BHUTAN: The Emerging High Volume – Low Value Tourism Destination

Day before yesterday I was passing by Norzin Lam when I chanced upon a heart-breaking scene that ought not to be.

Four tourists were cramped inside a small Maruti Taxi – one of them was alighting – visibly irritated and profusely grumbling that she did not need to suffer this level of discomfort.

I wanted to photograph the scene – but decided against it because I believed that this would be tantamount to infringement of privacy – in addition to rubbing salt into the wound.

The legendary Lars-Eric Lindblad. He was a Swedish-American entrepreneur and explorer. He and his USA-based travel company - Lindblad Travel -  led the first-ever tour group to Bhutan in 1974. Supposedly the Darjeeling-based Jesuit Father Richard McDonald and his tour company Summit Tours introduced Lindblad to Bhutan.

Lindblad died of a sudden heart attack on 8th of July 1994. At the end, the man with an unputdownable pioneering spirit died a broken and bankrupt man - most likely caused by the penalty of US$ 75,000.00 imposed on his company by the government of USA - for conducting tours to Vietnam and Cambodia - two countries against which there was an trade embargo imposed by the US government.

It is my belief that tour guides of yore -  the likes of Galing Ngawang Dorji and Sharchop Karchung of present day Lhomen Tours, including the then DoT official Sangey of Ha Wangcha would have had the good fortune to meet the legend.

I spoke about the plight of the tourists to a hapless tourism guide …. and he tells me that now the trained TCB guides are losing their jobs to taxi drivers – because apparently, they are now claiming to be able to provide the service which was earlier, by law, in the domain of the TCB trained and certified guides.

A week back, I was caught with my pants down - literally - inside the toilet of Thimphu’s Kaja Throm – because a friend in the tourism trade decided to call me at that precise moment – and kept me engaged for 10 minutes – grumbling endlessly about the lack of a photocopy machine at the tourist point of entry - to make a copy of his tourists’ papers that the officers needed to process their Entry Permits. The fuming friend wanted to know what the government was doing with the collection of the daily Sustainable Development Fee of US$100.00 per tourist per day – that they are unable to outfit their offices with the most basic, but important and essential office equipment – such as a photocopy machine? Seriously, there are barely four tourist entry points in the country – I mean how is it possible that the TCB or whoever is responsible – is not able to install 4 copiers in the whole of the country - to improve service and experience of the tourists? For God’s sake – they can charge for the service and people will be happy to pay!

And we like to pride ourselves as a High Value, High End Tourism destination! Or, is it High Value – Low Volume Tourism? ---- So utterly confusing! Regardless of what the catch phrase is – we have now arrived at a point that is proving to be: High Volume – Low Value Tourism that is not accruing any benefit – not to the DRC, not to the RMA – and most definitely NOT TO THE INDUSTRY.

A Well-Deserved Honor And Recognition

When I got to learn of the award of the title of Doctor of Philosophy to Lam Kezang Chhoephel by the Thames International University of France, I felt a sense of pride and triumph! To be chosen to rise head and shoulder above the teaming billions, particularly from a minuscule country that more than 99% of the human population would not have heard about - it is a praiseworthy achievement.

Dr. Lam Kezang Chhoephel

By no means I am competent, or even qualified, to pass judgment on his academic or scholastic abilities - I will leave that to people and organizations such as the Thames International University to decide. But I dare say that I have had a number of occasions when I was awestruck by his uncanny ability to provide answers to my questions that I most likely would not have gotten from anyone else in Bhutan, or elsewhere. He has unfailingly proven to be a source, and a depository, for a vast and uncommon knowledge and information on Bhutan and most things Bhutanese.

Over the years since I began my research journey in matters related to our ancient coinage, I have gotten used to making him my first stop - in the pursuit of answers and explanations. For sure he has enriched my documentation of Bhutan's coinage with rare terms such as: “Tsa-Thue”, “Karshapani”, “Ngingtang Ghatikap”, “Grab Tsring .... Grab Tsring”, “Luna Yar Mathop – Ghatika Mar Shorsong” etc. etc.

