Foreign Direct Investment:
In view of an increasing emphasis placed on the promotion of private sector development as the engine of economic growth, Bhutan’s first FDI policy came into effect in 2005. In a nutshell, Bhutan’s investment regime is being guided by two overarching policy documents, namely, Vision 2020 and the Economic Development Policy 2016. Ever since its inception in 2002, in an effort to adapt to the changing forces of the investment climate and to position itself as an investor-friendly haven, Bhutan’s FDI policy was revisited several rounds, with the last revision undertaken in 2019.
Up till date, Bhutan has been able to receive 83 FDI projects. In terms of the overall FDI distribution, the service sector—comprising hotel, IT and IT-enabled services—dominated Bhutan’s FDI inflows, followed by manufacturing, dairy and agro projects. Moreover, the Asian market constitutes a substantial portion of Bhutan’s FDI inflows (45%). Under the FDI Policy 2019, the government provides foreign investors the maximum equity shareholding of 49% and the minimum project cost of Nu. 5 million in the small-scale production and manufacturing sector. An FDI Division under the Ministry of Economic Affairs was also established in 2019 with a mandate to serve as an investment promotion body and to provide single-window services to investors.
Furthermore, Bhutan is blessed with the following unique selling points which are catalytic in attracting FDI inflows:
- An English speaking workforce
- Low-emission development
- Political stability and transparency
- Subsidised electricity
- A sense of exclusiveness and appeal in its sustainable approach to development, which is guided by the development philosophy of GNH
- Clean air
*FDI Policy 2019:
*Economic Development Policy 2016: