WT/COMTD/RTA25/M/1  
 
15 May 2023 
(23-3396) Page: 1/2 
Committee on Trade and Development  
Nine teenth  Dedicated Session on Regional Trade  
Agreements    
 
 
AGREEMENT ON TRADE, COMMERCE AND TRANSIT BETWEEN INDIA AND BHUTAN 
(GOODS)   
NOTE ON THE MEETING OF 5 APRIL  2023 
Chairperson: H.E. Ms. Usha Chandnee Dwarka -Canabady (Mauritius)  
 
1.  The 1 9th Dedicated Session on Regional Trade Agreements (RTAs) of the Committee on Trade  and 
Development (CTD) was convened in document WTO/AIR/COMTD/RTA/14/Rev.1 of 24 March 2023 . 
Under item  D (I) of the agenda, the Committee considered the Agreement on Trade, Co mmerce and 
Transit Between India and Bhutan (Goods) (WT/COMTD/RTA25/N/1, WT/COMTD/RTA25/1) . 
The present document contains the minutes relating to the consideration of th is agreement.1  
2.  The Chairperson  said that the Agreement on Trade, Commerce and Transit between India and 
Bhutan  was notified under paragraph 4(a) of the Enabling Clause by India on 30 June 2008. The 
notification was originally circulated on 2 July 2008 in document WT/COMTD/N/28, and then 
re-circulated on 13 October 2022 in document W T/COMTD/RTA25/N/1, in accordance with the new 
symbols for notifications and subsequent documentation relating to RTAs agreed to by the CTD at 
its 108th Regular Session on 5 April 2019. The factual presentation on th e agreement – 
document  WT/COMTD/RTA25/1 c irculated on 13 October 2022 – was prepared by the Secretariat on 
its own responsibility, and in full consultation with the parties. No written questions were received 
on this agreement before the present meeting.   
3.  The representative of India delivered the following statement:  
4.  We would like to thank the Secretariat for its efforts in preparing this factual presentation. 
The Secretariat engaged with us in detail  during the process , which was very helpful. As regard s this 
agreement, mutually beneficial economic ties have been the centrepiece of Bhutan -India relations. 
Currently, India is not only Bhutan 's main development partner, but also its leading trade partner. 
The objective of the agreement  is to further strength en the age -old ties and enhance bilateral trade 
and economic cooperation for the mutual benefit and development of the two countries. 
The India-Bhutan Agreement on Trade, Commerce and Transit was first signed in 1972, and since 
then has been continued from  time to time. It was revised most recently for the fifth time in 2016 
and establishes a free trade regime between the two countries. The current Agreement on Trade, 
Commerce and Transit between the Royal Government of Bhutan and the Government of the 
Republic of India is valid till 2026. The agreement also provides for duty -free transit of 
Bhutanese  exports to third countries. The two partners have been able to improve upon these 
provisions through the successive renewal of the agreement with the addition of new entry and exit 
points in India for Bhutan 's external trade. The progressive changes made in the scope of the 
agreement is r eflective of the economic and political progress that Bhutan has achieved over the 
past decades. The agreement factor s in the asymmetries in the sizes of the economies of India and 
Bhutan and s eeks to address the special needs of Bhutan, which is a landloc ked least developed 
country ( LDC). While the agreement aim s to promote free trade and commerce between the 
two countries, Bhutan was permitted , for the protection of its industries,  to impose non -tariff 
restrictions on the imports of certain goods of India n origin. All Bhutanese exports to, and imports 
from, third countries  are free from the customs duties and trade restrictions of India. Under the 
 
1 The general minutes of the CTD's 1 9th Dedicated Session on RTAs are contained in document 
WT/COMTD/RTA/M/ 19.  WT/COMTD/RTA25/M/1  
 
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  agreement, the exit and entry points for this purpose have been increased from 16 to 21. 
The agreement also pr ovide s for the movement of Bhutanese goods from one part of Bhutan to 
another part of Bhutan  through India.  
5.  India is Bhutan 's top trad ing partner both as an import source and as an export destination. 
Since 2014, India 's trade with Bhutan has almost tripled  – from USD 484 million in 2014 -2015 to 
USD 1422 million in 2021 -2022 – and account s for about 80% of Bhutan 's overall trade. India 's top 
exports to Bhutan are petrol and diesel ; passenger cars ; rice; wood charcoal ; cell phones ; coke and 
semi-coke; soya-bean oil ; excavators ; electric generators and motors ; parts for turbines ; transport 
vehicle s; and bitumen. India 's top imports from Bhutan  include  electricit y; ferro-silicon ; 
ferro-silico-manganese ; Portland  pozzolana cement ; dolomite chips ; ordinary Portland  cement ; 
silicon carbide ; cardamoms ; betel nut s; oranges ; semi-finished products of iron or non -alloy steel ; 
and boulders. Bilateral trade is conducted in Indian Rupees , which is fully convertible to Ngultrum 
at par. India is the leading source of investments in Bhutan, comprising 50% of the country 's total 
foreign direct investment ( FDI). There are about 30 Indian companies in Bhutan operating in various 
sectors including banking ; manufacturing ; electricity generation ; agri-food processing ; information 
technology enabled services ( ITES); pharmaceuticals ; hospitality ; and education. There are also 
provisions for the mutual refund on an annual basis of the excise duties on goods exported to each 
other. In view of the close ties of friendship between the two governments and its people, bilateral 
trade with B hutan has been instrumental in elevating socio -economic relations to new heights . 
6.  The representative of  the European Union  delivered the following statement:  
7.  The European Union would like to thank the parties for the transparency provided, and the 
Secretariat for the comprehensive factual presentation . 
8.  The representative of  the United States  delivered the following statement:  
9.  The Unites States would like to thank India and the Royal Government of Bhutan for th e 
notification, and for participating in  this very valuable transparency exercise .  
10.  The Chairperson  said that oral discussion of the Agreement on Trade, Commerce and Transit 
between India and Bhutan could be concluded in accordance with paragraph 11 of the Transparency 
Mechanism for RTAs (RTA TM ). Follow -up questions by Members would need to be submitted in 
writing to the Secretariat within one week, by 12 April 2023. The parties would then be given 
two weeks to submit written replies, by no later than 26 April 2023. In accordance with paragraph  13 
of the RTA TM, all written submissions as well as the minutes of the present meeting would be 
circulated promptly in all WTO official languages and would be made available on the WTO website.  
11.  The Committee took note  of all interventions . 
 
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