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Rajesh Rai | Phuentsholing

As the time to reopen the border gate nears, hoteliers in Phuentsholing are worried that the Sustainable Development Fee (SDF) for the regional tourists could affect their business.

As per the government’s announcement, SDF of Nu 1,200 will be levied on regional tourists. If this is applicable in Phuentsholing, hoteliers say they will lose edge over hotels across the border.

A hotel manager, Namgay Wangchuk, said that if SDF is applied to regional tourists right after entering Phuentsholing, there are high chances that tourists will stay across the border for the night to save SDF.

“They will enter Phuentsholing only the next day, process their permit and head to their destinations,” he said.

Hoteliers so are requesting the government to apply the SDF after crossing Rinchending check-post. This will encourage regional tourists to spend overnight in Phuentsholing for comfort and convenience of processing the documentation the next day.

The general manager of Druk Hotel, Thukten, said even dollar-paying tourists were exempted from paying USD of Nu 65 when they stayed the night at Phuentsholing—before the pandemic.



The hoteliers have appealed to the government.

The Hotel and Restaurant Association of Bhutan’s (HRAB) representative in Phuentsholing, Karma, said there is a growing tension among the hoteliers.

“It takes about two days for documentation. Now, if this SDF is applicable right after entering Phuentsholing, regional tourists will stay across the border until the documentation processes are completed,” he said. “This is going to affect Phuentsholing hotels.”

Karma said the government would also lose in taxes.

He also said that the government is yet to decide on the budget hotels.

“Budget hotels are not allowed to entertain tourists. Many budget hotel owners have invested in upgrading their hotels to tourist standards hotels.”

Government’s notice, which said only star hotels are allowed to entertain tourists, was “sudden” Karma said, adding this would hit the hotels badly.



Karma also said that the government must look into the service side of the sector.

“We have to capitalise on the human resources, which is very limited in the country today.”

Budget hoteliers pointed out that it is the tourists’ decision where they want to stay.

A budget hotel owner, Pema, said if all hotels are tourist-standard there would be no hotels for locals.

“If all the hotels are upgraded to tourist hotels, it is going to be expensive for the locals,” he said.

“If regional tourists have to pay SDF for staying in Phuentsholing, we will have much to lose than gain.”

A restaurant owner, Karma Tshering Dorji, said he is yet to get skilled restaurant employees.

“I want to import foreign workers to work in my restaurant, but I didn’t get the permission to do so,” he said. “But interestingly, other restaurants, ones that fall under the same category were allowed. There are two rules.”



There are at least 50 hotels in Phuentsholing, including over 12 three-star hotels. Most are budget hotels. Sources said that investments on hotels and tourism-related businesses have increased across the border.

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