Bhutan remains a unique and special country, but for better or worse, it has opened its doors and hearts to the outside world and joined the global community. There is now almost one mobile phone for every Bhutanese and there are more than 75,000 registered vehicles (though there are still no traffic lights). The challenge ahead for the government is to bring the benefits of globalisation and capitalism to Bhutan without undermining the very things that Bhutanese cherish about their unique culture.

Democracy & Parliament

Bhutan's parliament consists of the king (Druk Gyalpo), the National Council (upper house) and the National Assembly. The National Council consists of 25 members, 20 of whom each represent one of the dzongkhags (political districts) and there are five additional members nominated by the king. Interestingly, candidates for the National Council must not be members of a political party.

For the first (2008) and second (2013) elections, the National Assembly had 47 seats across the 20 dzongkhags. The constitution allows for adjustments to be made to the National Assembly as the population increases (to a maximum of 55 seats), and as the distribution of voters across dzongkhags changes.

Modernisation & Gross National Happiness

Despite the rapid uptake of technology, democracy and global trends, Bhutan is very aware of the dangers of modernisation and the government continues to assume a protective role in Bhutanese society. Bhutan was the first country to ban not only smoking in public places but also the sale of tobacco. Also banned are Western-style advertising billboards and plastic bags.

Issues of sustainable development, education and health care, and environmental and cultural preservation are therefore at the forefront of policy making; as are the tenets of Buddhism, which form the base of Bhutan's legal code. Every development project is scrutinised for its impact on the local population, religious faith and the environment. Bhutan's strict adherence to high-value, low-impact tourism is a perfect example of this. Bhutan is one of the few places on Earth where compassion is favoured over capitalism and wellbeing is measured alongside productivity. This unique approach is summed up in the much-celebrated concept of Gross National Happiness. However, even this much lauded approach has lost some of its gloss in recent years as Bhutan responds to its citizens' demands.

Challenges & Changes

Bhutan is a tiny nation with abundant natural riches and a small, sustainable population surrounded by much larger countries with massive populations and economies. This situation has presented opportunities (the export of hydroelectricity to India provides around 50% of government revenue), but also threats in recent decades.

A rapidly growing economy and increased consumerism have led to soaring imports, primarily from India. The flow of Indian rupees (to which the Bhutanese ngultrum is pegged) out of the country resulted in a cash crisis in 2012. Many Bhutanese say they have simply caught the global bug of overspending and overborrowing. The irony of this happening in the country that introduced Gross National Happiness is not lost on the Bhutanese and is openly discussed. In the last decade, the road network has increased by over 600% and this is married to a proportional surge in car ownership. Increased mobility and aspiration has led to unprecedented migration from rural villages to urban centres where there is chronic youth unemployment. But what teenager wants to be a yak herder if it means being out of mobile phone range?

At the 2015 Climate Summit in Paris, Bhutan did not pledge to be carbon neutral; it pledged to remain carbon negative. The tiny, well-forested nation absorbs three times the carbon its economy produces. To further its green credentials, Bhutan is aiming to cut its fossil fuel dependency on India by moving to electric cars, banning export logging and achieving 100% organic food production. Hydro power is seen as the holy grail, and although it is certainly not an entirely clean or entirely green energy source, its importance to Bhutan cannot be overstated. The future earnings from the hydro-power projects in construction are already earmarked for Bhutan's burgeoning foreign debt. An ambitious plan for 10,000 MW (megawatts) by 2020 has had a reality check through project delays and limited construction funds from India. The most likely scenario is about 3500 MW by 2020. Currently Bhutan has five operating schemes generating 1582 MW, six schemes under construction (4228 MW) and five proposed projects (8170 MW).