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COUNTRY PROFILES


PROFILE

Country Profile

Area: 38,394 sq km (2008)
Population: 658,888 (UN sponsored census in May 2007). 33.1% of the population are under the age of 15yrs. 69.1% of the population live in rural areas and 30.9% in urban areas (2005)
Capital City: Thimphu
People: Three main ethnic groups: Tibeto-Mongoloid mainly in the North and West, Burmo-Mongoloid mainly in the East and Indo-Aryan (Nepalese) in the South.
Language(s): Dzongkha is the official language. There are some 14 other languages spoken including Nepalese dialects. English is very widely spoken and is the language of education.
Religion(s): Mahayana Buddhist 75%, Indian- and Nepalese-influenced Hinduism 25%
Currency: Ngultrum (BTN). The Ngultrum is at par with the Indian Rupee.
Major political parties: People’s Democratic Party, Druk Phuensum Tshogpa (National Harmony Party). Since the election in March 2008 the DPT forms the Government.
Government: Constitutional Monarchy with bicameral Parliament consisting of the National Council (25 members) and the National Assembly (47 members) elected by universal suffrage from 47 constituencies. Parliamentary elections are held every five years.
Head of State: H.M. Jigme Khesar Namgyal Wangchuck, Fifth King of Bhutan.
Prime Minister: Jigme Yoeser Thinley
Members of international groupings/Organisations: UN, IMF, World Bank, SAARC, INTERPOL, IOC.
Development Cooperation Partners with offices in Bhutan: Austria, Denmark, India, Japan, Netherlands, Switzerland, SCF(USA), WWF
UN Agencies with offices in Bhutan: FAO, UNDP, UNFPA, UNICEF, WFP, WHO.

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HEALTH

Bhutan currently has an estimated population growth rate of 1.03% (est. 2008) and a life expectancy of 65.0 yrs (2006). The infant mortality rate (< 1 yr) is estimated at 63 per 1,000 live births (2006). The level of HIV infection in adults is estimated at less than 0.1% (pop between 15-49 years). 84.2% of the population have access to piped water (2007).

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ECONOMY

Basic Economic Facts

GDP: Nu.54,149.8 Million = approx USD 1130.5 million (2009)
Real GDP Growth: 5% (2009)Major Industries: Hydroelectricity generation, Agriculture, Forestry, Tourism
Major trading partners: Exports – India, Bangladesh and Singapore; Imports – India, Singapore, Japan, China, US, UK
Aid & development: The Government of India finances nearly three-fifths of Bhutan's budget expenditures. Bilateral aid programmes are operated by Denmark, Japan, Switzerland, the Netherlands, Austria, and the European Union, and the United Nations Development Programme (UNDP) maintains an in-country office.
Exchange rate: £1 Pound Sterling (GBP) = Nu 78.6 Bhutanese ngultrum (BTN). The value of the ngultrum is pegged at 1 Indian rupee. (November 2011)

Bhutan has pursued a cautious policy of modernisation while retaining a significant agriculture-based economy. Agriculture employs about 64.2% of the workforce (2006) and accounted for 21.4% of GDP in 2006. Tourism is Bhutan largest hard-currency earner, providing USD 29 million in 2007.

There is little heavy industry, apart from a cement plant, a chemical plant and a timber factory; most manufacturing is via small-scale local industries. The export of hydro-electric power to India is a growing industry and is the single most important source of revenue. Bhutan has an estimated hydropower potential of around 30,000MW, of which so far only about 2,500MW is exploited. India is by far the largest market for Bhutan's exports and is still a significant source of development aid. Bhutan’s tenth Five Year Plan commenced in 2008. The Economic Development Policy (EDP) has as its priority the strengthening of the economic base and emphasises Bhutan’s concept of ‘gross national happiness’. A new Foreign Direct Investment (FDI) Policy is now in place, which puts priority on FDI in the areas of tourism, educational facilities and hydropower, among others. A major aim is to provide employment for the growing number of educated young people.

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HISTORY

Bhutan is a Mahayana Buddhist Kingdom. Buddhism was brought to the country from northern India in the 8th Century by Guru Padma Sambhava. Hinduism is the second largest religion. The country’s administration, legal system and defence were unified in the mid-17th Century by the Shabdrung Ngawang Namgyal, a prominent monk from Tibet. The Shabdrung set up a dual-system of government with temporal and religious leaders. In 1865, following a military conflict known as the Duar Wars, Britain and Bhutan signed the Treaty of Sinchula, under which Bhutan would receive an annual subsidy in exchange for ceding some border land in the South. Three years later, a treaty was signed whereby the British agreed not to interfere in Bhutanese internal affairs and Bhutan undertook to seek the advice of Britain in the conduct of its foreign affairs. This Treaty was assumed by India at Independence in 1947 but has now been replaced. The hereditary monarchy came into being through election in 1907. In 2007 the Fourth King Jigme Singye Wangchuck abdicated in favour of his son the present King, Jigme Khesar Namgyal Wangchuck, who is the great-great-grandson of the founder. The King was educated in Bhutan, the United States and at Oxford University. On 13 October 2011 the King married Gyaltsuen Jetsun Pema.

