidy may not help in bringing back the warmth. On the contrary, it might end up fanning an anti-India sentiment among the people there. So, while New Delhi's concerns seem justified, greater thought is required to handle the emerging problem.

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News Network
June 18,2020

New Delhi, Jun 18: Prime Minister Narendra Modi on Thursday launched the auction process for 41 coal blocks for commercial mining, a move that opens India’s coal sector for private players, and termed it a major step in the direction of India achieving self-reliance.

Launching the auction of mines for commercial mining, that is expected to garner ₹33,000 crore of capital investment in the country over next five to seven years, the Prime Minister said India will win the coronavirus war and turn this crisis into an opportunity, and the pandemic will make India self-reliant.

The launch of the auction process not only marks the beginning of unlocking of the country’s coal sector from the lockdown of decades , but aims at making India the largest exporter of coal, the Prime Minister said.

Presently, despite being the world’s fourth largest producer, he said India is the second largest importer of the dry-fuel.

“Allowing private sector in commercial coal mining is unlocking resources of a nation with the world’s fourth-largest reserves,” he pointed out.

Major scams had taken place in coal action earlier, but the system has been made “transparent” now, the Prime Minister said lambasting past policies of keeping the sector closed.

Mr. Modi said that this auction process will result in major revenues to states and create employment besides developing the far-flung areas.

The commencement of auction process of these blocks, part of the series of announcements made under ‘Atmanirbhar Bharat Abhiyan’, is likely to contribute ₹20,000 crore revenues annually to the state governments.

In line with the Prime Minister’s self-reliance call, the aim behind the auction process is to achieve self-sufficiency in meeting energy needs and boosting industrial development.

The government has taken an important decision to open up coal and mining sector to competition, capital and technology, he said.

Coal and Mines Minister Pralhad Joshi, who was also be present during the launch event, said ₹50,000 crore is being invested in the sector to jack up India’s coal output to 1 billion tonne.

With a view to achieve self-reliance in the coal sector, the Ministry of Coal in association with FICCI launched the process of auction of 41 coal mines under the provisions of Coal Mines (Special Provisions) Act and Mines and Minerals (Development and Regulation) Act.

Upon attainment of peak rated capacity of production of 225 million tonnes (MT), the government said, these mines will contribute about 15% of the country’s projected total coal production in 2025-26.

It will also lead to employment generation for more than 2.8 lakh people — direct employment to approximately 70,000 people and indirect employment to approximately 2,10,000 people, as per the government.

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News Network
June 24,2020

Thiruvananthapuram, Jun 24: Kerala on Tuesday was among those honoured for tackling the Covid-19 pandemic when the United Nations celebrated the Public Service Day.

The function, held on a virtual platform, saw the participation of UN Secretary General Antonio Guterres and other top UN dignitaries who applauded all the leaders which included state Health Minister K.K. Shailaja for effectively tackling Covid-19.

Speaking on the occasion, Shailaja noted that the experiences of tackling Nipah virus and the two floods - 2018 and 2019 - where the health sector played a crucial role, all helped in tackling Covid-19 timely.

"Right from the time when Covid cases got reported in Wuhan, Kerala got into the track of the WHO and followed every standard operating protocols and international norms and hence, we have been able to keep the contact spread rate to below 12.5 per cent and the mortality rate to 0.6 per cent," she said.

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News Network
June 22,2020

New Delhi, Jun 22: Defence Minister Rajnath Singh on Monday left for a three-day visit to Russia. Singh is likely to discuss the India-Russia defence and strategic partnership during the visit and also attend a military parade in Moscow to mark the 75th anniversary of the Soviet victory over Nazi Germany in the Second World War.

The visit comes days after the violent face-off with China in which 20 Indian Armymen were killed in Galwan valley in Ladakh.

"Leaving for Moscow on a three day visit. The visit to Russia will give me an opportunity to hold talks on ways to further deepen the India-Russia defence and strategic partnership. I shall also be attending the 75th Victory Day Parade in Moscow," the Defence Minister tweeted.

Defence Secretary Ajay Kumar is also accompanying the minister.

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