Tourism was one of the first subjects that was discussed in the National Council (NC) on November 15th, 2024 as the House’s Economic Affairs Committee, presented its Interim Report on the Review of State of Tourism in Bhutan. While lauding the work undertaken by the Committee, NC members recommended several important areas that the Committee could study hereon.
The NC’s Eminent member, Phuntsho Rabten, informed that during the discussions on the Tourism Levy Bill 2022, some of the important foundations of the discussions were issues such as undercutting in the Tourism industry and “abroad partners.” He spoke about the existence of such partners, who siphoned bulk of the profit by charging tourists high, while paying less to agents in Bhutan and recommended inclusion of these aspects in the Committee’s study. The member also told the Committee that inclusion of other aspects, such as, employment generated by tourism, finding out clearly how many tourists paid the sustainable development fee (SDF) in dollars and other currencies and how many came through air and road would be important.
The member also recommended that the Committee study if the recent move of the government to reduce airfare for dollar paying tourists in selected months has any impact and if there are other measures to do the same.
Member of the NC from Trashigang Dzongkhag Sonam Tobgyel said, “The government has been working on the legislation of the tourism act, but there aren’t any specific guidelines on how to implement it. It is not included anywhere.” In addition, the MP questioned the committee on their future plans and the way forward.
MP Sonam also highlighted the importance of having a strong tourism act so that outsiders can trust the system of the country, rather than seeing frequent changes, like it happened with the SDF (Sustainable Development Fee).
Member of Parliament (MP) Kencho Tshering of Bumthang Dzongkhag said, “One reason tourists visit the country is because of our tradition and culture, however, there are challenges that could lead us to lose those traditions, as not many in the younger generation show interest. It is crucial for the government to address this.”
“There are various traditions in remote areas, and I recommend that the government provide incentives to preserve these cultures and traditions,” Kencho added.
Similarly, Deputy Chairperson of the National Council (NC), Dago Tshering La of Haa, emphasized the need for the committee to conduct proper research and study on who truly benefits from tourist visitors in the country. “The benefits should accrue to both the country and the people, however, I doubt if this is happening, so we need to reassess this aspect,” he said.
Dago also highlighted the importance of local government and local people working together for effective strategies and plans. “It is important for the dzongkhag to think outside the box, with a focus on marketing, among other things,” he added.
Meanwhile, MP Birendra Chimoria of Dagana said, “It is important for the dzongkhag to approve businesses that are appropriate for tourist attraction, which will also promote equal regional development for tourism.”
MP Ugyen Tshering of Paro stressed the importance of having adequate infrastructure and effective policies in place for tourists in the country.
“The issue of equal regional tourism development has been a significant question mark regarding how to provide the best facilities to guests, as they pay fees while visiting. It is also essential to consider the culture of the country,” said MP Tshering of Gasa.
MP Phub Dorji of Wangdue Phodrang highlighted the importance of proper waste management to put in place.
“It is crucial to focus on promoting adventure tourism by reducing the SDF,” said MP Pema Tashi of Sarpang, adding that, it is also important for guides to receive proper training.
Meanwhile, the Committee’s Chairperson, MP Tsewang Rinzin’s presentation to the House touched on several aspects of the tourism industry. The findings state that Bhutan’s tourism sector is steadily recovering after being severely affected by the pandemic. As of June 30, 2024, Bhutan received 75,608 tourists, a 47% increase compared to the same period in 2023. This number represents approximately 147 % of last year’s arrivals in the same period. The majority of tourists, about 69%, came from India, while the remaining 31% were from COTI (Countries Other than India). However, tourist arrivals remain below pre-COVID levels, partly due to global economic uncertainties and the introduction of the new tourism levy act, which tripled the Sustainable Development Fee (SDF) for international tourists. In September 2023, the SDF was reduced by half to attract more high-end tourists.
It was also reported that there is a significant disparity in tourist arrivals across different Dzongkhags in the country. In 2019, the western region saw the arrival of 230,296 tourists followed by central region with 17660 tourists. The eastern and southern regions witnessed the lowest arrival with 7129 and 4578 tourists, respectively. The western region, being the entry point for most international visitors, benefits from more developed facilities, such as Paro International Airport, a relatively better road network, and a concentration of hotels, restaurants, and amenities suited for tourists. In contrast, Dzongkhags in the central and eastern regions face challenges with basic infrastructure, such as poor or incomplete road networks, fewer hotels and restaurants, and limited transport options. The daily SDF also makes longer stays expensive for tourists. With only a few days in the country, most tourists prioritize visits to western region. This further reduces tourist traffic to more remote Dzongkhags, as they lack time to explore these areas.
Going ahead, the committee will conduct further consultation meetings with the Department of Immigration, the Department of Tourism, the Ministry of Industry, Commerce and Employment, and other relevant agencies. Additionally, the committee will conduct field visits to key tourist destinations to gain grassroots understanding of the tourism products. The comprehensive report on the state of tourism in Bhutan will be presented during the 35th session of the National Council.
The Committee concludes that Bhutan’s tourism sector has transformed since 1974, evolving into a sustainable industry that highlights the nation’s cultural and natural environment. The guiding principles of “High Value, Low Volume” and “High Value, Low Impact” have successfully attracted discerning travellers while promoting local well-being in line with the philosophy of Gross National Happiness. Despite this progress, challenges persist, particularly in the uneven distribution of tourism across regions. The concentration of visitors in the western area highlights the need for a comprehensive policy framework that addresses infrastructure and raises awareness in under visited regions, ensuring a more equitable growth model.
Sherab Dorj from Thimphu
