AGP Executive Report

IMF & LDC Graduation Lessons: IMF says Bhutan’s LDC graduation (2023) and other recent graduates haven’t shown automatic growth boosts, urging countries to plan for changing drivers rather than assume the past will repeat. Women in Agriculture & Energy: In Punakha, a solar-powered lift irrigation project under WERELIS is putting women operators at the centre, cutting hours of manual water hauling. Bhutan Growth Outlook: ADB projects Bhutan growth accelerating to 7.2% in 2027, with industry leading (electricity-driven) while agriculture stays weather-vulnerable. Gelephu Infrastructure Push: GMCA awarded the Gelephu International Airport airfield construction contract as earthworks near completion, while the Gelephu flood protection project is handed over to support safe expansion. Tourism & Hospitality: Seven Bhutan hotels will represent the country at the South Asian Travel Awards, aiming to raise service standards and visibility. Cordyceps Market Strain: Cordyceps auction 2026 saw 75.7% withdrawn after low bids, even as the sold quantity’s value rose to Nu 162.5m. Innovation & Business Readiness: Bhutan ranked 74th in the Global Innovation Index 2026, with officials focused on turning strengths like low-carbon energy and filmmaking into real business output. Health Ecosystem Deal: Druk Holding & Investments partnered with Tower Council Foundation to build a generational health research and innovation platform in Bhutan.

Energy & Trade Diplomacy: South Asian experts urged a regional energy trade partnership linking Bangladesh, India, Nepal and Bhutan to cushion supply shocks and high import prices amid geopolitical tensions. Gelephu Infrastructure: The Gelephu International Airport moved into its next phase as GMCA awarded the airfield construction contract, while the Gelephu Flood Protection Project was formally handed over to support safer city growth. Hydropower Industry: ANDRITZ won a contract to supply four turbine-generator units for Bhutan’s 600MW Khorlochhu project, reinforcing the country’s green power expansion. Innovation & Business Climate: Bhutan ranked 74th in the Global Innovation Index 2026, with officials stressing the need to turn strengths like low-carbon energy and filmmaking into real businesses and technology outputs. Tourism & Hospitality: Seven Bhutanese hotels will represent the country at the South Asian Travel Awards, aiming to boost regional visibility and service standards. Local Economy & Community: Trashigang’s mega archery tournament is funding a community hall through entry fees, while hotels and restaurants report extra visitors. Cordyceps Market: Bhutan’s Cordyceps Auction 2026 saw heavy withdrawals—only 73.02kg sold—highlighting collector pushback against low bids. Water & Agriculture: A Paro village in Tili faces worsening water shortages, drying up wetland cultivation and farm output. Health Sector Push: Druk Holding & Investments partnered with the Tower Council Foundation to build a generational health research and innovation ecosystem in Bhutan.

Gelephu Airport Build-Up: GMCA has awarded the next major construction contract for Gelephu International Airport as earthworks near completion, shifting focus to runway and permanent airfield infrastructure—aiming to connect Bhutan to the region without compromising safety and environmental standards. Gelephu Flood Safety: The Gelephu Flood Protection Project is now complete and handed over to Gelephu Mindfulness City, strengthening vulnerable river stretches ahead of rapid urban growth. Innovation Push: Bhutan improved to 74th in the Global Innovation Index 2026, with strengths in filmmaking and low-carbon energy, but officials warn the real task is turning innovation inputs into businesses and technology outputs. Tourism Exports: Seven Bhutanese hotels will represent the country at the South Asian Travel Awards in the Maldives, a bid to boost hospitality visibility and service upgrades. Health as an Industry: Druk Holding & Investments and the Tower Council Foundation are partnering to build a generational health ecosystem—research, clinical practice, data and innovation—opening new economic opportunities. Water & Farming Stress: In Tili (Paro), water shortages are drying up wetland farming and reducing cultivation, hitting daily life and rice output. Early Warning for GLOFs: Newcastle University research is modelling glacial lake outburst flood risks in Bhutan (Lunana/Thorthormi) using low-cost sensors and local knowledge to support earlier warnings. Thimphu Land Clarity: Hongtsho landowners are still waiting on decisions about the planned crematorium relocation, leaving property plans in limbo. Hydropower Equipment Deal: ANDRITZ won a contract to supply turbine-generator units for Bhutan’s Khorlochhu hydropower project, supporting the country’s green energy expansion.

