Bhutan: Bhutan Tourism Profile

Travel and tourism grows due to strong increase in arrivals in 2013

Arrivals into Bhutan showed strong increase in 2013. Indian tourists remained the key international arrivals, thanks to the number of schedule and charter flights, inclunding a good land transportation service, which is frequently used by Indian tourists visiting the country. Non-Indian arrivals in 2013 were driven by Asian nations like Japan and China whilst European tourists from the UK, Germany and France are as well significant.

Local operators dominate travel and tourism

Travel and tourism in Bhutan is still occupied by local companies as they are additional familiar with the country than foreign companies. Bhutan government has been trying to encourage foreign investment in Bhutan, focusing on attracting foreign investors to open high-end or luxury-style businesses, such as 5-star hotels. The key player in the transportation is the national airline such as Druk Air.

Online sales show good increase but remain small

Online services have been introduced in various categories, such as car rental, hotels, travel retail and air transportation. Online sales showed healthy increase rates in each category in 2012 in current price terms, but continued to account for small shares of in general sales. The government and Tourism Council of Bhutan have attempted to promote online services in order to boost their popularity as the internet is seen as a key way of encouraging international tourists to actually visit Bhutan.

Paro remains the only international airport, whereas Druk Air opens new routes

Paro is the only international airport in Bhutan and it remains to be the key entrance particularly for non-regional tourists meaning those who do not enter Bhutan from India, Bangladesh and Maldives. Buddha Air ceased operations in 2011 due to heavy losses, making Druk Air as the remaining schedule airline. Druk Air introduced new routes from Singapore and Mumbai in September 2012 in order to attract additional Asian and European visitors to Bhutan. These new routes are the extension of Bangladesh, India, Nepal and Thailand routes that Druk Air operated before.

Bhutan is expected to welcome additional arrivals and grow its travel and tourism industry in a sustainable way

The Tourism Council of Bhutan and the government aim to continue to make all non-regional tourists pay a minimum daily charge of US$250 or US$200 per day depending on time period of year for their visits over the estimate period. This is likely to result in only better-off tourists who can afford to pay the charges visiting Bhutan. The country is keen to welcome additional international tourists someday, but it wants to develop a travel and tourism industry that will protect both the environment and the country’s natural resources. Air transportation will continue to be dominated by Druk Air. Car rental will continue to be run by local operators, and local and traditional hotels will continue to be promoted.

Daily fee hike for foreigners deferred to 1 January 2012

Bhutan raised the daily fee for non-Indian visitors to US$250 per day from 2012, having deferred it from 2008. This was part of its continued attempt to control the influx of visitors to the landlocked Himalayan kingdom. However, the year it was approaching into result, the recession struck and negatively impacted Bhutan’s premium travel trade. As a result, the fee hike from US$200 to US$250 per day was deferred to 1 January 2012. This increased fee, however, will allow better access to tourist locations as no additional entrance fees will be charged. In an effort to raise the standards of accommodation in line with the higher fee, tour operators will need to provide at least three-star level accommodation from 2012.

Plans to open up heritage accommodation to tourists underway in 2010

During 2010, the Tourism Council of Bhutan put out a request for proposals from people within the eastern part of the country who wanted to convert their homes into heritage accommodation, potentially opening up a new travel accommodation niche. Similar requests were floated for eco-lodges and luxury tents across the country.

Buddha Air starts flights to Bhutan - second airline to fly to the country

During 2010, the Tourism Council of Bhutan put out a request for proposals from people within the eastern part of the country who wanted to convert their homes into heritage accommodation, potentially opening up a new travel accommodation niche. Similar requests were floated for eco-lodges and luxury tents across the country.

Nepalese-based airline Buddha Air started its initial flights to Paro, the national airport, in August 2010, offering flights a week. There are plans to increase flight frequency to Paro if merited. Buddha Air started up in 2010 with Beech 1900D and three ATR aircraft.

Royalty-free zones listed in May 2010 make transit easier

Three entry locations to Bhutan were listed as royalty free in May 2010, whereby tour operators need not pay the per day fee per visitor as long as they are in transit in or out of Bhutan and not staying additional than night. To encourage family trips, the government as well waived a royalty fee of US$10 per child for each child below 12 years.

Arrivals from Europe expected to increase

The source markets of France, Germany and Italy are expected to be the mainstay of tourist arrivals into Bhutan over the estimate period, with visitors from France, in particular, growing at a CAGR of 23%, building upon a small base as Bhutan steps up its tourist campaigns across the world. India is still expected to contribute the bulk of tourists, but growing at a much additional modest pace of a CAGR of 5% over the estimate period.

Coronation of new king helps to boost tourism sector

Daily tariff rises to US$250

International hotel chains enter Bhutan

Independent travel prohibited

Priced Out Of The Market