Thus, day before yesterday, I went to see Lam Kezang Chhoephel - to offer him my congratulatory Dhar. Along with it, I also offered him the following statue of the Golden Buddha gifted to me by the Most Venerable Lam Phra Kruba Bunchum Yannasangvaro Aranyavasi Bhikku of Thailand, in 2016. Certainly Lam Kezang is a more worthy person to own a sculpture of such exquisite craftsmanship:

The exquisite statue of the Golden Buddha

Upon being conferred the following Recognition, as of 14th April, 2024, Lam Kezang Chhoephel earns the right to be addressed as:

Dr. Lam Kezang Chhoephel

The Certificate of Award issued by the Thames International University, France

Dr. Lam Kezang Chhoephel makes us all proud!

Bhutan's Tourism Industry: Disaster Foretold

During early 2022, a select group of BSTS Members met the Chair of the Tourism Council of Bhutan (TCB) in his Chamber at the Gyelyong Tshokhang - in an effort to forestall the dismantling of Bhutan's globally celebrated tourism business model that worked successfully for close to half a century since its institution. This was one of the many desperate attempts made by a passionate group desperate to save the tourism industry from utter ruin - the last and final attempt was made on 22nd June, 2022 when we met the National Assembly's Economic and Finance Committee - in yet another attempted to save the industry from being driven into the ground.

During the Meeting with the Chair of the TCB, following points were submitted in writing:

------------------------

PITFALLS OF DISMANTLING THE MINIMUM DAILY PACKAGE RATE (MDPR)

Submitted to:

His Excellency (Dr) Lyonpo Tandi Dorji

Chair, Tourism Council of Bhutan

Copy to:

Director General

TCBs

Submitted by:

The Working Group Members

Bhutan Sustainable Tourism Society (BSTS)

Points in bullet form:  The Consequences

1. Influx of undesirable tourists

2. Massive decline in foreign exchange inflow

3. Rampant tax evasion – reduction in revenue to the exchequer

4. Hoteliers will suffer the most

5. Fronting – risk of external players taking over the country’s tourism business

6. Cultural dilution and environmental degradation

7. Decline in quality services/products and visitor experience

8. The preferred OPTION: increase in the MDPR

EXPANDED NARRATIVE

The pricing policy of Bhutan based on a Minimum Daily Package Rate (MDPR) is one of the unique features of Bhutan’s tourism development initiative that is held in great admiration by many countries.

In the pursuit of our tourism vision of ‘High Value Low Impact’, the MDPR remains the principal catalyst that has helped the tourism industry grow at an even pace and in the desired direction. Removing this tool would have long-term consequences on the government and the people of Bhutan.

In brief following are some of the obvious consequences:

1. Influx of undesirable tourists: Brand Bhutan has successfully positioned Bhutan as one of the top travel destinations. There is a huge desire in the market to visit Bhutan. So, when we have the opportunity to capitalize in choosing the top end market, removing the MDPR will only weaken this opportunity by making it easier for influx of undesirable tourists.

2. Massive decline in foreign exchange inflow: Presently tourism is the top foreign exchange earner. This is largely attributed to the implementation of the MDPR.

3. Rampant tax evasion: The application of the MDPR ensures that the business of tourism is well regulated and transparent. Removing it will open up opportunities for tax evasion.

4. Hoteliers will suffer the most: While every segment in the business chain will suffer, the hoteliers will stand to bear the major brunt, if the MDPR is removed. The current thinking that they would benefit will not be true. MDPR sets aside a reasonably good amount to meet the room cost. Removing the MDPR would mean the need to succumb to lower room rents considering the stiff competition between the hotels and other accommodation facilities.

5. Fronting: Fronting may already exist, albeit at a small scale. Dismantling the MDPR would encourage the emergence of external players who would begin to decide the direction of our tourism business. They become the masters.

6. Cultural dilution and environmental degradation: Unregulated tourism activities will pave the way for mass tourism and culturally/environmentally insensitive people to overwhelm the country. Our two main pillars of tourism – Nature and Culture will come under direct threat.

