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Bhutan’s Paradoxical Development

Submitted by on May 13, 2013 – 2:40 pm 18 Comments |  
Himalayan GDP Per Capita MapThe southern rim of the Himalayas is rarely mapped as a region, as it encompasses two independent countries (Nepal and Bhutan) and five Indian states.* As a result, maps depicting economic and social development of the area can be misleading, as they typically contrast the two Himalayan countries with India as a whole. To address this situation, I have made a per capita GDP map of the seven relevant states as if they were equivalent geopolitical entities. As can be seen, politically troubled Nepal lags behind the rest of the region on conventional economic grounds. The comparison between Nepal and both Uttarakhand and Himachal Pradesh is striking, as the three states have much in common in regard to both physical and human geography. If one were to map a variety of social indicators, the contrast would be even starker.

As can also be seen, Bhutan has by far the highest per capita GDP figures in the region. The Bhutanese economy has also been growing at a rapid pace in recent years. In 2007, it posted the world’s second highest rate of economic expansion: 22.4 percent. Such figures may seem odd, as the government of Bhutan has long been suspicious of conventional economic development, stressing “gross national happiness” instead of “gross national product.” The country has also been noted for its subsistence-oriented economy and its relative separation from the global market. As framed by the Wikipedia:

The economy of Bhutan, one of the world’s smallest and least developed, is based on agriculture and forestry, which provide the main livelihood for more than 60% of the population. Agriculture consists largely of subsistence farming and animal husbandry. Rugged mountains dominate the terrain and make the building of roads and other infrastructure difficult and expensive.

Bhutan has been lauded by many critics of the global economic order for its heterodox position on development. The Bhutanese government’s recent decision to convert all agriculture to organic methods has received an especially favorable response from the environmental press. As one recent article put it:

“Bhutan has decided to go for a green economy in light of the tremendous pressure we are exerting on the planet,” Agriculture Minister Pema Gyamtsho told Adam Plowright of L’Agence France-Presse in an interview by telephone from the capital Thimphu. “Intensive agriculture requires the use of so many chemicals, which is not in keeping with our belief in Buddhism. We must live in harmony with nature.”

In light of such policies, Bhutan’s rapid economic growth and its relatively high level of per capita GDP do seem unusual. The answer, however, is relatively simple: dam building followed by the export of electricity to India. As it turns out, Bhutan’s 22.4 percent GDP expansion in 2007 “was mainly due to the commissioning of the gigantic Tala Hydroelectricity project.  Hydroelectricity and infrastructure-based construction continue to be the two major industries of growth for Bhutan despite natural constraints posed by the country’s extremely rugged terrain.”   And as emphasized by the CIA World Factbook, “The import of equipment and fuel to build hydropower plants [in Bhutan] is leading to large trade and current account deficits, though new hydropower projects and electricity exports to India are creating employment and will probably sustain growth in the coming years.”

Hydroelectricity is in many respects an environmentally benign form of economic development, as it generates power in a renewable manner, with little release of greenhouse gasses.** Environmentalists, however, typically oppose hydropower due to its corrosive effects on local ecosystems and indigenous peoples.

The disconnection between environmental and developmental rhetoric in Bhutan, both by the Bhutanese government and by outside supporters, has led to some pointed revisionism that emphasizes the country’s problems. A 2009 article from India’s Economic Times is especially pointed:

Large dams are not usually regarded as recipes for happiness. Environmentalists usually condemn them for displacing people and submerging forests. Bhutan’s neat ploy has been to adopt a green name (Druk Green Power Corporation) for its hydropower producer. It gets away with this since environmentalists don’t want to attack a much ballyhooed Shangri-La of happiness.

… A nasty ethnic struggle has led Bhutan to expel 100,000 people of Nepali origin, who now languish in refugee camps in Nepal. Ethnic Bhutias constitute 50% of Bhutan’s population, and ethnic Nepalese 35%. Nepalese migrants have swamped original ethnic groups in neighbouring parts of India like Sikkim and Darjeeling. The Bhutias of Bhutan are determined not to be swamped too. Those expelled say they are regular citizens who have been ethnically cleansed, while the government claims they are illegal immigrants. Such ethnic strife does not look like a recipe for happiness.

