Bhutan, the small landlocked nation wedged between India and China, is possibly absolute best identified for “Gross Nationwide Happiness,” the trade measure that the rustic claims provides a fuller working out of monetary building than GDP.
However the nation needs to be identified for extra than simply religious tourism and Himalayan mountains. Bhutan now hopes to draw overseas funding, foster new industries, and input the worldwide financial system.
It’s a steep hill to climb for the remoted Himalayan nation, which has lately grappled with a brain drain drawback as younger Bhutanese go back and forth in a foreign country for brand spanking new alternatives.
“Geography is a problem for us, demography is a problem for us,” stated Ujjwal Deep Dahal, CEO of Druk Holdings and Investments (DHI), Bhutan’s sovereign wealth fund. Bhutan and DHI want to “learn how to interact with the arena as we transfer,” he added.
But Bhutan and its sovereign wealth fund–tiny by way of international requirements–hope to leverage the rustic’s strengths, together with affordable and common hydropower, which in flip can feed investments in information facilities and Bitcoin mining. Key to the rustic’s plan is the Gelephu Mindfulness Town, a brand new zone to attach Bhutan with companies in South and Southeast Asia.
‘Dimension does now not subject’
Probably the most outstanding sovereign wealth finances—like the ones from Norway, Saudi Arabia or Singapore—are gigantic international traders. Those finances transfer loads of billions of bucks of finances, garnered from pensions, herbal sources or foreign currency reserves, to hunt excessive returns and put money into strategic industries.
DHI is smaller in comparison to those international giants. So much smaller.
Based in past due 2007, DHI has round $3 billion in property below control, and owns stakes in 24 other Bhutanese firms.
By way of comparability, Singapore’s Temasek has $300 billion in property below control, with stakes within the nation’s maximum outstanding firms, like Singapore Airways and DBS.
However Dahal sees alternative in DHI’s small measurement. “Dimension does now not subject,” he stated; as an alternative, DHI can center of attention on “potency and the way we develop.” Nonetheless, he sees Temasek as a task fashion for DHI.
“We have a look at Temasek to a big extent, in relation to governance, in relation to divestments. However having stated that, Bhutan’s financial system and Singapore’s are utterly other,” Dahal stated. “We want to have a look at operating DHI in some way that’s complementary to the demanding situations.”
Bhutan’s happiness and mind drain
Bhutan calculates Gross Nationwide Happiness via a survey of 300 questions administered each and every few years. The most recent GNH index, launched in Might 2023, reported a rating of 0.781 for 2022, upper than the 0.743 reported in 2010.
The rustic’s GDP in step with capita grew from $2,435 to $3,711 over the similar duration—but skilled a steep decline in 2020, the peak of the pandemic.
Pessimism in regards to the financial system has intended that the rustic, with a inhabitants of not up to 800,000, is recently going via a mind drain. Round 13,500 Bhutanese, equivalent to one.6% of the rustic’s complete inhabitants, moved to Australia in 2023. The rustic, which remains to be most commonly lined in woodland, has battled declining source of revenue, a loss of activity alternatives, and emerging adolescence unemployment.
Tourism is one in all Bhutan’s primary assets of source of revenue, however has but to get better from the COVID pandemic. The rustic reported 145,000 vacationer arrivals remaining 12 months, not up to part of the 315,599 arrivals recorded in 2019. The rustic additionally has a combined view of the tourism business, selling a “high-value, minimal impact” tourism fashion to keep away from stressing the rustic’s infrastructure.
Giant bets
DHI manages a number of companies which might be key to the rustic’s financial system, like Bhutan Energy Company, Financial institution of Bhutan, and Bhutan Telecom. And Dahal thinks DHI generally is a platform to carve out a distinct segment for Bhutan in lately’s AI and web financial system.
For instance, Dahal, who has a background in engineering and hydropower, hopes that Bhutan generally is a position the place inexperienced power companies can discover “fascinating applied sciences,” like pump garage and hydrogen energy, and check their business viability.
“We will be able to temporarily check it out in Bhutan, resolve the issue in Bhutan and take it international or regional,” Dahal argued.
He’s in particular eager about hydropower, now Bhutan’s main supply of electrical energy era. Bhutan currently has 2.5 gigawatts of present capability, and an extra 3 gigawatts below building.
DHI’s additionally making some extra unconventional bets. Bhutan is likely one of the international’s greatest sovereign holders of Bitcoin. The rustic began mining the cryptocurrency again in 2019, when it was once value slightly below $10,000. It’s now value round $97,000 as of Might 7, 2025.
Bitcoin mining is typically power extensive, however Dahal claims that Bhutan’s crypto mining, because of its use of hydropower and different inexperienced power, is helping offset carbon emissions in different places.
“Bitcoin is a parallel to virtual gold,” Dahal stated, noting that the rustic’s cryptocurrency technique is a part of a varied means for choice investments.
DHI, as Bhutan’s funding arm, may be supporting the improvement of Gelephu Mindfulness Town, a distinct administrative area that hopes to be an financial hall to South and Southeast Asia. The Town, which spans about 2,500 sq. kilometers, tries to mix financial expansion with sustainability and holistic dwelling, and gives area to companies like healthcare, generation, and inexperienced power.
“We’re looking to carry an innovation technique into DHI to construct startups with international founders, academicians and innovators, and convey them in combination to construct a startup tradition and financial system,” Dahal stated.
This tale was once firstly featured on Fortune.com