In 2008 the King signed Bhutan’s first Constitution by which Bhutan became a fully constitutional monarchy with a multi-party democratically elected Government. The first elections were held in March 2008. BBC News Country Timeline: Bhutan (http://news.bbc.co.uk/hi/english/world/south_asia/newsid_1171000/1171693.stm)

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INTERNATIONAL RELATIONS

Bhutan's Relations with India

Bhutan has strong and friendly relations with the Government of India at the diplomatic, political and economic levels. Indian Prime Minister Singh visited Bhutan 16-18 May 2008 and the King and Queen of Bhutan visited India from 23 to 31 October, 2011. This was the first overseas visit by the King and Queen after the Royal Wedding on 13 October, 2011.

Bhutan had a Friendship Treaty (1949) with India under which it agreed to be guided by the advice of India in its external relations. This clause was removed in a new Friendship Treaty which was signed by India and Bhutan during the Bhutanese King’s visit to India on 8th February 2007. The Indo-Bhutan Friendship Treaty of 2007 strengthens Bhutan's status as an independent and sovereign nation.

Bhutan enjoys preferential trade and transit facilities and benefits from Indian aid (India finances nearly three-fifths of Bhutan's budget expenditures). The export of hydro-electric power to India is Bhutan’s most important source of revenue. In June 2006, the 1972 free-trade agreement (which permits Bhutan to import and export goods via India) was renewed for 10 years. India and Bhutan also signed a 60-year agreement to co-operate in the development of hydro-electric power.

The Bhutanese and Indian armies have connections dating back to the early ‘60’s. Most of the training of the Bhutanese Army is carried out by the Indian Military Training Team (IMTRAT) in Bhutan. In December 2003 the Bhutanese Army, personally led by the King, undertook a surprise and successful military expulsion of ULFA (United Liberation Front of Assam) and Bodo militants from their illegal camps in South East Bhutan. Although there is no specific evidence to suggest the groups are returning, there have been a few reports that some Indian separatist militant groups are able to infiltrate across the border to escape Indian army pursuit.

Bhutan's Relations with the International Community

Bhutan began to develop its foreign relations by joining the Colombo Plan in 1962 and the World Postal Union in 1969. It joined the United Nations on 21st September 1971, sponsored by India and co-sponsored by Britain. In 1981 Bhutan joined the IMF and World Bank, and in 1982 became a member of UNESCO and the World Health Organisation. Bhutan is also increasing representation at international conferences and is an active member of the South Asian Association for Regional Co-operation (SAARC). Bhutan hosted the 16th summit 28-30 April 2010.

Currently Bhutan has formal diplomatic relations with twenty two countries - India, Bangladesh, Japan, Thailand, Kuwait, Pakistan, Sri Lanka, Singapore, the Maldives, Republic of Korea, Bahrain, Australia, Canada, Nepal, Norway, Finland, Switzerland, Austria, Denmark, Finland, Netherlands and Sweden. Bhutan does not have diplomatic relations with any of the permanent members of the UN Security Council. In March 2009 Bhutan established an Embassy to the European Union in Brussels with a resident Ambassador who is also accredited to those European countries with which Bhutan has formal diplomatic relations.

There is also an Ambassador to the United Nations resident in Geneva and a Permanent Representative to the UN in New York. Bhutan has Honorary Consuls in the UK, France, Germany, Netherlands, Denmark. The only foreign Ambassadors resident in Bhutan are those of India and Bangladesh.

The Bhutanese Foreign Minister visited China in early 1999 and the two countries signed an agreement committing them to a relationship of 'peace and tranquillity', but without formal diplomatic relations. Friendly border negotiations with China have taken place over the last twenty years and the border is now almost entirely agreed. Relations with Nepal are friendly though affected from time to time by the refugee problem. Bhutan has expanded its trading ties with Bangladesh.

Bhutan's relations with the UK

The UK does not have diplomatic relations with Bhutan though we are willing to do so in principle. Bilateral relations are friendly and we conduct business with Bhutan through our High Commission in New Delhi and via the Bhutanese Honorary Consul who is based in the United Kingdom and spends half the year in Bhutan. The British High Commissioner to India visited Bhutan in April.

UK Development Assistance

In 2008, the FCO presented a wedding gift to the King of Bhutan with a full Chevening scholarship (worth approx. £22,000) as a coronation gift. A joint FCO and Bhutanese government interview panel has selected a Bhutanese national to take up this scholarship in 2010. We hope the gift will be seen as a unique & unusual gift that would stand out from the usual coronation gifts and be seen as a gift to the King for the benefit of the people of Bhutan.

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GEOGRAPHY

Bhutan is a landlocked country situated in the Himalayas between China and India. The terrain is mostly mountainous with some fertile valleys. The southern border with India is at an elevation of a few hundred feet. The northern border with China (Tibet) is at heights of over twenty thousand feet. The climate varies between tropical in the southern plains to cool winters and hot summers in the central valleys with severe winters and cool summers in the high Himalayas. In Dzongkha the name for Bhutan is ‘Drukyul’ meaning land of the Thunder Dragon; this name derives from the ‘Druk’ sect of Buddhism in the country, so named because when it was founded thunder was heard and said to be the roar of dragons in the sky.