In most countries women outnumber men. But Bhutan has only 89.2 females per 100 males. This is worse even than India (93.3 females per 100 males) where female foeticide and infanticide are common. Bhutan’s gender ratio suggests strong discrimination against female children in access to health and food.

The CIA World Factbook estimates literacy in Bhutan at 47%, while a recent Bhutanese publication puts it at 59.5%. The country banned TV for decades to protect its people from pernicious modern influences, but finally allowed TV in 1999. Low literacy and media bans are not usually associated with happiness, but some will say that ignorance is bliss.

Bhutan Gender statisticsSuch harsh assessments seem unfair, as Bhutan has made significant progress in social development in recent years. As the graph posted here shows, most young people in the country are being educated, and the gap between male and female literacy levels is decreasing. And while it is undeniable that the country’s sex ratio is highly male biased, that may be changing as well. According to a Wikipedia table on the issue (derived from CIA data), Bhutan has one of the world’s most male-heavy populations in the 15-65 and over-65 age ranges, but its ratio in the 0-15 bracket is actually slightly less male-biased than the global average.

Himalayas Map*Parts of Pakistan and even Afghanistan are often included in the region as well, as can be see on the Wikipedia map posted here.

**Not all hydropower project, however, are climatically friendly. Dams in low-elevation areas covered with dense vegetation can actually produce more greenhouses gases—methane in this case—than coal-burning plants. The prime example is Brazil’s Balbina Dam.


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  • The volume of state-sponsored ethnic cleansing in Bhutan, though, to the extent of something like a third of the pre-1990s population, has to be taken into consideration. If a country can score highly on scales on happiness as defined by its leadership only by expelling a politically active and ethnically problematic minority …

    (One can explain it as being motivated by the fear that Bhutan, the last of the traditional Buddhist polities of the Himalayas, would end up being absorbed into India like adjacent Sikkim.)

    • You make an excellent point, Randy! I mean about “happiness” achieved in dictatorial/totalitarian countries by expelling/killing those who are opposed to the imposed “happiness”: North Korea, Nazi Germany, and Soviet Union under Stalin come to mind…

      P.S. I am working on a mini-series about ethnic cleansing under Stalin — stay tuned!

      • Then, Asya, you should look at the weekly graph in this week’s Economist on deaths from famine in the 20c. Europe has a surprisingly high number in the 1920s and 1930s, until one remembers that Ukraine and the rest of the chernozem are in Europe.

        • Good point, James! Actually, my mini-series is about ethnic deportations, but you’re right there are many ways to get rid of an ethnic group. I could widen the scope, and perhaps some day I will, but when one gets into ethnic groups that suffered persecution under Stalin, it’s hard to know when to stop!

          • Ezr

            Sorry if I sound preachy here, but let’s not forget the American glorification of the “unalienable right” to “liberty and the pursuit of happiness” that everyone supposedly had – except for slaves and of course the decimated/forcibly resettled Native Americans, who apparently had different ideas about how to be happy… one has to wonder if those ethnic groups simply didn’t fit into the old WASP definition of “happiness”. In a way, sadly, there’s no need to look for exotic dictatorial regimes when it comes to such cruel ironies. The idea that “everybody is equal, but some are more equal than others” seems to be all too common throughout the world, even in modern democracies. Another fitting comparison might be with European populists who even today would like to expel, segregate or persecute certain groups of immigrants on the grounds that they represent a threat to “European freedoms” (?!), which seems to completely defeat the point.

          • When it comes to Native Americans and African Americans, I believe at the time of the Declaration of Independence, they did not fit the author’s definition of “man”, not “happiness” (which is no less sad, of course). Still, putting it into its proper context, one shouldn’t forget that the idea of inalienable rights of man (whoever falls under that definition) was a very progressive idea at the time. We tend to forget that.

            Re: your claim that “the idea that ‘everybody is equal, but some are more equal than others’
            seems to be all too common throughout the world, even in modern
            democracies”— as someone who has lived in both an “exotic dictatorial regime”, as you refer to it, and in modern democracies, I think it’s really grossly mistaken.

