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India Bhutan Free Trade Agreement


The Government of India and the Royal Government of Bhutan reffered to as "contracting Parties". According to the agreement on trade and commerce between both of the country, there is free trade and commerce between the two countries of goods produced in either country. Each of the Government agree to provide appropriate refund in respect of excise duties on goods of its origin exported to another.


For project-imports, the value of imports to Bhutan and in hard currency is deducted from the total value of imports as claimed in documents received. This is divided into two categories:

  • Export goods to Bhutan for govt. aided projects.
  • Refund of excise duty


  • There should be free trade and commerce between the territories of the Royal Government of Bhutan and the Government of the Republic of India.
  • The Royal Government of Bhutan impose such non-tariff restrictions on the entry into Bhutan of certain goods of Indian origin as may be necessary for the protection of industries in Bhutan. These restrictions, however, will not be stricter than those applied to goods of third country origin.

Exports and imports of Bhutan to and from countries other than India will be free from and not subjected to customs duties and trade restrictions of the Government of India.


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