Prime Minister Lotay Tshering says Thimpu’s commitment to sustainability justifies the decision to levy a tourism fee, stay out of regional transport pact

Last week, Bhutan’s government took two important decisions which could impact its regional ties, especially with India. The first was to end free entry for regional tourists from India, Bangladesh and Maldives, by levying a daily Sustainable Development Fee (SDF) on them for the first time. Indians make up about 1.8 Lakh of all 2.74 Lakh tourists who visit Bhutan each year. The other decision was to confirm that Bhutan will stay out of the proposed Bangladesh-Bhutan-India-Nepal Motor Vehicles Agreement (BBIN-MVA) that would allow for transit traffic between all four countries. Bhutan joined the meeting of the BBIN, but only as an observer.

In an exclusive interview to The Hindu, Bhutan’s Prime Minister Dr. Lotay Tshering explained the decisions, emphasizing that they had more to do with Bhutan’s capacity than to keep out tourists and traffic.

Does the new fee mean that you want to discourage too many visitors from coming?

Absolutely not. Actually we are trying to encourage tourists. Our policy of “high value, low volume” comes from our leaders, is because we have a limited size and our carrying capacity for visitors is limited, our road surface area is limited, and we have 72% of our land under forest cover. We are trying to enhance that.

With time, we have no doubt that we will have many more tourists from India and regional countries. In the last few years, their numbers have grown from a few thousand to a few hundred thousand each year. In order to provide the value for the money they spend, we needed a better system in place. We also want to redistribute the tourists amongst destinations. Which is why the Sustainable Development Fee (SDF) will not be charged to those travelling to 11 out of the 20 districts in Central and Eastern Bhutan, while we will charge for those travelling to the Western tourist destinations.

Nevertheless, are you worried at all that the decision to levy a fee on Indians, who have always enjoyed free entry to Bhutan, will impact bilateral ties?

The worry is whether we can cater to hundreds of thousands of visitors with our carrying capacity. The bigger worry is about motor vehicle accidents involving regional tourists. In the long run, I think we will only value-add to the good relations between our two neighbours. I don’t think this ₹1,200 is a problem, given the paying capacity of most Indian tourists.

Indian tourists have been accused in the Bhutanese media of littering, disrespecting Bhutanese shrines and not following local traditions. Do you think they need to be sensitized?

These are a few isolated incidents, and our decision to levy a fee is not based on them. With this new fee and our new tourism policy we will be able to offer all visitors from the region a high quality, guided tours, and I am hopeful that such things will not happen.

What about the domestic tourism and hotel industry in Bhutan? Is there a concern that the fee might result in lower numbers of regional tourists, which would impact their business?

Yes, I think that is an important point. We are also under some pressure given the concerns of the industry, but I think these worries will be only transient, and any negative impact will not last. I personally feel, the numbers of tourists will not go down, and even if there were a marginal decrease, it would be made up by the spending capacity of the tourists who pay the fees. The main concern comes not from the high-end hotels, but the budget hotel operators and I will be meeting them to discuss how to upgrade them. We also need to redesign our fiscal policies to tide over any troubles.

Do you think Bhutan will reconsider its decision not to join the Bangladesh-Bhutan-India-Nepal Motor Vehicles Agreement (BBIN-MVA)?

Our decision [to stay out] is for reasons similar to the reasons for our decision on the tourist fee: our infrastructure does not have the capacity to allow all the truck traffic to travel through Bhutan. If our infrastructure improves, our economy improves, trade improves at some point, we would definitely want to be a part of the [BBIN-MVA], but currently given our current infrastructure we cannot even cater properly to our own local needs. As a result, we cannot consider this plan despite its economic potential for Bhutan.

As you know, we are a carbon negative country, and today motor vehicles are the biggest emitters of greenhouse gases. This is the reason we can’t have too many visitors, and we can’t be a part of BBIN-MVA. This is the essence of Gross National Happiness (GNH), not to measure what you have in monetary terms alone.

How do you answer critics who say Bhutan’s policies on transit and tourism are elitist?

It all depends on how you look at it. Our main objective for tourism is not to make money, but to use it as a way to build Bhutan’s brand and have visitors who wish to visit again and again. Our mountains, our forest cover, clean rivers, being a deeply spiritual country, simple and accommodative people…these are all what make us unique. Bhutan may be economically under-developed, but we give our environment the top priority. We take pride in these. People may criticise us for this, but we are committed to our policies to the next generation.