Bhutan SDF hike boomerangs, government announces discount

NIRMALYA BANERJEE, EOI, KOLKATA, SEPTEMBER 3, 2023 : Going by reports in the online edition of Kuensel, the national newspaper of Bhutan, the policy of the Bhutan government of imposing Sustainable Development Fee on Indian tourists visiting the Himalayan kingdom and hiking the SDF for foreign tourists from $65 a day to $200 has boomeranged. 

Faced with a sharp drop in tourist arrivals, the Bhutan government has been forced to arrange a discount of 50 percent on SDF payable by dollar- paying tourists. Industry, Commerce and Employment Minister of Bhutan Karma Dorji has been quoted as saying that it has been difficult to meet the target set for tourist arrivals in a year. 

“It would be very difficult to reach tourist arrivals at the pre-pandemic levels by 2025, going by the current trend of arrivals.” 

As a result, the government had to provide a 50 percent discount on the SDF for dollar-paying tourists to boost the tourism sector. 

Last week, the discount of 50 percent was announced for dollar-paying tourists to boost the tourism sector. 

Thus, effectively, the SDF has now come down to $100 a day. The SDF rate applicable to children aged between six to 12 years for children of dollar-paying tourists visiting the country as tourists has also been brought down by 50 percent. The new incentive, which has come into effect from September 1, will continue till August 31, 2027. 

More than 78,000 tourists have visited Bhutan since the reopening of the country for tourism on September 23, 2022. But, this number has fallen short of the target set by the Bhutan government of 95,000. The goal is to achieve the pre- pandemic levels of tourist arrival by 2025. Among these tourists, only about 24,266 tourists spending in U.S. dollars have arrived in Bhutan. 

Out of them, 10,549 tourists visited at the old SDF rate of $65 as they had booked their trips before the introduction of the new rates. Besides, 54,613 Indian tourists visited Bhutan, paying an SDF of Rs 1,200 per day. It appears that the dollar-paying tourists were not ready to pay more than $100 a day as SDF, the report says. 

From June this year, the government has also been providing incentives on SDF to visitors coming for a long stay and exploring all the 20 dzongkhags of Bhutan. In a two-month period, however, it has been found that even this has not been effecting in boosting tourism. Instead, because of the steep hike in SDF, tourist are opting for shorter stays; not more than four to five days.