India has announced a concessional credit line of Rs 4,000 crore (approximately $480 million USD) to Bhutan to fund energy projects in the country. This announcement was made during Indian Prime Minister Narendra Modi's two-day visit to Bhutan, where he held wide-ranging talks with Bhutan's King Jigme Khesar Namgyel Wangchuck.

The announcement underscores the strong and deepening ties between India and Bhutan, particularly in the energy sector. The credit line will support the development of various energy projects in Bhutan, further enhancing the country's energy production capacity and contributing to its economic growth.

During the visit, Modi and King Wangchuck jointly inaugurated the Punatsangchhu-II Hydroelectric Project, a 1,020-MW project constructed under a bilateral agreement. The electricity generated from this project will be supplied to both India and Bhutan. Modi noted that the Punatsangchhu-II project has increased Bhutan's total installed hydropower capacity by 40%.

In addition to the energy sector boost, the leaders discussed enhancing connectivity between the two nations, including the establishment of rail links to Gelephu and Samtse. Modi assured that the Indian officials have been instructed to ensure the timely completion of the rail projects.

Several new agreements were also signed in areas of renewable energy, healthcare, and mental health services. These agreements aim to further strengthen the bilateral cooperation between India and Bhutan and support Bhutan's socio-economic development. The leaders also witnessed the exchange of three Memorandums of Understanding (MoUs) in the fields of renewable energy, mental health services, and healthcare.

The announcement of the concessional credit line and the inauguration of the Punatsangchhu-II project highlight the continued commitment of India and Bhutan to strengthen their partnership and work together for mutual benefit.