7. Decline in quality services/products and visitor experience: Removing the minimum pricing policy would lead to the emergence of negotiated payments with service providers and product developers. This would mean less earnings, resulting in poor service and visitor experience – a direct conflict to our professed tourism philosophy of ensuring high value and satisfying experience to the visitors.

Conclusion 

No system is perfect and we are aware that several problems do exist in the tourism sector. The problems can be addressed if we take an objective and focused approach on those issues but not at the cost of dismantling the MDPR. The MDPR needs to be understood as a tool to improve our services, protect our Brand Bhutan, and add value to the overall growth of sustainable/high value tourism. The success of the MDPR can be seen by the rapid increase in socio-economic development of our people. Believing that the MDPR is an impediment to the growth of tourism is a falsehood – at best it demonstrates a lack of understanding of the principals on which the concept was founded. On the other hand, what is true is that it has empowered the Bhutanese people to have control over tourism growth. Therefore, removing it would have dire consequences on the country and the people of Bhutan.

If ever a change is deemed necessary, the beneficial change would be to increase the MDPR even higher, from the existing level, which has remained unchanged for years.

A case in point – to demonstrate that the MDPR of US$250.00 is not a deterrent is the approach of the high-end hotel chains like the Aman Kora and the Six Senses. Their daily package rates range anywhere between US$1,500.00 – US$4,500.00. Thus, when our country has the potential and opportunity to tap into the high-end market why be foolish to pave way for adversity.

------------------------

Sadly, our above submission was entirely sidelined – the MDPR was consequently demolished – upon passing of the Tourism Levy Act of Bhutan 2022, by the National Assembly of Bhutan during its 29th Session (2nd June to 4th July, 2022.

It did not take too long for our near prophetic predictions to be proven right - the Kuensel, on 11th May, 2024, carried the following news report:

The truth of the failure - as reported by the Kuensel in their news report of 11.05.2024

You can see that we predicted – almost incident-by-incident – what would happen. Sadly, for us, it is not a matter for cheer. In fact, we mourn that we were so totally accurate in our predictions.

Now that the government has had a taste of their pudding, it is our hope that they would have the humility to accept that they have erred ….. that it is time to make amends so that the country’s most vital industry can begin to crawl back to life and its former glory.

BHUTANESE TOURISM INDUSTRY's ANGST: We Told You So!

It is a pity - I ought to listen to my friends and their sound counsel more often than I am wont to do. One hundred and six (106) articles of relentless pursuit of the cause of Bhutan’s tourism …. and I have nothing to show for it. Friends tell me that there cannot be a greater fool than me - that even when it is clear as night and day that no one else gives a rat’s ass - I am still chasing the cause, and extolling the merits of, tourism. And yet, I like to think that if I knock long and hard enough …. the dead will likely eventually rise!

The country was forewarned - time and time again - of the eventuality of the following - under a dismantled MDPR scenario:

This was bound to happen! Even more sinister problems are fomenting with tacit approval of the government.

Under the MDPR regime, the above would have NEVER arisen. The MDPR protected both the tourists and the operators, including the entire gamut of players in the tourism business chain - from incidences of none payment or from none-delivery of promised services. The taxman remained assured that there would be no cases of evasion - the industry was fully under the control and grip of the national operators - rather than in the hands of the carpetbaggers from outside which is rumored to be NOW the trend in Bhutan’s tourism industry.

Today there are rumblings of cash dealings - resulting in unrecorded, clandestine transections that cannot be detected - unlike in the past under the MDPR regime. I am told that some government agencies are perplexed by the severe dip in inflow of foreign exchange and tax collection - despite the government’s claim of a quantum jump in tourist arrivals.

The government and the TCB cannot feign ignorance because they were forewarned - on countless occasions, including with a Note that was submitted to them many months before the passage of the ruinous Tourism Levy Act of Bhutan 2022 which, in part, read as follows:

Conclusion 

No system is perfect and we are aware that several problems do exist in the tourism sector. The problems can be addressed if we take an objective and focused approach on those issues but not at the cost of dismantling the MDPR. The MDPR needs to be understood as a tool to improve our services, protect our Brand Bhutan, and add value to the overall growth of sustainable/high value tourism. The success of the MDPR can be seen by the rapid increase in socio-economic development of our people. Believing that the MDPR is an impediment to the growth of tourism is a falsehood - at best it demonstrates a lack of understanding of the principals on which the concept was founded. On the other hand, what is true is that it has empowered the Bhutanese people to have control over tourism growth. Therefore, removing it would have dire consequences on the country and the people of Bhutan. 

