History of Tourism in Bhutan

Bhutan opened its doors to selected package tourists only in September 1974. Unlike many of our neighboring countries, Bhutan regulated tourism. Right from the beginning, it adopted a cautious approach to growth and focused on sustainable development.

Contrary to popular perception, the regulation was not done through quota system but was controlled by the tariff and restricting activities. In 1974, the inclusive tariff was set to US $130 per person per night and only few places were open to tourists.


Bhutan developed its tourism sector on its own will and steam. The process of development was a gradual one and first started in 1970 by the Third King and implemented wisely by our Fourth King.

Towards the end of 1970, the Third King decided to open some restricted areas for tourism. Following the decision, on the 1st December 1971 the Department of Tourism (DoT) was established with a view to organize tourism in the country.

In 1971, during the Third King’s visit to New Delhi, an Indian journalist raised the question about Bhutan’s tourism policy to which the King replied:

“We have not encouraged tourism so far because we have limited facilities for looking after tourists. However, with the construction of hotels and improvement of transport and other facilities, we hope to develop tourism gradually. Once the facilities are there Indian and foreign tourists will be welcomed in Bhutan.”

By 1972, the DoT built the country’s first tourist hotels; a 34-room hotel in Thimphu and 24 room hotel in Phuntsholing. In the same year, during the spring session, the National Assembly vested the Ministry of Foreign Affairs the responsibility of issuing permits to foreign tourists.

A year later, the National Assembly laid down the country first national tourism policy vide No. FO/HQ/131/11215 dated May 8th, 1973. The policy was based on the Lhengyel Shungtsog or the Cabinet’s provisional rules regarding tourists in Bhutan and is the basis of policy of the “High Value-Low Volume.”

When the policy, was drafted Bhutan knew from the neighbor’s experiences the impacts tourists had on the society, environment, culture and the economy. Bhutan tourism policy was drafted to minimize the negative impacts and maximize the benefits,

The policy was a result of a well thought out plan with clear rules and goals.  The two-page provisional rules was concise but a comprehensive one that covered five points from methods of entry to prohibitions of tourists.

For example, “with exception of tourists coming in groups of between six ten persons, individual tourists were not be permitted to enter Bhutan. If the Finance Minister is able to make arrangements for parties of more than ten persons, they shall also be permitted to enter Bhutan.”

The rule required all the tourists to bring hard currency that could be exchanged at the Bank of Bhutan.  According to the rules, tourists were allowed to stay in the country only for a maximum period of 10 days.

Over the years, while some of these rules have evolved, one that is still in force today is the prohibition of photography of images, paintings and frescos of wrathful and protective deities. There is still a restriction of entry into temples devoted to guardian deities and places used by ancient hermits for meditation.

In 1973, the DoT imported its first fleet of foreign luxury cars and mini buses to ferry tourists. In October 1973, India’s Minister of Tourism and Civil Aviation, Mr Karan Singh, came to Bhutan. During his visit, he discussed development of the tourism sector.

Subsequently, in 1974 as preparation for the coronation, the government requested assistance from several countries to develop the tourism sector. Australia was one of the few countries that responded positively by providing some automobiles.

By mid 1974, Bhutan was ready for visitors and had the necessary infrastructure but no experience to deal with guests. The coronation of the Fourth King in June provided the opportunity to gain experience in hosting foreign visitors. Many dignitaries from several countries were invited for the occasion. This was Bhutan debut to the world community. The coronation helped boost the profile of our country and gave the necessary experience.

Three months after the coronation, our Fourth King opened the doors to tourists.  That year 287 tariff paying tourists visited Bhutan overland through India.

Initially, four Dzongkhags or states; Phuntsholing, Samchi, Paro and Thimphu were opened to tourists.  Later Samchi was dropped from the programe as it was found unsuitable.  By 1976, Punakha and Wangdi were added to the list and trekking was opened in Thimphu, Paro and Dagala regions.

The National Tourism Policy had three objectives. The first one was to generate revenue especially foreign exchange. The second objective was for the tourism industry to play an active part in Bhutan’s socio economic development of the country. The third objective was to publicize Bhutan’s culture, religion and people to the world.

Bhutan’s cautious tourism policy was reflected in the 1987 IMF report. It stated that the Bhutan government was cautious in exploiting the potentials of tourism, fearing that uncontrolled tourism growth, would have an adverse effect on the culture. The report also stated that it allowed only tour groups through the public sector and limited tourist’s movement to selected areas of the country.


Back in the days, travelling to Bhutan was not easy. According to an undated but an old government white paper, the three biggest difficulties tourists faced were the getting the transit permit, lack of trained personnel and inadequate hotel facilities.

While the Bhutan Embassy in Delhi and the visa office in Phuntsholing border issued visas for tourists the tourists still had to obtain a transit permit from India to cross the Indian border into Bhutan. According to the government document, “during 1976 we had problems with the transit permits and tourist promotion under such circumstances was very difficult.” As a result, the number of tourists remained at about 1,500 persons for several years.

With the introduction of air services between India and Bhutan in the early 1983, this changed. Interestingly, in the first two years, the number of tourists fell but surprisingly the revenue increased. According to the Tourism Statistics, the revenue in 1984 and 1985 was Nu. 26 million and Nu. 29.8 million respectively.

Two decades after opening the country’s door to tourists, the sector did not yield as much dividend as expected. On 12th April, 1984, in an audience our Fourth King told the visiting delegation from the United Nations, “Tourism: the only reason for introducing it in the country is hard currency. Results are not convincing-may have to reconsider it. Money spent on it is need in transport etc.”

However, this changed. In 1988, Bhutan upgraded its aircraft to a BA 146 and 15 years later in 2003, an Airbus replaced it. By 2006, Drukair was flying to three countries. Since then the number of tourists visiting Bhutan has progressively increased.


Since 1974, Bhutan has actively pursued and has successful implemented the tourism policy of High Value, Low Volume and inclusive tariff system. In 2008, this policy was changed to High Value Low Impact. Bhutan’s unique tourism policy and the tariff system has proved itself to be successful in achieving all the three objectives set by the first National Tourism Policy of 1973. As a result of the farsightedness of our Third King and wisdom of the Fourth King, Bhutan still has a pristine environment and is one of the last living museums in the world and earned a reputation of high end tourist destination.

Contributed by

Tshering Tashi