Foreign policy and defense
Bhutan has very close relations with India,
while contacts with China are strained. India and China
can be seen as competitors for the influence over
Bhutan, sandwiched between the two neighboring giants.
Relations with Nepal have long been hampered by a
conflict over Nepalese-displaced refugees in two camps
in eastern Nepal.
Bhutan's contacts with the outside world have long
been very limited. Throughout the 20th century, foreign
affairs were handled first by Britain and then India.
But in the 1960s, the country began to gently open
itself up to the outside world. Bhutan joined the UN in
Overview of business holidays and various national observances in Bhutan for years of 2020, 2021, 2022, 2023, 2024 and 2025.
Nowadays, Bhutan has formal diplomatic relations with
more than 50 countries, including Sweden, which are also
part of a group of European nations that account for a
significant portion of aid to the country. Diplomatic
relations have also been established with the EU.
Bhutan, on the other hand, lacks formal relations with
all the permanent members of the UN Security Council,
including China and the United States.
In February 2015, as the first US Secretary of State,
John Kerry held a meeting with Bhutanese government
representatives, including the then Prime Minister
Tshering Tobgay, in connection with a visit to India.
India is by far the most important trading and
cooperation partner. Two thirds of foreign aid comes
from neighboring countries. India's position as a
protective power was removed without obligation when the
two countries' special friendship agreements were
updated in 2007. Bhutan gained greater
self-determination on international and military issues,
and further strengthened economic cooperation. Among
other things, there is free trade and passport freedom
between the countries. India and Bhutan are also
cooperating on security issues along the border.
At the end of the 1990s, Bhutan encountered problems
with Indian resistance groups from Assam establishing
strongholds in the country's southeastern part. After a
series of failed negotiation attempts, the Bhutanese
army in 2003 went on offensive against the rebel forces.
The effort was successful. The rebels were driven out
and quantities of weapons seized. A number of rebel
leaders were sentenced to prison. During the 2010s,
there has been occasional reports that rebels from Assam
have occasionally returned to Bhutan.
Relations with China deteriorated drastically in
connection with the turmoil in Tibet in 1959, when
several thousand Tibetans fled to Bhutan. In the 1980s,
the two countries began discussions about the boundary
between them. They signed an agreement on peace in the
border area in 1998, but since then more than 20 rounds
of talks have been held without the border issue
completely resolved. Bhutan believes that the Chinese
have built roads into Bhutanese territory and that the
Chinese military has crossed the border on several
occasions. In 2017, the situation worsened when Bhutan
was supported by Indian military after Chinese soldiers
crossed the border at the disputed Doklam Plateau in
north-west Bhutan. For two months, the armies of China
and India faced each other in a post war in the mountain
area before the emergency situation was resolved.
During the 2010s, China and Bhutan have to some
extent approached each other, especially under the DPT
government that ruled Bhutan between 2013 and 2018.
Bhutan can be said to have become a tile in the game
between the two Asian giants India and China competing
for influence in South Asia. During the same period,
India has increased its aid and trade with Bhutan. In
April 2019, Bhutan rejected an invitation from China to
participate in a forum on Beijing's major infrastructure
initiative BRI (Belt and Road Initiative, or New Silk
Road), which extends from East Asia via Central and
South Asia to Europe.
Contact with Nepal has been tense since the late
1980s, when tens of thousands of people fled from
southern Bhutan to Nepal (see Population and Languages
and Modern History). However, in the 2010s, countries
began to negotiate trade and possibly establish
diplomatic relations. Trade with Nepal has increased
steadily in recent years.
Bhutan is a member of the regional cooperation bodies
Saarc (South Asian Association for Regional Cooperation)
and Bimstec (Bay of Bengal Initiative for MultiSectoral
Technical Cooperation). When the country hosted a summit
in Saarc in 2010, it was seen as a clear sign that the
previously isolated country now has a more active role
in regional and global contexts.
The army consists mostly of volunteers, but a certain
degree of military service also exists. The education is
run by India. A home defense force protects important
facilities. In addition, there is also a royal bodyguard
force, a semi-military police force and an armed
forestry force. A total of about 8,000 people.