If ever a change is deemed necessary, the beneficial change would be to increase the MDPR even higher, from the existing level, which has remained unchanged for years.”

Will the government finally listen to the voices of the sane and the knowledgeable? A sitting government’s responsibility includes dismantling past evils - trying to get away by saying that they did not do it is - LAME!

Journey of Mercy & Optimism

This was a journey of hope and mercy that I ought to have made by mid-February this year. But life teaches us to accept that compromise is the rule - that there will always be occasions when IMMEDIATE is more pressing than URGENT. Anyway, I was finally able to make my long overdue journey to the fabled Trashiyangtse - on the 1st of May, 2024.

On this trip I did not carry my bird photography gear because as a bird photographer, it dawned on me early in life that fundamental to my journeys will always be the fulfillment of my life’s passion - bird photography. Photography will always be my final destination! On this trip I needed to remain focused on making it to my geographical destination in time ---- and make the return journey without any distractions.

I had the opportunity to finally test out the recent phenomenal gift of the mirrorless Canon R5 camera body. Coupled with a 200mm zoom lens, I shot the distant image of Gangkhar Puensoom from atop Shingner, above Ura in Bumthang. The following massively cropped image will testify to the competence of the famed camera body that boasts one of the highest megapixels of any Canon camera body.

The above image of Gangkhar Puensoom was shot with a 200mm Canon Zoom Lens from atop Shingner in Ura, Bumthang. In order to test its sharpness and resolution, the original image was cropped by about 60%. As can be seen, even at this level of cropping, the image comes through extremely sharp and smooth!

At Trashiyangtse, I photographed the famous Chorten Kora. I wasn’t so terribly enamored by the Chorten because I had visited the place many times in the part – the first time was when I was just 11 years old!

The famed Chorten Kora located in Trashiyangtse. It has a unique annual cultural festival during which time even Dakpas from Tawang in Arunachal Pradhesh of India come visiting.

On my return journey yesterday, I stopped by the wayside - past Rukubji - to record the following photograph of a signboard of a Solar Farm under construction.

The changing face of Bhutan's energy production landscape. Looks like solar energy is going to be an important part of our focus - compact, manageable in terms of size, financing and technology, faster return on investment, less perilous in terms of financial and political bondage etc. Although claimed to be less harmful to the environment, it is a claim that I am not yet prepared to accept whole-heartedly. I think there are aspects that we are ignoring. Still, I believe that harnessing the power of the sun is the lesser evil way of doing things.

The above project - coupled with a few other ongoing installations that I have noticed around the country, encourages me to believe that Bhutan is now onto a new phase in our aspirations in the area of energy production. The phenomenal surge in domestic consumption of electricity and the shift away from the traditional method of energy production and financing, tells me that we have encouraging future ahead of us. I hope we stay the course.

On a different note, I am happy that I have finally been able to deliver the promised gift of a complete set of bird photography camera gear for use by the students of Trashiyangtse Primary School – to vitalize their Birdwatching Club started by their teacher Lopon Tandin Wangdi.

The gift was made even more meaningful - by the fact that it was gifted on 2nd of May - a day celebrated in Bhutan as Teachers’ Day.

But I came back a worried man. The primary purpose of my trip was to deliver assistance to three little school girls in Trashiyangtse. It is not that they were found wanting in any way - they are all growing up to be healthy, responsible girls. But I can see that a situation is developing - quite naturally and normally - that has me worried for the future. It is a situational development that I cannot interfere with - it has to - and it will come to pass - as a natural progression of life. But in its passing, the disruption of life and living that it will cause - that is what is worrying me. Sadly, as of now, I am not prepared - rather, I am not sure how I should go about tackling the problem that is imminent.