Prime Minister Narendra Modi, on a two-day state visit to Bhutan (November 11-12, 2025), jointly inaugurated the 1,020 MW Punatsangchhu-II Hydroelectric Project with His Majesty King Jigme Khesar Namgyel Wangchuck on November 11, 2025.

The project enhances Bhutan's power generation capacity by nearly 40%. India announced a concessional Line of Credit of INR 40 billion (₹4,000 crore) for Bhutan's energy projects. Both sides agreed to resume work on the 1,200 MW Punatsangchhu-I project and signed MoUs on cross-border rail links (Gelephu-Kokrajhar and Samtse-Banarhat), renewable energy, and health cooperation.