As India and China compete to power South Asia’s energy transition, the decisive factor is not who has more capital. It is who can deliver. This report argues that the two countries’ delivery models, not their resources, explain the diverging outcomes across Bhutan, Nepal, and Bangladesh. India’s approach is relationship-intensive and conditional, built on sovereign Lines of Credit negotiated case by case. China’s is capital-intensive and vertically integrated, with state-owned enterprises controlling financing, engineering, and equipment supply from start to finish.

The consequences are visible across the region. Bhutan remains an anchor of Indian influence. Nepal is a genuine two-way contest, where Chinese brands captured over 80 percent of a booming electric vehicle market before a dramatic tax reversal in 2026. Bangladesh is the central case: through three very different governments since 2024, Dhaka has moved steadily toward Beijing, reassigning projects such as the Mongla economic zone and the Teesta river program after years of Indian inaction. The report shows these losses were execution failures before they were diplomatic ones.

Drawing on verified trade, market, and supply chain data, the analysis also examines the dual-use security risks of connected clean technology, India’s near-total dependence on Chinese-processed inputs, and the partnerships with Japan, Australia, and the EU that could ease it. It closes with practical recommendations, sequenced by instrument and time horizon, for closing the delivery gap while the deeper industrial asymmetry is addressed.