The Kingdom of Bhutan

The Kingdom of Bhutan

Updated September 6, 2023
The Kingdom of Bhutan
Background
The Wangchuck dynasty, in power since 1907, has shaped
The Kingdom of Bhutan is a small, landlocked Himalayan
Bhutan’s democracy. Bhutan’s path to democracy was not
country situated between India and the People’s Republic of
spurred by a popular movement but rather was spearheaded
China (PRC, or China). The mountainous kingdom is about
by the monarchy. After previous monarchs implemented
half the size of Indiana, with an estimated population of
incremental social and administrative reforms, current King
approximately 876,000. Hydropower (accounting for 63%
Jigme Khesar Namgyel, in power since 2006, began the
of the country’s exports by value), agriculture, and forestry
country’s top-down democratic transition. In 2008,
development are the primary drivers of economic growth.
Bhutan’s political system changed from an absolute
With 60% forest cover and extensive hydropower, Bhutan
monarchy to a constitutional monarchy with a
is a carbon-negative country. Although Bhutan does not
parliamentary government. Bhutan’s first prime minister,
have diplomatic relations with any permanent members of
Jigme Y. Thinley, came to power in the country’s first
the U.N. Security Council, including the United States, the
elections in 2008. The 2008 elections were deemed free and
U.S. State Department describes U.S.-Bhutan relations as
fair by international election observers. Parliamentary
“warm” and “informal.” The U.S. Embassy in New Delhi,
elections were also held in 2013 and 2018. In 2018, the
India, conducts consular responsibilities for Bhutan, and
center-left Druk Nyamrup Tshogpa Party won 30 of 47
Bhutan maintains a consulate general in New York City.
seats. The next election is due in October 2023.
Geopolitical tensions between China and India along their
Himalayan border have generally increased U.S.
Figure 1. Bhutan in Brief
policymakers’ interest in the region. Members of the 118th
Congress have focused interest on Bhutan’s human rights
record and Chinese territorial claims in Bhutan.
The Biden Administration has identified its primary
strategic objective in Bhutan as “the eventual normalization
of relations while reinforcing support for Bhutanese
sovereignty.” The State Department describes Bhutan as
playing an active role in supporting the rules-based
international order, particularly in the Indo-Pacific, despite
being one of the world’s newest democracies. The
Bhutanese government has consistently said that it seeks to
expand U.S.-Bhutan cooperation. Bhutan has participated in
a U.S. Agency for International Development regional
program for South Asia directed at developing power
infrastructure, and has implemented energy- and disaster-
related programs intended to help mitigate some of the

