The picturesque realm of Bhutan is taking steps to rejuvenate its tourism sector, which continues to grapple with the aftermath of COVID-19 restrictions. In a bid to boost the industry, the Himalayan kingdom has decided to reduce the daily fee charged to tourists by half, seeking to attract visitors and bolster an economy that heavily relies on this sector.
Notably, Bhutan introduced a “Sustainable Development Fee” of $200 per visitor per night after the conclusion of two years of COVID-related restrictions in September the previous year. This fee hike was explained as an initiative to offset the carbon footprint generated by incoming travelers. However, as the tourism industry struggles to regain its footing, the government has announced a reduction in this fee to $100 per night, effective from September and lasting for a span of four years.
The government underscored the significance of the tourism sector in terms of generating employment, earning foreign exchange, and contributing to overall economic growth. In a statement, officials expressed their hope that this decision would foster positive outcomes for the industry, considering the vital role it plays in Bhutan’s economy.
Historically secluded, Bhutan embraced tourism in 1974, initially welcoming a modest 300 visitors. Over the years, this number burgeoned to 315,600 visitors in 2019, reflecting a 15.1% increase from the previous year, as per official data. The kingdom, however, has maintained a cautious stance toward mass tourism, even prohibiting mountain climbing to preserve the natural sanctity of its peaks. The tourist fee has consequently acted as a gatekeeper, limiting the influx to a smaller number of high-spending tourists, setting it apart from the neighboring nation of Nepal.
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Despite this approach, Bhutan is now striving to enhance the contribution of tourism to its $3 billion economy, aiming to elevate it from about 5% to 20%.
Dorji Dhradhul, the director general of the Department of Tourism, highlighted the potential impact of the fee reduction, particularly during the peak tourist period from September to December. This period encompasses various religious and cultural events in the predominantly Buddhist country.
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Earlier this year, the government relaxed regulations regarding tourists’ length of stay and fees, yet the anticipated surge in visitor numbers did not materialize as expected. Dhradhul revealed that around 56,000 tourists had visited Bhutan since January, but a substantial portion of these visitors—approximately 42,000—were Indian nationals who are subjected to a reduced fee of 1,200 Indian rupees ($14.5) per day.
Tourism plays a significant role in Bhutan’s employment landscape, providing jobs for about 50,000 locals. Before the pandemic, the sector generated an annual foreign exchange income of around $84 million for the country over a three-year period. As Bhutan endeavors to navigate the challenges posed by the pandemic and reignite its tourism industry, the reduction in tourist fees stands as a proactive measure toward achieving these goals.