            Finally, I can see the point of those who fear that certain groups of immigrants may threaten “European freedoms”: the point is not that they have a different definition of “happiness” (for themselves) but that they may (according to those who fear, will) impose it on others.

          • Ezr

            Well, as someone with family who had to endure two dictatorships (Brazil and Uruguay) that engaged in widespread torture and were trained, helped and financed by so called “Western Democracies” in the name of strategic alliances and cheap goods, I can tell you that yes, when freedom and happiness at home is ensured by oppression and misery elsewhere, there is a problem. I suspect one hundred years from now people will look at our contradictions the way we look at all those “slave-owning, injun-hunting freedom fighters”.

            As for “imposition” fears, I agree that may be an issue in some places, although it is often overstated or used as a cover for old-style xenophobia.

          • Ezr

            P.S.: As an addendum, apologies if I have used politically-loaded language. Though inevitable given the subject, I understand this isn’t exactly the right place for that.

          • No problem, we’ve had worse.

          • Old-style xenophobia may have something to do with it, but certain groups do tend to impose their “rules of the game” onto societies they move to, given half the chance. Others do not. True xenophobia would treat both types of groups equally, so that’s perhaps a test.

          • Ezr

            You mean Sharia? Considering that this issue pales in comparison to what was imposed by the old metropolises and metropolitan settlers on the countries of origin of those immigrants, I’m not sure it’s fair to single out anyone. Some groups may at times act as nastily as their former masters, but probably no worse. Cynics might even see this as poetic justice of sorts.

            Also, I was under the impression that there may be degrees of xenophobia? In any given country, not all foreigners or ethnic groups are hated/mistrusted/stereotyped equally but all such attitudes could still be generally called xenophobia, no?

          • This sounds like a lot of ideologized rhetoric. Any specific examples of uncivilizing impositions by colonial powers on the colonized?

            My point about two types of groups, those who do want to impose their worldview and law on the others and those that don’t, is that a true xenophobe would hate both, i.e. would hate other ethnic groups regardless of their impact on the xenophobe in question. I.e. xenophobia = hatred for no reason. Rejection of violence towards women/homosexuals/those of other religions etc. isn’t necessarily xenophobia.

          • Ezr

            I’m not quite sure what ideologized rhetoric means. Rhetoric by definition is just an instrument to argue on something preestablished, and surely we all see the world through a certain preestablished frame of reference? Certainly as someone from Latin America I have experienced things that have shaped my views which others have not. Odd as it seems, some of the heroes of progressive Eastern Europeans in the 20th century were the foes of progressive Latin Americans, for very different but perfectly understandable reasons. I believe the truth is somewhere in the middle, anyway.

            Still, some facts can’t be dismissed. Or are not arbitrary punitive raids, violent enthroning of brutal but amenable leaders, suppression of local beliefs, blackbirding, forcible acculturation, land-grabbing – imposition enough? Now, one may always question the significance or even the gravity of such events, but they serve as a reminder of certain contradictions.

            Anyway, I promised not to detract too much from the original discussion, and so will stop here. We disagree on means, interpretations etc., but seem to agree on most goals, and that’s ok by me.
            Thanks for taking the time for this discussion. “Ideology” aside, I’ve always liked this blog for the thoughtful consideration given to the views of each commenter.
            Now, I suppose I (we?) have to get back to good ol’ linguistics!

          • Well, thanks for the praise of the blog!

    • Excellent points — perhaps I should have written more on the ethnic cleansing of Nepalis in the country.

  • Very interesting about the ethnic tensions. With a country of subsistence farmers and a sprinkling of hydroelectric engineers, I wonder what the gini coefficient might be.

    • Interesting question. The World Bank ( shows it as as falling from 46 in the 1990s to 38 in 2007, which is quite low. I am a bit suspicious of such data, however.

      • I’m suspicious of those number as well. With that GDP growth and that Gini coefficient, there should not be very many subsistence farmers, hobby farmers maybe, but not subsistence farmers.

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