Tourism in Bhutan
The tourism industry has become a major service industry generating foreign exchange and creating employment opportunities. There are important spin-off benefits in the form of small scale enterprises, income for rural families, and employment for the hundreds of young job seekers. Tourism has positively strengthened Bhutan image in the world as a small country with big ambitions for its environment and culture. In some ways, it has also provided the incentives to promote some of Bhutan’s local cultures that are unique to small remote settlements.
Tourism was initiated in 1974, and was operated by the government. Gradually, there was a trend towards greater private sector involvement as the tourism sector was first corporatized in 1983, and then privatized in 1991. To facilitate and regulate the sector, the Tourism Authority of Bhutan was established, which was later restructured to form the Department of Tourism under the Ministry of Economic Affairs. In 2008, this body was granted autonomy and became the Tourism Council of Bhutan.
Since the start, tourist arrivals and their contribution to the country GDP has increased. In 1985, there were 1,896 arrivals contributing 1.67 million US$ to the exchequer. This number has risen dramatically to 21,094 in 2007, contributing 29 million US$. By 2017, it is envisaged that revenues generated from this sector would contribute about a quarter to the GDP.
While recognizing the enormous benefits offered by tourism, Bhutan is aware of the potentially damaging effects of it as well. Therefore, the policy of the country has been geared towards promoting sustainable tourism. So far, the number of tourists to the country have been regulated partly by the minimum daily tariff (US$ 200 for the high season and US$ 165 for the low season), and partly by the lack of tourism infrastructure. The tourism sector is gradually taking an approach that seeks to strengthen itself as an industry, increase the range and quality of products, and spread the benefits to rural communities while maintaining the balance it has so far achieved in terms of environmental and cultural conservation. Examples include (effective from 1st July 2011) promoting Bhutan as a year round destination and not be limited by challenges of seasonal periods of tourism, encouraging family trips and waiving off royalty for children below 12, and improving services through mandatory disclosure of tour packages that would include information on types of accommodation, levels of services, and meal plans. The tariff will be revised to US$ 250 effective from 1st January 2012.