Importing From India to Bhutan

India sold Bhutan goods worth US$1,264 million in 2024-25, up from under US$964 million the year before (Consulate General of India, Phuentsholing (opens in a new tab)). That's a lot for a country of under a million people, and it tells you how Bhutan shops. Most of what's on a shelf in Thimphu came up the road from India.

So a Bhutanese importer's questions are different from everyone else's on these pages. There's no sea lane, no hub and hardly any tariff to argue about. The questions are which agreement applies, what currency you pay in, and what the new 2026 tax means at the border. The caveat - we haven't read Bhutan's customs procedure in detail, so the land-border paperwork is for your broker to confirm.

Last researched 28 September 2026 · Next review 24 November 2026 · Written by SourcingFrom

The decision in brief is in the playbook: Exporting and trade → /india/#trade. The shared SAFTA rules are on the SAFTA bloc page.

1. Free Trade, Not a Preference

Bhutan doesn't need SAFTA for most Indian goods. The Agreement on Trade, Commerce and Transit, signed at Thimphu on 12 November 2016, provides for free trade between the two countries "as heretofore" (agreement text, commerce.gov.in (opens in a new tab), read 25 September 2026). It's the fifth revision of an arrangement first signed in 1972 (Consulate, as above). It runs for ten years from a start date the two sides agree, which the text doesn't give, so we can't tell you when the current term ends.

The useful part for you? Trade is settled in Indian rupees, which are at par with the ngultrum (Consulate, as above). No currency conversion, no dollar wire. That's rare, and it makes small, frequent orders from India far easier than from anywhere else.

2. Bhutan's GST Is the New Line on the Bill

From 1 January 2026 Bhutan charges a Goods and Services Tax at a single 5% rate on taxable supplies and imports, replacing the old sales tax and excise framework (Bhutan GST Rules 2026, Department of Revenue and Customs (opens in a new tab), Fonoa, 2026 (opens in a new tab)). Registration is compulsory above an annual turnover of Nu. 5 million. So if you used to budget for sales tax on Indian goods, rebuild the landed cost on the GST instead.

On the Indian side, a supply to Bhutan is an export, so your supplier can ship without charging Indian GST (under bond or a letter of undertaking). If an Indian invoice to you carries Indian GST, ask why before you pay it.

3. The Certificate Question

Because the bilateral agreement is free trade, its main text sets no certificate of origin for Indian goods. A SAFTA certificate only matters if you're claiming SAFTA, and the route for that is on the bloc page. What the border actually asks for on a normal Indian consignment is for your broker to confirm, and we'd ask before the truck leaves, not at Phuentsholing.

4. Back to the Shelf in Thimphu

India's exports to Bhutan grew by almost a third in a year, and that's the market you're buying in. The agreement is easy and the currency is the same. The new variable is GST, so get your pricing and your broker's paperwork right for 2026, and the rest is a trucking question.

Next Step

Every Indian agreement is on India's trade agreements.