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TRADE AND INVESTMENT

Trade and lnvestment with the UK

Trade is minimal. UK exports to Bhutan in 2007 totalled around £1 million, while imports from Bhutan totalled £58,000.

The Government of Bhutan recently issued new rules intended to encourage and facilitate Foreign Direct Investment, along with a new Economic Development Policy. Targetted areas for the FDI include tourism, education and hydropower.

UK Trade & Investment Country Profile: Bhutan (http://www.uktradeinvest.gov.uk/ukti/bhutan)

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POLITICS

In the 1950s Bhutan established some representative political institutions, including an indirectly elected National Assembly (Tshogdu Chhenmo) and elected village headmen, but there were no political parties. In 1998 the Assembly elected a Cabinet for the first time.

In March 2005 the draft of the first written constitution was published and the King initiated public discussions in October 2005. The constitution came into effect in 2008.

In December 2005 Jigme Singye Wangchuck announced that he would abdicate in 2008 and that Bhutan would hold its first general elections in that year. However on 14 December 2006, he announced his immediate abdication and transfer of the throne to his eldest son Jigme Khesar Wangchuck. The official coronation of the new King took place on 6-9th November 2008.

Following the introduction of the first Constitution, the new democratic system comprises an upper and lower house the latter based on political party affiliations. There is no limit to the number of political parties which can exist, though they must all be registered with the Election Commission. However, in a unique system, there are two rounds of elections for the National Assembly. In the first round the people vote for a political party. The two parties which receive the most votes are the two parties which can then contest for seats in the National Assembly.

Elections for the 20 elected seats of the 25 member upper house (National Council) were held on December 31, 2007, while elections for the lower house, the 47-seat National Assembly, were held on March 24, 2008. Two political parties, the People's Democratic Party (PDP) headed by Sangay Ngedup, and the Druk Phuensum Tshogpa (DPT) headed by Jigme Yoesar Thinley, competed in the National Assembly election. The Druk Phuensum Tshogpa won the elections taking 45 out of 47 seats in the parliament. There are ten Cabinet Ministers. The elected Government holds office for a fixed period of five years.

Under the Constitution, the combined Upper and Lower Houses may in certain circumstances require the abdication of the reigning Monarch in favour of the heir. The monarch may be either male or female.Independent Constitutional Bodies include the Anti-Corruption Commission, the Election Commission, and the new Supreme Court.

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HUMAN RIGHTS

While there are no legal human rights NGOs in Bhutan, the Bhutanese have allowed access for various human rights organisations. The then UN High Commissioner for Refugees, Mrs. Ogata, visited in her final year in office in 2000. The International Committee of the Red Cross visits regularly, most recently in 2009, and is allowed unimpeded access to all detention facilities and prisoners therein.

Bhutan has signed and ratified the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW), the Convention on the Rights of the Child (CRC) and the International Convention on the Elimination of all forms of Racial Discrimination (CERD).

The Constitution of Bhutan guarantees important basic human rights such as the right to freedom of worship and the right to free speech. However, religious proselytisation by unfair means is not permitted.

Refugees

Over the last century or so the Nepalese have had a history of emigration to the northern parts of the sub-continent. Many went to the lowlands of Bhutan. Some of these lowlands with significant ethnic Nepali populations, for example Cooch Behar, were confiscated from Bhutan by the Treaty of Sinchula, and are now part of India. However, in the late 1980s Bhutan tightened up the implementation of its citizenship law, required all citizens to adhere to a single cultural code and placed increasing pressure on ethnic Nepalese who could not prove their citizenship entitlement (mainly based on residence in Bhutan prior to1959). Between 1990-93 thousands left Bhutan. Some valid Bhutanese citizens voluntarily emigrated, usually with their non-Bhutanese relatives, and thereby under Bhutanese nationality laws lost their entitlement to Bhutanese nationality. Allegations of human rights violations by the relatively untrained security forces during this period are commonly voiced by occupants of the camps. According to UNHCR, over 67,000 Bhutanese are in UNHCR-run camps in eastern Nepal. (There are also claimed to be about 15,000 refugees in India concentrated in West Bengal and Sikkim, though this figure is unsubstantiated). As a result of bilateral discussions with a succession of governments in Nepal a joint Nepal-Bhutan verification team commenced work in 1993 to verify the exact background of the occupants of the UNHCR camps. This exercise was brought to a halt when violence broke out in the camps in December 2003. In an interview in February 2009 with a delegation of members of the EU Parliament the Prime Minister indicated that he aimed to make significant progress on a solution to this problem during his term of office.

The UK took around 100 Bhutanese Refugees from Nepal in 2010. The UK as part of its Gateway Resettlement Programme agreed to resettle up to 750 refugees in 2010/2011 from a number of different locations globally including resettling Bhutanese refugees currently in Nepal. The United States as well as a number of other countries have resettled a large number of inhabitants of the UNHCR camps in Nepal. To date a total of over 45,000 have been resettled with this process ongoing.

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Last Updated: November 2011

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