UNGA 81 Diplomacy: South Asian states used the UN General Debate to push different priorities on climate justice, conflicts, AI sovereignty and UN reform, showing no single regional agenda. Tourism & Hospitality: Seven Bhutanese hotels will represent the country at the 10th South Asian Travel Awards in the Maldives, aiming to boost visibility and benchmark services after June evaluations. Innovation Push: Bhutan ranked 74th in the Global Innovation Index 2026, with officials stressing the need to convert strengths like filmmaking and low-carbon energy into real business and technology outputs. Gelephu Airport Build-Up: GMCA awarded the next airfield construction contract for Gelephu International Airport as earthworks near completion, shifting focus to runway and permanent infrastructure with quality and safety emphasis. UPI & Digital Finance Spillover: India’s UPI volumes jumped 27% to about 145 billion in H1 FY27, ahead of new merchant MDR rules from Oct 15—relevant for Bhutan’s digital payments ecosystem watch. Disaster Risk for Industry: Newcastle University research is modelling glacial lake outburst flood risks in Bhutan (Lunana/Thorthormi) and supporting early warning systems using low-cost sensors. Hydropower & Infrastructure Resilience: Gelephu flood protection works are completed and handed over, while ANDRITZ won a contract to supply turbine-generator units for Bhutan’s Khorlochhu hydropower project. Health as a New Sector: Druk Holding & Investments partnered with Tower Council Foundation to build a generational health ecosystem spanning research, clinical practice, data and innovation. Local Land & Water Pressures: Hongtsho landowners await clarity on a planned crematorium relocation, and Tili’s farms face worsening water shortages affecting daily life and cultivation.

UN Reform & Climate Justice: The 81st UN General Assembly wrapped in New York with South Asian states—including Bhutan—pushing different priorities on climate justice, conflict diplomacy, AI sovereignty and UN reform, underscoring how shared regional risks are handled through very different national lenses. GLOF Early Warning for Bhutan: Newcastle University research is modelling glacial lake outburst flood risks in Bhutan’s Lunana, using low-cost sensors and local knowledge to build hazard maps and early warning systems for communities near Thorthormi. Hydropower & Disaster Planning: Bhutan’s hydropower ecosystem stays in focus as regional flood impacts spur calls for reconstruction models for damaged projects, while Bhutan’s own hydropower supply chain gets a boost with ANDRITZ winning a contract for four turbine-generator units at Khorlochhu (600MW). Gelephu Flood Protection: Gelephu’s flood protection project is completed and handed over to Gelephu Mindfulness City, strengthening river stretches in Sarpang ahead of rapid urban growth. Local Land Uncertainty in Thimphu: Hongtsho landowners still await clarity on a planned crematorium relocation, leaving residents stuck on property decisions despite land acquisition and compensation steps. Water Stress in Paro (Tili): Tili village faces worsening water shortages affecting both daily life and farm output, with wetland cultivation shrinking due to unreliable spring-fed supply. Health as an Industry Opportunity: Druk Holding & Investments and Tower Council Foundation are partnering to build Bhutan’s “generational health” ecosystem—spanning research, clinical practice, data and innovation—to support a longer-term health-and-innovation economy. Digital Payments Watch (Regional): India’s UPI volume jumped 27% to about 145 billion in H1 FY27, with new merchant MDR rules set to start Oct 15—relevant for Bhutan’s regional fintech and payments discussions.

Digital Payments: UPI transactions in India jumped 27% to about 145 billion in volume in the first half of FY27, with value up 20% to Rs 177 lakh crore, ahead of new merchant discount rate (MDR) rules for high-value payments. Disaster Resilience & Infrastructure: Gelephu’s flood protection project is completed and handed over to Gelephu Mindfulness City, protecting vulnerable river stretches as the city gears up for rapid growth. Water & Agriculture: A water shortage in Tili village, Paro is drying up wetland farming and daily life, cutting cultivated acreage and hitting paddy cycles. Health as an Industry: Druk Holding & Investments is partnering with the US Tower Council Foundation to build a “generational health” research and innovation ecosystem, spanning diagnostics, regenerative medicine, and mental health. Land & Public Services: In Thimphu’s Hongtsho, landowners are still waiting for clarity on a planned crematorium relocation, leaving property decisions in limbo. Hydropower Engineering: ANDRITZ won a contract to supply turbine-generator units for Bhutan’s 600MW Khorlochhu project, supporting the country’s green power expansion. Regional Tech & Services: Japan has listed Bhutan among 17 countries approved for its Technical Intern Training Programme, signaling continued skills and workforce links.

