Japan Provides 13.7 Billion Yen to Support Bhutan’s Hydropower Development

Japan is providing loans of around 13.7 billion yen ($90 million) to support Bhutan’s development of hydropower plants. The agreement, signed in February, will fund three new facilities designed to enhance Bhutan’s electricity supply and export capability, contributing to the country’s economic advancement and regional decarbonization efforts.

Japan has committed to providing approximately 13.7 billion yen (around $90 million) in loans for Bhutan’s hydropower project. This initiative, aimed at strengthening ties with Bhutan, was formalized through an agreement signed by Japanese Ambassador Keiichi Ono and Bhutanese Ambassador Vetsop Namgyel in New Delhi this past February.

The project involves the construction of three hydropower stations located in the districts of Samdrup Jongkhar and Samtse, which border India. Groundbreaking is anticipated to commence in May, with project completion expected by 2029, as reported by the Japan International Cooperation Agency.

Bhutan relies heavily on hydroelectric power, notably selling surplus energy to India during the rainy season from June to October, which constitutes approximately 40 percent of its annual export revenue. Due to rising energy demands fueled by economic growth, Bhutan faces challenges in maintaining a stable power supply, particularly during the dry season.

One of the new facilities will be a “storage hydropower” plant designed to store water in a reservoir, enabling Switzerland to manage timing for electricity production. A Japanese ministry representative emphasized that this facility will alleviate some of the energy shortages experienced during dry periods.

By facilitating stable energy supplies and enhancing power exports during monsoon seasons, Japan seeks to support Bhutan’s economic growth and promote social development, while also addressing decarbonization efforts in the Southwest Asian region. This project marks Japan’s first direct involvement in Bhutan’s hydraulic power sector.

Bhutan holds strategic importance to Japan, as it is a landlocked nation of nearly 800,000 people, emphasizing its Gross National Happiness index. Japan seeks to maintain amicable relations with Bhutan, particularly given its economic dependency on India and lack of diplomatic ties with China.

In conclusion, Japan’s financial commitment to Bhutan signifies a strategic partnership aimed at bolstering Bhutan’s energy autonomy and economic development. By investing in hydropower infrastructure, Japan not only facilitates energy exports but also supports environmental sustainability in the region. The project represents a significant step in enhancing diplomatic relations between Japan and Bhutan.

Original Source: english.kyodonews.net