An automobile workshop owner in Olakha, Thimphu, who did not want to be named, has appealed for a fair and sustainable solution to a tenancy dispute that has persisted for nearly 18 years. Operating at the same location since 2008, the owner expressed frustration over rising rents, ambiguous tenancy rules, and the lack of government support for service-based industries, which he believes are not adequately addressed under the current regulatory framework.
The dispute traces back to October 2008, when the government divided the Olakha area into three categories for automobile workshops—small, medium, and large—each assigned a standardized rent. Small workshops were charged Nu 15,000, medium workshops Nu 35,000, and large workshops Nu 60,000. The objective was to streamline rental processes and promote the growth of the automobile industry within the area.
However, over the years, these rates have increased substantially. In 2012, in consultation with the Thimphu Thromde, the property owner raised the rent by nearly 20 percent, citing the need to cover amenities such as rooftop access and other facilities. The workshop owner, however, pointed out that these promised amenities were never provided, and he was instead required to cover the costs of constructing and maintaining improvements himself.
Subsequent rent hikes in 2016 and later have pushed the costs even higher. Today, small and medium workshops pay between Nu 80,000 and Nu 100,000, while large workshops are charged over Nu 100,000. The escalating rent has forced several automobile operators to relocate; more than seven workshops have already moved to other areas. The owner emphasized that the current tenancy regulations fail to meet the needs of service industries. “The tenancy rules are not designed for businesses like ours,” he said. “We would greatly appreciate if the government could provide state land so we can operate sustainably without constant uncertainty.”
Another major concern raised is the responsibility for maintenance. According to the owner, all repairs, upkeep, and infrastructure improvements are borne by the automobile operators themselves, while building owners assume little or no responsibility. “Look at the road conditions around Olakha workshop area,” the owner said. “Poor infrastructure directly affects our operations and is partly due to the lack of accountability on the part of property owners.”
Under Bhutan’s Tenancy Act, the regulation of lease agreements and rental rates is meant to provide balance between property owners and tenants, ensuring fair rents, security of tenure, and clarity of obligations for both parties. Yet, in the case of service-oriented businesses like automobile workshops, the law does not always address sector-specific challenges, such as heavy usage of premises, infrastructure needs, or specialized operational requirements.
Officials from the Land Commission noted that efforts are being made to provide equitable solutions. “We have approved nearly 90 percent of applications for land leases, provided they align with the local area plan,” said a Commission official. The process requires a letter of intent from the Ministry of Infrastructure and Transport, which oversees land use planning and ensures that all lease agreements are consistent with sustainable development objectives.
The official clarified that all leases must comply with the local area plan, which is designed to balance economic development with community needs and environmental sustainability. However, applicants must meet the requirements outlined in the plan, including zoning, land-use restrictions, and infrastructure considerations.
Looking ahead, government development plans under the 13th Five-Year Plan include broader urban management initiatives, such as potential mergers of Thimphu and surrounding areas, which could affect land allocation and business operations. For entrepreneurs seeking land leases, the process involves approaching the Bhutan Chamber of Commerce and Industry (BCCI) for initial guidance and support.
The automobile workshop owner hopes the government will consider a more equitable approach to tenancy and land allocation. “We have invested heavily in our workshops, yet we face high rents, poor infrastructure, and a tenancy system that does not reflect our needs,” he said. “We seek policies that support business growth, ensure fair rental practices, and allow us to operate without the constant fear of losing our place or facing unreasonable costs.”
Entrepreneurs like him stress that fair tenancy rules, proper land allocation, and shared responsibility for maintenance are critical not only for sustaining individual businesses but also for the broader local economy. By creating a regulatory framework that accommodates the specific needs of service-based industries, the government can ensure that Thimphu’s commercial sectors thrive while balancing the interests of property owners and tenants alike.
As the city continues to develop, stakeholders are hopeful that lessons from disputes like the Olakha case will inform more inclusive policies—ensuring that small and medium enterprises, which form the backbone of Thimphu’s economy, receive the stability and support they need to grow and prosper.
Sherab Dorji
From Thimphu