Hydropower Contract: ANDRITZ won a contract to supply four Pelton turbine-generator units for Bhutan’s 600MW Khorlochhu hydropower project in Trashiyangtse, with design, manufacture, supply, installation, testing and commissioning planned via its India facilities. Energy Tech for Industry: DrukSmart TALKS 2026 highlighted how Industrial AI, digital twins and predictive intelligence can shift Bhutan’s hydropower operations from reactive monitoring to predictive maintenance and better water-demand planning. Digital Finance in Bhutan: BTSE Bhutan received a Financial Services License for Gelephu Mindfulness City, enabling regulated virtual-asset trading and institutional-grade custody, with spot trading starting for BTC/USDT and ETH/USDT. Regional Connectivity & Security: India’s “Siliguri Corridor” push aims to reduce disruption risk to the Northeast using underground infrastructure, added rail capacity, alternative highways and border roads. AI Collaboration: Project Tapestry reported progress on sovereign AI “consortium training” and expanded partnerships with Vietnam and India during UN General Assembly week. Public Health & Industry: WHO recognized Bhutan for eliminating dog-transmitted human rabies as a public health problem, supporting the country’s One Health systems. Trade & Manufacturing Linkages: Singari Industries signed MoUs worth over ₹201 crore with buyers from 15 countries at UPITS-2026, including Bhutan.

Hydropower & Industry Contracts: ANDRITZ won a contract to supply four Pelton turbine-generator units for Bhutan’s 600MW Khorlochhu hydropower project in Trashiyangtse, supporting the country’s green power expansion. Energy AI for Operations: DrukSmart showcased Industrial AI, Digital Twins and predictive intelligence for hydropower and grid assets, aiming to shift Bhutan’s energy maintenance from reactive to predictive. Digital Health Investment: TOWER Council Foundation and Druk Holding & Investments (DHI) partnered to build Bhutan’s Generational Health ecosystem, linking research, clinical practice, data and innovation. AI Ecosystem Expansion: Project Tapestry reported progress on sovereign AI “consortium training” and expanded collaborations with Vietnam and India during UN General Assembly Week. Mining & Flood Risk Watch: Reports highlight China’s glacier-adjacent mining as a growing Himalayan flood risk, with potential downstream impacts for the region including Bhutan. Trade & Skills Angle: Coverage also points to Bhutan’s ICT industry hurdles—skills, financing and red tape—while Bhutan continues to be recognized for public health progress, including WHO validation of dog-transmitted rabies elimination.

Energy & Industry Resilience: Bhutan’s DrukSmart showcased how Industrial AI, digital twins and predictive intelligence can shift hydropower operations from reactive maintenance to earlier fault detection and better water-demand planning. Hydropower Recovery Planning: Nepal is moving to reconstruct flood-damaged hydropower after the Aug 26 Bhotekoshi disaster and later rains/landslides, with damage data collection and financial/regulatory models underway. Digital Finance in Bhutan: BTSE Bhutan received a Financial Services License for regulated virtual-asset trading and institutional custody in Gelephu Mindfulness City, with spot trading starting soon. AI for Sovereign Collaboration: Project Tapestry reported its first “consortium training” milestone and expanded sovereign AI work with Vietnam and India during UNGA week. Trade & Manufacturing Links: Singari Industries signed MoUs worth over ₹201 crore with 15 countries at UPITS-2026, highlighting Bhutan among buyer discussions. Regional Security Cooperation: India hosted BIMSTEC talks on counter-terrorism and transnational crime with Bhutan in attendance. Public Health Milestone: WHO recognized Bhutan for eliminating dog-transmitted human rabies as a public health problem, reinforcing its One Health approach. Tourism & Local Industry: Bhutan announced the Black Mountain festival in Trongsa (Oct 2-4), with local products, CSI/cottage industries and community-led experiences.