effects of climate change.
Source: CIA World Factbook, World Bank.
The Constitution, Elections, and the King Ethnic, Religious, and Refugee Issues
Bhutan’s constitution, implemented in 2008, established
Bhutan has four ethnic groups, most of which are associated
three branches of government: legislative, executive, and
with a region in the country: the Ngalops (westerners), the
judicial. The bicameral legislature includes the National
Sharchop (easterners), aboriginal people, and the
Assembly, with 47 elected representatives, and the National
Lhotshampa (southerners). The Ngalops migrated from
Council, with 25 members, 5 of whom are selected by the
Tibet to Bhutan around the ninth century. They introduced
king. Legislators serve five-year terms. The executive
Tibetan culture and Mahayana Buddhism to Bhutan. The
branch includes the monarch, currently King Jigme Khesar
Ngalops are the majority in central, western, and northern
Namgyel Wangchuck, as Head of State, and the prime
Bhutan, and are culturally, religiously, and politically the
minister, presently Lotay Tshering, as Head of Government.
country’s most prominent group. The Sharchops are
The monarchy is hereditary, and the king appoints the
thought to have originated from Assam, in present-day
majority leader in the parliament as prime minister. The
India, or perhaps Burma, and they also practice Mahayana
king can be forced to abdicate by a two-thirds vote in the
Buddhism. Several aboriginal groups (Drokpa, Lepcha,
National Assembly. There is also a Council of Ministers,
Doya) live and practice Hinduism throughout Bhutan.
whose members are nominated by the king, in consultation
Lhotshampa, Hindus of Nepali descent, are the majority in
with the prime minister, and approved by the National
the south.
Assembly. The judiciary consists of the Supreme Court, the
High Court, District Courts, and Sub-District Courts.
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The Kingdom of Bhutan
In the late 1980s and early 1990s, the Thimphu government
2004. Bhutan is also a member of the Bay of Bengal
implemented policies targeting the Lhotshampa, who then
Initiative for Multi-sectoral Technical and Economic
comprised about 25% of Bhutan’s population (35% today),
Cooperation. Bhutan has full representation at the United
calling them a threat to the country’s cultural identity.
Nations, which it joined in 1971. Bhutan also joined 174
Many Lhotshampa were expelled or voluntarily emigrated
other countries in signing the Paris Agreement on Climate
to India and Nepal, evading government attempts to
Change in 2016.
forcibly integrate them into mainstream Bhutanese culture.
This tension led to unrest in the south of Bhutan, and
Doklam and Sakteng Border Disputes
resulted in an estimated 107,000 Hindu Nepali settlers
With a population under 1 million, Bhutan is dwarfed by
returning to Nepal as refugees. The United States resettled
India and China (each 1.4 billion), and since the 1962
some of the Lhotshampa refugees residing in Nepal. H.Res.
China-India border war, the two powers’ periodic tensions
228 and S.Res. 108, introduced in the 118th Congress,
have complicated Bhutan’s external relations. China-India
would recognize the Bhutanese government’s responsibility
border tensions escalated in mid-2017, when China
for the oppression and forced eviction of over 100,000
extended an unpaved road near Doklam, on the disputed
Lhotshampa in the 1980s and 1990s.
border between China and Bhutan, high in the Himalayas.
Indian military personnel subsequently moved to the border
Economic Development and “Gross
area, and a standoff ensued until a de-escalation of tensions
National Happiness (GNH)”
two months later. Doklam is located in Bhutan-China-
Bhutan is a lower-middle income country, and has
disputed territory north of the strategically vital Siliguri
experienced consistent economic growth since 2021, with
Corridor, which is 20 miles wide at its narrowest and links
GDP growth exceeding 4%. The Asian Development Bank
central India to its northeastern region. PRC control of the
forecasts growth to reach 4.6% in 2023 and 4.2% in 2024.
corridor could isolate 45 million Indians in an area the size
The poverty rate decreased from 36% in 2000 to 12.4% in
of the United Kingdom. In 2020, China made a new claim
2022. New hydropower plants are expected to come online
to the Sakteng Wildlife Sanctuary (285 sq. mi.) in Bhutan’s
while the government has invested past hydropower profits
east; the sanctuary had not previously been considered
in public health care, contributing to an increase in life
disputed. Previous border talks between Bhutan and China
expectancy.
have focused on disputed areas along Bhutan’s northern and
western borders with China. The 118th Congress introduced
The State Department identifies “expanded assistance in the
S.Res. 75, condemning PRC “provocations” in South Asia,
areas of monetary and policy, technology, entrepreneurship,
and in part highlighting PRC expansion in Bhutanese
intellectual property (IP) and support for U.S. investment”
territory.
as ways the United States can help maintain Bhutan’s
economic trajectory.
Some observers claim that China has established new
settlements on Bhutan’s territory, and view China’s
The government of Bhutan emphasizes the concept of
encroachments as pressuring Bhutan to yield territory in
measuring Gross National Happiness (GNH), in contrast to
Bhutan’s west. These alleged, territorial infringements offer
Gross Domestic Product (GDP). GNH was enshrined in
Beijing greater leverage in the case of a China-India
Article 9 of the Constitution of Bhutan in 2008. The Gross
conflict. Bhutan shares its eastern border with India’s
National Happiness Commission (GNHC) is responsible for
Arunachal Pradesh (AP) state, which China claims as
implementing GNH and ensuring that all government
“southern Tibet.” The United States recognizes the AP-
policies are formulated and implemented in line with the
China demarcation as an international border. In October
principles of GNH. The World Bank’s most recent estimate
2021, Bhutan and China signed an agreement on a “three-
of Bhutan’s Gini index in 2017 was 37.4, a decrease in
step roadmap” to help expedite talks on boundary disputes.
inequality from 2012’s 38.8 index.
King Jigme Khesar Namgyel officially visited PM Modi in
April 2023, when Modi confirmed India’s commitment to
Foreign Relations
resolve border tensions trilaterally.
Bhutan’s external relations have been heavily influenced by
the United Kingdom, and more recently India, for much of
Other Security Concerns
the past century. The 1910 Treaty of Punakha and 1949
Bhutan has experienced other security challenges. In the
Treaty of Friendship allowed the British and Indian
1990s, Indian separatist militants (the United Liberation
governments, respectively, to direct Bhutan’s external
Front of Assam (ULFA) and others) established bases in
affairs. Both treaties prohibited British and Indian
southern Bhutan. After five rounds of talks with the
“interference in the internal administration of Bhutan” and
militants failed, the National Assembly approved
provided protection from external encroachment. India is
“Operation All Clear” in 2003 to remove the groups
Bhutan’s key strategic and economic partner. Bhutan and
forcefully. The operation captured or killed 650 militants,
India reaffirmed their relations with another Treaty of
including top ULFA leaders. Other security threats emerged
Friendship, signed in 2007, emphasizing that Bhutan-India
prior to the 2008 election, as several bombs exploded in
disputes regarding the Treaty shall be settled through
Thimphu and other districts. The United Revolutionary
bilateral negotiations. Bhutan has joined a number of
Front of Bhutan claimed responsibility for the bombings to
international organizations and entered into several
highlight the rights of Lhotshampa.
international agreements. It was a co-founding member of
the South Asian Association for Regional Cooperation in
Joseph O. Yinusa, Research Assistant
1985 and joined the South Asian Free Trade Agreement in
Maria A. Blackwood, Analyst in Asian Policy
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The Kingdom of Bhutan

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