Bhutan’s economy has been growing rapidly in recent years. Development efforts by the government and rapid modernization have brought about increase in raising the living standard of the Bhutanese people. Today most Bhutanese enjoy the basic amenities such as basic healthcare, education, connected by roads and electricity. The telecommunication services have also reached even the remotest communities with people able to avail mobile services.
Despite the small population, the growth has been very rapid. More than 70% of the population live in rural communities and depend on agriculture and livestock rearing for their income. Therefore the economy is predominantly agriculture driven with people living on subsistence farming growing rice, maize, wheat, buckwheat, millet, barley, potatoes, mustard, chilies and vegetables. The income is also supplemented by selling animal produce like milk, cheese and eggs. These fresh, local and organic produce are sold through farmer’s markets that are common all around the country. Potatoes, apples, oranges, cardamom, ginger and chilies are some of the main cash crops. Although the agriculture produce is not enough for our own consumption, the government has been prioritizing the agricultural sector to make Bhutan self sufficient.
Today the export of hydro-power to India and tourism are two of the highest revenue earners for Bhutan.
Hydroelectricity
One of the major sources of Bhutan’s revenue is from the revenue generated from the hydro-power sector. Bhutan’s fast flowing rivers provides enormous potential to generate hydroelectricity. Major dams were constructed and hydro-power projects were commissioned, preceded by the Chukha Hydro Power Coporation and followed by the Tala Hydro Corporation, the Baso Chhu Hydro Power Corporation and the Kirichu Hydro Power Corporation. The Druk Green Power Corporation oversee these power corporations that generate a combined 1500 MW of power, of which, most are exported to India. Considering the abundant water resources, Bhutan has untapped hydroelectric potential with the capacity to generate another 30,000 MW of electricity. However, it is of the utmost importance for the government to tread slowly in consideration of the impact of hydro-power related construction projects to the surrounding environment.
Cottage Industries
Numerous cottage industries have cropped up over the years, tapping into Bhutan’s rich biodiversity.
One of Bhutan’s abundant resources is the forests through which we have a thriving cane and bamboo handicraft industry. Our talented craftsmen weave intricate designs out of bamboo and cane including hats, backpacks, floor mats, containers and traditional bowls. These items are mainly sold to tourists or Bhutanese people.
Manufacturing
The Manufacturing sector is also booming. It started with the cement factory located in southern Bhutan. Now a thriving industrial sector has also been established in Pasakha with small scale industries such as Calcium and Carbide, and Steel and Ferro silicon. Additionally soft drink (Coca Cola), wood based industries, and food based manufacturing industries have been initiated. Therefore it is without argument that this sector is also a major contributor to the national revenue.
Perhaps this rapid economic development has contributed to making Bhutan, a country in the South Asia region with one of the highest per capita incomes at US$1,321. Despite the potential of even higher rate of economic development, Bhutan continues to adhere to preserving the natural environment. Which mean Bhutan will not aim to develop the country at the cost of our natural environment? Therefore Bhutan’s policies are backed by stringent regulations to help protect Bhutan’s natural environment.