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Punatsangchhu-II Hydroelectric Project

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The Punatsangchhu-II Hydroelectric Project in Bhutan was jointly inaugurated by Prime Minister Narendra Modi of India and Bhutan King Jigme Khesar Namgyel Wangchuck on November 11, 2025.


Key Details and Latest Updates:
  • Full Commissioning: The final and sixth unit (170 MW) of the project was successfully synchronized with Bhutan's national power grid in August 2025, bringing the entire 1,020 MW project to full operational capacity.
  • Progressive Commissioning: The project's units were commissioned in stages, with the first and second in December 2024, the third in March 2025, the fourth in May 2025, the fifth in July 2025, and the final unit in August 2025.
  • Increased Capacity: The commissioning of PHEP-II has increased Bhutan's total installed power generation capacity by approximately 40%.
  • Energy Generation & Revenue: As of late August 2025, all six operational units had injected over 1.3 billion units of electricity into the national grid, generating revenues of approximately Nu 4.9 billion.
  • Partnership: The project is a major milestone in the long-standing energy partnership between India and Bhutan, funded by the Government of India with 30% as a grant and 70% as a loan.
  • Future Cooperation: The inauguration was part of a broader discussion on strengthening bilateral ties, with India reaffirming its support for Bhutan's 13th Five-Year Plan and future energy projects. 
The project also reinforces the energy partnership under the 2024 Joint Vision Document between India and Bhutan, which focuses on clean and sustainable energy initiatives.
Additionally, India's government has extended a β‚Ή4,000 crore credit line to Bhutan for energy projects, further supporting this bilateral collaboration.

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