Contemporary Economic Issue (EE613 ) Term Paper presentation 24 Nov to 2nd Dec. 2015 Topic: Prospects and Problems of Tourism Industry in Bhutan By: Bal Bahadur Kkarka

Overview of Presentation Brief insight on Bhutan. Tourism policy. Overview of the topic. Introduction . Objectives of the study. Methodology . Literature review. Prospects of tourism industry in Bhutan. Problem to rise tourism industry in Bhutan. Suggestion to improve the scenario. Conclusion . References.

Bhutan: Brief Insight on Bhutan

Population: little more than 700,000 Size: about 38,394 sq.km Geography: Mostly Mountainous landscape (ranging 100 – 7,500 meters) Forest cover: 72% (constitutional mandate 60% for all time) Modern Economic Plans: began from 1961 (currently 11th FYP) Government: Democratic Constitutional Monarchy –shift from monarchy in 2008. Major Sources of foreign revenue – Hydro Power & Tourism

Tourism policy Responsible Tourism Quality High value, low impact Unique character Authenticity

Overview Tourism operations began only in 1974 Fully operated by government with 287 arrivals. • Opened to private operations in 1991 33 operators licensed – arrivals 5000 plus. Tourism licenses freed in 1999 more than 1000 Tour operators currently – annual arrivals more than 100,000 (only 318 local tour operators) • Main Tourism Products Culture, Nature based and wellness. Tourist tariff Peak season:$250/day & Lean season: $200/day

Source: Tourism Council of Bhutan

Earnings from Tourism in the Past Few Years (USD in Million) Source: Tourism Council of Bhutan

2015 Employment: little more than 5000 individuals 44,424 42714 87138 2015 Employment: little more than 5000 individuals Highly taxed industry in the world. Lack security and tourism facilities seasonality of tourist arrival unequal distribution and spread of income and benefits informal tourism.

Tourist arrival by Dzongkhag

Preferred Time to Visit

Introduction Tourism is defined by the world tourism organization (NSCB, 2004), as the act travelling for the purpose of recreation and the provision of services for this act, Renders service to the tourists and all other tourism related business. Promotion and Advertising tourist famous spots and destinations. Providing effective travel facilities. Accumulate foreign exchange Have both positive and negative impacts.

Sustainable socio-economic development, promotion and preservation of tradition and culture, and conservation and protection of natural environment are at the center of government policy Today tourism in Bhutan is a vibrant business with a high potential for growth and further development. Bhutan also enjoys the reputation for authenticity, remoteness and well protected culture and beauty of the natural forest.

Objectives of the study

Methodology This paper is an explanatory study in analyzing the potentiality of tourism in response to the problems faced and prospects of tourism industry in Bhutan. The present study is based on secondary data. The secondary data was collected by various published sources like Books, Journal, Magazine, Reports, News papers, Publications, etc. The findings were discussed in the light of published literature.

Literature Review According to the WTO Tourism Economic Report (1998), Tourism is seen as one of the most promising areas of growth for the world economy and most importantly to country’s economy. Tourism industry nourishes a country’s economy(British Journal of Humanities and Social Sciences, 2012). (Milanović &Stamenković,2012) suggested that tourism in modern business environment plays an increasingly important role in terms of positive impacts on achievement of economic goals.

Development of tourism business has become a subject of interest for state policy makers, and an integral part of national economic development strategies (Mishra & Himansu, 2010) Pacific Asia Travel Association (2014) forecasts that Asia Pacific destinations will receive 33 million more foreign arrivals in 2015 compared to 2014. Although international tourism is an economic activity, it is also a way in which many people interact. It therefore causes high demand on services and facilities that generate challenges and opportunities to host countries (Dieke, 2000).

Prospects of tourism industry in Bhutan Bhutan has greatest potentiality to develop tourism sector the near future. In 1974, foreign tourists came to see the coronation of the fourth king of Bhutan. More than 150000 in 2015. Although the western and southern region has tremendous tourism potential, the tourism industry in the area is still miles to go to exploit the proper potentialities. Tourism business in Bhutan is based on Wildlife, Historical Monuments, Ethnic cultural heritages beside other economics activities.

The whole tourism potentialities of the country can be grouped together under the following categories: (a) Culture, (b) Adventure , (c) spiritual and wellness ( d) Nature, (e)Tshechu and Festival, (f) Trekking Source: Bhutan tourism monitor, annual report 2014

Why visit Bhutan?-Major Attraction Taktsang goemba (Tiger’s nest Monastery) Taktsang is one of the most important Buddhist monasteries in Bhutan.it’s history goes back to 8th century. It is situated on a cliff about 3000m north of Paro District. The monastery was built in 1692 by Guru Rinpoche who flew on this cliff from Tibet on the back of a flaming tigress

2.Tsechu (Festivals) Tshechu is the annual religious festival in Bhutan. It is conducted in all the dzongs and major monasteries. Tshechus are social gatherings where people from near and far gather to witness mask dances and cultural items.

3. Gross National Happiness

4. Highest unclimbed mountains and mountain trekking Bhutan has the highest unclimbed mountains in the world – Mount Jhomolhari, Jitchu Drake, kulagangri, etc. The government prohibits mountaineering in in some of the peaks which the Bhutanese believe are the abode of deities and spirits.

5. Museums and monuments Bhutan is home for numerous Museums that entails the rich traditional, culture history, and art and folks from the peoples. It showcases the history of Bhutan starting from the advent of Guru Padmasambhavain in the 8th century. The museums are mostly state owned and funded

6. A spiritual Heaven With the visit of Guru Padmasambhava, Buddhism began to take firm roots within the country and this especially led to the propagation of the Nyingmapa (the ancient or the older) school of Buddhism

Problem to rise tourism industry in Bhutan. The main constraints coming on the way to sustainable tourism are identified as lack of physical infrastructure to meet the expected demand, communication bottlenecks lack of fund Internet coverage, the speed and the bandwidth is quite limited in certain areas of the country, Accommodation is still lacking in central and eastern Bhutan, Acceptance of credit cards is also not wide spread, Food items are not quite well diversified Tourism policy Absence of roadsides amenities. Limited no of standard hotels and lodges, Few number of attractive tourist spots, Growing number of informal tourism.

Suggestion to improve the scenario. More Private companies should be encouraged to promote tourism venture in the country. Transport service of the nation should be improved including railway service. Planned efforts are to be made by the Government to build up the required infrastructure of the country. Proper tourism development policy including immigration policy is needed to strengthen the tourism industry in Bhutan. Preservation of culture and tradition to attract more foreign tourist is of utmost importance for the development of tourism sectors in Bhutan. The influx of Indian tourists into the country without routing through local tour agents, known as informal tourism need to update. Development of new cultural events for tourists during dry season. Increasing the number of entry points (allowing tourist to enter and exist along the eastern boarders.) Balanced and equitable development throughout the country. Initiate domestic air transport option for efficient movement of tourist during adverse weather conditions.

Conclusion

References