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Is Bhutan Richer Than Nepal?

Is Bhutan richer than Nepal? :- Bhutan and Nepal both are small, landlocked Asian nations. They are bordered by the large and strong nations of China and India, The rugged physical terrain and the lofty Himalayan Mountains deepen their geographical isolation.

Both countries likewise share ethnic and religious relations and the territories of ancient dynasties are defined by their borders. These Himalayan kingdoms have cultures that are profoundly rooted in religions that are firmly interwoven: Buddhism and Hinduism. One very fascinating likeness is that these nations are among the very few that Europeans have never colonized in the world.

In account of economy, you can’t compare Nepal and Bhutan since the economy of Nepal is a lot bigger than Bhutan. In fact, Nepal has a much higher GDP than Bhutan does, however much smaller population of Bhutan is able to enjoy much more with less exertion because of the strong population gap. 

In 2015, the GDP of Nepal was about $21.2 billion US dollars, while the GDP of Bhutan was about $1.96 billion US dollars.


But, compared to Nepal’s 2.7 percent, Bhutan had a higher GDP growth rate at around 6.4 percent (generally because of the earthquake and political turmoil, and it was about 0.8 percent in 2016 and had gradually recuperated until high value notes were demonetized by India).

And Bhutan has a much higher GDP per capita PPP (this is purchasing power) than Nepal at about USD $7,861 while Nepal had USD $2,312.39 in 2015.

The purchasing power per capita depends on the population size of nations and the distribution of income. Bhutan has far less individuals, around 774,830 people (currently about 734,000), than the huge 28.5 million population of Nepal. In Bhutan, this suggests that wealth distribution is easier and simpler, at least in theory.

Bhutan receives 63 percent of India’s total foreign assistance, which is about $981 million, out of its total foreign aid of $1.6 trillion. This implies that roughly 49% of Bhutan’s GDP currently comes from foreign assistance from India.


The fundamental sources of revenue for Bhutan are hydropower sales to India and its good tourism sector (where Bhutan charges $200 per individual every day for tourists to visit). Bhutan has been as of late extending its hydroelectric export capacity as well as seeking to offer its people some modern facilities (however this is as yet a questionable issue because of Bhutan’s administration needing to protect its traditional culture in this very modern world).

Note: Bhutan took advantage of its partnership with India to have almost all hydro dams constructed and operated in Bhutan, the majority of which actually need Indian support to remain operational.

In doing so, costs are basically non-existent for Bhutan and the ownership of dams transfers to the Bhutanese government after a specific period of time which permitting them to produce more income.

India had a need to provide sustainable power to its North East at the point when the dams were built, and so they could support Bhutan in the process.

The other thing is, in exchange for letting India manage Bhutan’s external affairs and making Indian troop bases in the mountains, Bhutan gets an enormous amount of financial assistance from India.

It might appear as though it’s better off, however in actuality the strong foreign aid and a much smaller population make Bhutan incomparable to the economic problems and problems of Nepal.

By shifting its economy from being completely dependent on India, Nepal has tried to diversify trade, however India has been playing power politics (as well as domestic political issues among Nepali politicians) that have hindered progress that would help the Nepalese people.

Even the previously Pro-India Dahal has begun to swing more towards China to counter balance Nepal’s overreliance on Indian trade and resources in order to mitigate this. This is the place where, due to dependence and dependency on India, Bhutan has benefited from Indian favoritism for aid and trade.

In Nepal, for the most part, the nation’s wealth is spread equally amongst the populations and there are no royal families controlling everything from factories, government, media, tourism and even embassies.

In Bhutan, almost everything from ministries, administration, property, factories, the military and even the media is dominated by some 15 or 20 feudal families affiliated with the royals.

With the exception of this elite party, everyone lives in 1-room homes with a few acres of land and a few cattle. They don’t have the foggiest idea what universal human rights are. They call it the ‘Gross Measure of Happiness.’

In comparison to Nepal, the wealth possessed by the feudal families of Bhutan may make their per capita GDP appear to be higher, however that doesn’t make a perennial Bhutani richer than a Nepali.

 Economic Indicators Comparison

Gross Domestic Product & Income

GDP growth, 1 year5.8%6.3%
GDP growth, 5-years average6.1%4.8%
GDP per capita$3.2k$1k
GDP per capita growth1.82%4.91%
Purchasing Power Parity conversion factor21.8134.93
Price level ratio of PPP conversion factor GDP to market exchange rate0.320.33
GDP per capita, PPP adjusted$9.5k$2.9k
GNI, Atlas method$2.2B$27.2B
GNI per capita$3k$970
GNI, PPP adjusted$7B$87.4B
GNI per capita, PPP adjusted$9.3k$3.1k

Government debt & reserves

Central government debt, % of GDP102.6%30.4%
External debt stocks, % of GNI109.2%18.9%
External debt stocks$2.5B$5.5B
Short-term debt, % of total reserves0.4%3%
Total debt service, % of exports and primary income10.7%8.5%
Adjusted net savings including particulate emission damage, % of GNI23.3%38.1%
Gross savings, % of GDP21.6%49.5%
Gross capital formation, % of GDP47.5%55.2%
Total reserves including gold$987.2M$8.3B
Foreign direct investment net inflows$2.6M$68.2M

Exports, imports and economic structure

Exports of goods and services, % of GDP30.8%8.9%
Imports of goods and services, % of GDP55.9%46.3%
Current account balance (balance of payments)-$497.6M-$2.8B
Revenue excluding grants, % of GDP18.5%22.9%
Grants excluding technical cooperation, BoP$49.2M$629.7M
Personal remittances received$58.1M$8.3B
Industry including construction value added, % of GDP38.3%13.5%
Agriculture, forestry and fishing value added, % of GDP15.9%25.3%
Charges for the use of intellectual property, payments BoP$304kN/A
Charges for the use of intellectual property, receipts BoP$11kN/A
Expense, % of GDP18.5%19.4%
Government Expenditure, % of GDP31.1%27.2%