New Delhi, Sept 18: India and Bhutan today agreed to work closely to resolve the problem of Ulfa and other insurgent groups operating from Bhutanese soil in North- Eastern states as New Delhi announced an enhanced economic assistance package of Rs.1,614 crore during Bhutan's ninth five year plan. "There was a cordial exchange of views on wide-ranging issues of mutual interest and concern, including the presence of Indian insurgent groups in Bhutan and the measures being undertaken by the Royal Government of Bhutan to persuade the militants to leave its territory," a joint statement issued at the end of the five-day state visit by King Jigme Singye Wangchuk here said.

"Both sides agreed to continue working closely for resolving the issue," it said. The two governments reiterated that as "close friends and allies", they will not allow their territories to be used by anyone for carrying out activities that were harmful to each other's national interests, the statement said. The Bhutanese King, who held extensive parleys with Prime Minister Atal Bihari Vajpayee, his Deputy L K Advani and finance and external affairs ministers, flew back home this afternoon.

It was agreed that India will continue to assist Bhutan's economic development programmes, including the harnessing of its water resources. It was also decided that New Delhi will continue to purchase excess power generated by Bhutan's hydropower projects.

Describing the King's visit as a "milestone" in the close and friendly ties between India and Bhutan, "which stand out today as a model of good neighbourly relations," the statement said it has also contributed to further enhancing the mutual understanding, trust and friendship between the governments, leaders and people of the two countries.

Recalling the strong and historical ties of friendship and understanding between the two countries, it noted with satisfaction the "excellent state of relations" and mutually beneficial cooperation that they enjoy. Both sides expressed their firm commitment to further strengthen bilateral ties in the coming years.

During the visit, a memorandum of understanding was signed by External Affairs Minister Yashwant Sinha and his Bhutanese counterpart Lyonpo Khandu Wangchuk for the preparation of a detailed project report on the Punatsangchu Hydroelectric Power Project.

Bureau Report