The private sector, long recognised as the engine of economic growth, continues to struggle under the weight of bureaucratic inefficiencies, inconsistent regulations, and limited access to finance. A recent review of the country’s business regulatory landscape, spearheaded by the Ministry of Industry, Commerce, and Employment in collaboration with other stakeholders, has painted a stark picture of the challenges hindering private sector development.

The findings are a wake-up call for the government. Among the 235 issues identified, 31 relate to cumbersome licensing and permit regulations, 37 to excessive tax policies and financial charges, and 27 to poor service delivery standards by regulators. Equally concerning are barriers tied to quality management systems and limited access to finance, the very lifeblood of entrepreneurial activity. The reading is clear: the private sector is being stifled, and decisive action is urgently needed.

Private sector development is a necessity, not a luxury. A vibrant and dynamic private sector generates jobs, diversifies the economy, drives innovation, and reduces dependence on public resources. For Bhutan, where unemployment among youth is a pressing concern and economic diversification remains a distant goal, a thriving private sector could be the answer to many of its developmental challenges. This potential, however, will remain unrealised unless systemic barriers are dismantled.

The review offers a roadmap for transformation. First, it emphasises the need for inclusive policymaking through public consultations and regulatory impact assessments. This is a step in the right direction, as regulations crafted without the voices of businesses often end up counterproductive. Policymakers must ensure that businesses, especially small and medium enterprises, are not burdened by unnecessary red tape or unpredictable policies.

Second, improving access to finance must be a national priority. Entrepreneurs cannot thrive if capital remains out of reach. Financial institutions, in collaboration with the government, should explore innovative solutions such as microfinance schemes, credit guarantees, and low-interest loans tailored to small businesses.

We must also expand market opportunities and address trade barriers. Bhutanese businesses need access to larger markets—both domestic and international—to achieve economies of scale and sustainable growth. Enhancing regional trade partnerships, improving logistics, and supporting e-commerce could unlock new opportunities.

Skill development initiatives are another critical area we can invest heavily on. The private sector requires a workforce equipped with skills aligned to market demands. Strengthening technical and vocational education programmes and fostering industry-academia collaborations can bridge this gap. More needs to be done in this department.

And, equally important is ensuring consistent enforcement of regulations. A fair and predictable business environment is essential to inspire confidence among investors. Streamlining bureaucratic processes, enhancing transparency, and holding regulators accountable will go a long way in rebuilding trust between the government and the private sector.

The review presents an opportunity for us to recalibrate its approach to private sector development. It is not enough to recognise the private sector as the engine of growth; we must fuel this engine with enabling policies, robust infrastructure, and unwavering political will.

We cannot afford to let its private sector remain shackled. Breaking these chains will not only unleash entrepreneurial potential but will also drive the nation closer to its vision of a sustainable and self-reliant economy.

The choice is simple: reform or risk stagnation.