Going beyond agriculture, hydropower and tourism…

Thukten Zangpo

Paro-Bhutan’s economy, traditionally anchored in the hydropower, tourism, and service sectors, is at a crossroads, and to achieve sustainable growth, the country must pivot toward innovation and entrepreneurship.

In an era marked by transformative technological advancements—particularly in artificial intelligence, renewable energy, and digital solutions—the urgency for diversification is palpable. The high rate of youth unemployment and migration of skilled workers highlight the urgent need to diversify the economy and create opportunities for the country’s young population.

By increasing investments in innovation, Bhutan can not only retain its talent but also attract investments, stimulate entrepreneurship, and leapfrog into new industries, such as digital technologies and sustainability-driven enterprises.

With an educated workforce and accessible digital infrastructure, Bhutan is poised to embrace emerging technologies in sectors like agriculture, fashion, renewable energy, and tourism.

At the Bhutan Innovation Forum yesterday, the president of European Capital Coverage, LionTree, Fatine Layt, said that innovation is crucial for job creation but must be sector-specific. The upcoming Gelephu Mindfulness City raises questions about market positioning, product offerings, and competitive advantages, she added.

“One cannot market a tax-free hub and a mindful place. If you need to combine the two, one needs to choose the right equity story,” she said.

Fatine Layt said that in Bhutan, between two mass market oriented countries, India and China, the silver economy is growing fast. However, she added that Bhutan can create a platinum economy ecosystem. “Bhutan can bring precious mindfulness as the ultimate luxury destination creating a tech hub around research, mindfulness, neuroscience, and pharma.”

The founder of Embros Capital, LLC, Alex Fishman, said that Bhutan possesses all the essential ingredients for an entrepreneurial ecosystem. He added that Bhutan has an extraordinary culture and value of mindfulness, which can be a huge asset to entrepreneurs.

“Bringing the best people in the world to Bhutan is another obvious strategy for bringing innovation to Bhutan,” he said.

A professor at the University of Chicago and a member of the Chicago Board of Trade, Pietro Veronesi, highlighted the need for Bhutan to nurture a culture of technological innovation for sustained growth.

He added that innovation has to evolve especially in the private sector and make sure that the public sector provides the required legal support, infrastructure, university, and connect students to entrepreneurs and investors.

He said that Bhutan has the potential to establish a tech hub leveraging its clean energy resources, digital technology, and a burgeoning digital economy.

The chief executive officer of Druk Holding and Investments (DHI), Ujjwall Deep Dahal, said that agriculture, hydropower, and tourism have traditionally been the pillars of Bhutan’s economy.

DHI, he said, is exploring innovation as a new economic pillar. “We must invest in softer areas such as mindset, education, and talent development.”

Ujjwall Deep Dahal said that Bhutan can create a conducive environment for new ventures by promoting collaboration between government, educational institutions, and the private sector.

As part of its innovation strategy, DHI is exploring the creation of a multi-channel fund in collaboration with global partners.

“We have always looked at hydropower development but never largely looked at how we develop our energy resources connecting to developing industries in Bhutan. The country wants to bring energy and demand investors going beyond Bitcoin mining. which consumes lots of energy,” Ujjwall Deep Dahal said.

He added that infrastructure—both in terms of policy and physical resources—along with a conducive mindset, is essential for building a robust innovation ecosystem.