Can Bhutan become like other countries – and should it?

By Anya Schiffrin
June 12, 2012

On our way to Bhutan’s capital earlier this month we drove through a long valley surrounded by tree-covered mountains. This magnificent scene of natural beauty was dotted by the occasional Buddhist chorten. A  river rushed below – spanned here and there by a shaky pedestrian bridge made of planks and wire draped with prayer flags.

After this uplifting drive from the airport, it was a bit of a shock  to see downtown Thimpu surrounded by half-finished four- and five-story buildings. We passed 2 miles of frozen construction sites that resembled Bangkok after the 1997 economic crisis, when parts of that city became a ghost town. In Bhutan’s case the housing bubble has not yet burst, but the demand for raw materials from India has been so enormous that the country now has a temporary rupee shortage and has restricted imports of construction materials.

New York’s Mayor Bloomberg is probably not famous among Bhutan’s citizens, but he might be pleased to know they have some ideas in common:  Bhutan fines people for smoking in public and has banned the importation of cigarettes for resale. The Bhutanese recently added an extra tax on non-essential imports: cars and foreign junk food. As a result, construction seems to have slowed. But the shacks of the Indian laborers who do the building in Bhutan remain, sometimes screened from public view by a green fence. “We are building proper housing for them,” a government official promised.

Many economists, including my husband, are not worried about the rupee shortage, because Bhutan has about 740 million dollars in U.S. dollar reserves – an amount relative to its GDP that puts it in the same league as China, according to International Monetary Fund data from December 2010. Curiously, while Bhutan has been borrowing to buy rupees, paying an outrageous 10 percent interest, it has essentially been lending to the U.S., getting back close to zero return. It can easily sell off some of its dollars to pay back the rupee-denominated loans. Fixing the problem is largely a matter of better liquidity and portfolio management. Hard-currency shortages are common in import-dependent developing countries with overvalued exchange rates and dwindling reserves, but not in a country with large reserves.

Nonetheless, the rupee shortage has worried many Bhutanese, and the press has been warned by the government not to refer to it as a “crisis.” “I need to think of my grandmother in the village,” said one Bhutan Broadcasting Service reporter when describing his reassuring evening news coverage.

The construction boom and migration into the capital come from the success of the government’s development policies. The Royal Government of Bhutan, as it is officially called, provides free healthcare and education, and has dramatically raised life expectancy. So it is producing a healthy, educated generation that doesn’t want to stay down on the farm. Because the country is so mountainous and the villages so remote, life is hard. Growing vegetables and transporting them is difficult, so a lot of produce comes from India. Until a few decades ago there were no roads or cars, and people walked everywhere. Everyone above 40 has a story to tell. We met an official in the town of Punakha who told us that when he got into college in Thimpu, he and his uncle walked 17 days to get there. His uncle rested one night in Thimpu and then walked back home. Another told us of the time his father took him to boarding school in Darjeeling. There was nowhere to stay or eat on the way, so they packed the family horse with supplies and rode a week to get to school.

Even now, some children in remote areas walk up to two or three hours each way to school, and when they get where they’re going, they often find their feet are swollen and their legs covered in leeches. “It’s easiest to let them feed and then they drop off,” a government official told me. As we’ve traveled around the country we’ve seen the Bhutanese walk everywhere. One morning we saw a smiling group of families with small children on their backs walking up the side of a mountain. It was explained to us that a mobile health clinic was visiting and the village headmen had told the parents to bring their children in for medical checkups. When the program first started, families were offered cooking oil or other gifts to encourage them to go. But now they see the importance of medical treatment: Villagers bring a picnic, strap babies on their mothers’ backs, and make a day of it.

Understandably, the younger generation rejects the hardships of the countryside – beautiful though the scenery and simple way of life are. The trouble is that there aren’t enough white-collar and civil-service jobs to go around, so the Bhutanese government is trying to think of ways to make, for example, employment in the construction sector more appealing to unemployed Bhutanese youth. Their plans have not yet succeeded, and there are an estimated 60,000 laborers (mostly Indian) in Bhutan doing backbreaking tasks like moving rocks from the river and chipping away at roads, eventually sending home remittances. As for jobs in other sectors, there aren’t many choices. Tourism, agriculture and construction are the main areas for employment, and the new hydroelectric power plants being built to sell power to India will bring in rupees, but not create many jobs.

There is much discussion about the unemployed young, urban Bhutanese. There are reports of gangs, knife fights and violence in the capital. A country of unity, hierarchy, deference and outdoor traditions such as archery, Bhutan is figuring out what the new world of handheld games, the extremely popular local version of American Idol, Facebook, and celebrity culture means for their society. The older generation decries consumerism, litter, and the lack of discipline among the young and speaks of the values enshrined in the Gross National Happiness framework introduced by His Majesty the 4th king in 1972. The government supports television and filmmaking in the local Dzongkha language. It’s also trying to work out whether it’s ready for detailed right-to-information laws and whether it’s time to start cutting back on advertising in local newspapers. There are now about a dozen papers, and since their circulation is low, they rely on government advertising for survival.

The young people show a respect for authority and a deep interest in the future of their society, but when it comes to GNH, they express their skepticism online as well as in conversation: “There are people who are so poor that they must walk one day to get water. For those people it is a bucket of water that is GNH. For the politicians GNH is air-conditioning and a new house,” a young teacher told me.

The Bhutanese love to tell stories about themselves, and a common theme is their encounters with modernity. Here are a few of my favorites (none are independently verified):

  • To join the United Nations, Bhutan needed to have a population of 1 million; so they put it down on all the forms, and a few officials flew to New York and stayed with friends until they were accepted. Today the current population listed as a more realistic 600,000, but no one is certain, and it’s likely that many of the original U.N. reports that mention Bhutan are incorrect due to their creative accounting.
  • A former newspaper editor says Kuensel newspaper (the country’s oldest) used to print an astrological calendar that listed which days were auspicious and which were not. The religious Bhutanese began canceling their travel plans on inauspicious days, and so Druk Air, the national carrier, called the paper to complain. The same former editor says that the first classified ad Kuensel ever ran was from a yak herder who wanted to swap a yak for an enhanced crossbow.
  • A small-business owner we know describes the electrification of his village. Each month the bill collector came to be paid, and his visit turned into a social event for the village. The businessman’s aunt was so careful about turning on her light that her bill only came to 3 cents a month, causing great merriment among her assembled neighbors.
  • A newspaper editor I met described how the country got its first radio station: After the first gulf war, the central bank of Kuwait was burnt down, and the Kuwaitis had no idea who owed them money. The Bhutanese were the first to stick up their hand and repaid everything they had borrowed. The Emir of Kuwait was so grateful that he sent a BMW to the king of Bhutan. His Majesty thought the gift was too extravagant, so he sold the BMW and used the money to start Bhutan’s first radio station.

These tales, cute as they are, show the Bhutanese are trying to fit together old ways and new customs as they find their place in the world. Influences from India, Tibet, Nepal and even Singapore help shape Bhutan, but the country is trying to see how it can forge a new identity based on some of its old values. It’s a fascinating exercise in consensus building. As an outsider I am rooting for conservation of nature and the traditional style of architecture with its bright, painted buildings. The traditional clothes, soft-spoken courtesy and generosity of the Bhutanese are also treasures to be guarded. But as the Bhutanese tread carefully, how they find their way in our brave new globalized world is ultimately a decision they will have to make on their own.

PHOTOS: A statue of Lord Buddha is pictured at Kuensel Phodrang in Thimphu, May 20, 2012. REUTERS/Singye  Wangchuk Buddha statues are pictured from the Druk Amitabh Mountain monastery, locally known as White Monastery, on the outskirts of Kathmandu, February 11, 2011. REUTERS/Navesh Chitrakar

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Bhutan has indeed developed by leaps and bounds and the fact that bhutanese want their country to become a member of United Nations bears testimony to this fact.Bhutan’s cause has been greatly aided by SAARC wherein several summits have been held to highlight the development and cooperation between the saarc nations.

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