Thukten Zangpo
Despite plans to lift the vehicle import moratorium on August 18, Prime Minister Tshering Tobgay announced the need for further study to assess its impact on Bhutan’s road infrastructure and traffic congestion.
Speaking at the Meet-the-Press session on July 26, the Prime Minister stated that while the Ministry of Infrastructure and Transport (MoIT) had conducted an initial study on Thimphu’s vehicle capacity and submitted findings to the Cabinet, a more comprehensive evaluation is necessary.
The Prime Minister said that a comprehensive evaluation was necessary that could consider the factors such as road capacity, traffic congestion, and efficiency of public transportation.
Lyonchhen expressed concerns about the potential consequences of lifting the ban without proper planning, highlighting the rapid increase in vehicles, particularly in Thimphu Thromde, and the subsequent strain on the city’s infrastructure.

Number of vehicles as of June this year
He also mentioned that while there are no plans to restrict Thimphu residents from buying vehicles, a thorough study is essential before lifting the moratorium.
The Prime Minister said that Thimphu Thromde alone has over 60,000 vehicles out of 127,000 in total, leading to traffic congestion, particularly during peak hours, and causing inconvenience to commuters and affecting service delivery. He added that Bhutan’s current vehicle-to-population ratio of approximately one car for every five person could potentially worsen to one car for every two person if the moratorium is lifted without proper planning.
Lyonchhen shared that this evaluation is crucial because once the vehicle moratorium is lifted, a surge in vehicle purchases could lead to severe traffic congestion and associated problems, which would be costly and inconvenient for residents, especially in Thimphu Thromde.
The MoIT, the Royal Bhutan Police’s Traffic Division, and Thimphu Thromde are collaborating to find ways to manage and ensure smooth traffic flow and avoid complications during emergencies in the area.
The moratorium on import of select vehicles was initially imposed in August 2022 to address unsustainable transport loan levels and declining foreign currency reserves.
As of February, this year, transport loans stood at Nu 7.68 billion.
With the import ban on vehicles, Bhutan could have saved Nu 5.3 billion in foreign reserves every year.
Last year, Bhutan imported vehicles worth Nu 926.09 million, compared to Nu 3.2 billion in 2022. This marked a significant drop by 71 percent in vehicle imports.
The total vehicle import was even more substantial in 2021, reaching a staggering Nu 4.72 billion. This import figures are for various types of vehicles, such as passenger cars, vehicles for transporting 10 or more people, goods vehicles, and electric cars, excluding motorcycles.
According to the central bank’s monthly report, the country’s total external reserve stood at USD 596.85 million as of May this year, compared to USD 549.08 as of May last year.