Why does India import electricity even though it has become a power surplus nation by 2015?

Answer 1

According to India's Ministry of Power, the country runs a small net export surplus of 1848.95 Million Units (source: https://pib.gov.in/PressReleasePage.aspx?PRID=1607177) with exports to Nepal, Bangladesh, and Myanmar. However, this net includes imports from Bhutan of 6,165.78 Million Units per fiscal year.

To understand why the country imports electricity at all, we need to understand the effects of geopolitics, risk, business, and the environment rather than engineering. First, Bhutan is considered an ally of India, but as it borders China, it is susceptible to be influenced by the tug-of-war between the two nations. Having Bhutan's economy benefit by exports to India improves the relationship between the two nations and incentivizes them to support India on larger matters. Second, India's electric grid is archaic and the endless population growth means their domestic electric generation capability is continually stretched. In the event of any internal or external calamity, the risk is high of blackouts. By importing some electricity, they diversify and dilute the risk of internal calamities and are better prepared for sudden increases in demand. Third, most of Bhutan's exports comes from a series of hydroelectric dams. Some of these dams are joint ventures between the government and large Indian companies such as Tata. So the financial success of these dams ensures financial opportunities for Indian companies. Lastly, since dams are considered more environmentally friendly than coal or gas fired power plants, India can claim progress towards their environmental goals at the world stage. In short, there are continued benefits for India to import from their neighbors even if they are able to fully meet their domestic demand themselves.