Bhutan Energy & Industry Tech: DrukSmart Talks 2026 highlighted how Industrial AI, digital twins and predictive intelligence can help Bhutan’s hydropower operators move from reactive maintenance to earlier fault and water-demand forecasting. Digital Finance in Bhutan: BTSE Bhutan received a Financial Services License for regulated virtual-asset trading and institutional custody in Gelephu Mindfulness City, with spot trading set to start soon (BTC/USDT, ETH/USDT). Tourism & Local Enterprise: Bhutan’s Black Mountain festival (Trongsa, Oct 2–4) will expand via a highway activation and spotlight local products, cottage and small industry, crafts, and community experiences. Regional Trade & Manufacturing Links: Singari Industries signed MoUs worth over ₹201 crore with buyers from 15 countries at UPITS-2026, including Bhutan, showcasing air coolers and washing machines. Health & Workforce Mobility: WHO certified Bhutan as dog-transmitted rabies-free, while Japan published a 17-country list for its technical intern training programme that includes Bhutan.

AI for Industry: DrukSmart Talks 2026 explored how Industrial AI, digital twins and predictive intelligence can help Bhutan’s hydropower operators shift from reactive maintenance to predictive decision-making. Digital Finance in Bhutan: BTSE Bhutan received a Financial Services License from Gelephu’s regulator to run a regulated virtual-asset trading venue and institutional custody, with spot trading starting for BTC/USDT and ETH/USDT. Public Health Milestone: WHO recognized Bhutan for eliminating dog-transmitted human rabies as a public health problem, with zero deaths since June 2023 under a One Health approach. Trade & Manufacturing Linkages: Singari Industries signed MoUs worth over ₹201 crore with 15 countries at UPITS-2026, showcasing air coolers and washing machines and holding 50+ B2B meetings including with Bhutan. Regional Security Cooperation: India hosted the 11th BIMSTEC counter-terrorism and transnational crime working group meeting with Bhutan and others, focusing on trafficking, illicit drugs, money laundering and legal cooperation. Infrastructure & Procurement: Bhutan Broadcasting Service Corporation re-invited quotations for shelters, towers, fencing, and earthling, AC and ventilation installation/testing/commissioning.

Bhutan’s Energy Tech: DrukSmart Talks 2026 highlighted how Industrial AI, digital twins and predictive intelligence can shift Bhutan’s hydropower operations from reactive monitoring to predictive maintenance and smarter water-demand planning. Digital Finance in Bhutan: BTSE Bhutan received a Financial Services License for regulated virtual-asset trading and institutional custody in Gelephu Mindfulness City, with spot trading set to start for BTC/USDT and ETH/USDT. Public Health Milestone: WHO validated Bhutan as having eliminated dog-transmitted human rabies as a public health problem, with zero dog-mediated human deaths since June 2023 under a One Health programme. Tourism & Local Industry: Bhutan’s Black Mountain festival (Oct 2-4, Trongsa) will expand along the highway corridor, spotlighting local produce, cottage and small industries, crafts, and community-led experiences. Regional Security & Trade: Bhutan joined BIMSTEC counter-terrorism talks in New Delhi, while the week also saw cross-border logistics and preparedness discussions tied to Himalayan disaster risks. Food & Services: Thimphu’s first ramen shop, Hayate Ramen, marked its 10th anniversary—an example of how niche food businesses can thrive despite high-altitude constraints.

Digital Finance in Gelephu: BTSE Bhutan received a Financial Services License from the Gelephu Financial Services Office, enabling regulated virtual-asset trading (spot BTC/USDT and ETH/USDT first) and institutional custody, with onboarding starting soon. Public Health & One Health: WHO validated Bhutan’s elimination of dog-transmitted human rabies as a public health problem, with zero deaths since June 2023, ahead of World Rabies Day. Aviation & Connectivity Spotlight: India’s LGBI Airport in Guwahati highlighted its “Bamboo Orchids” integrated terminal and sustainability-focused design after being named among the world’s most beautiful airports. Energy & Climate Resilience Diplomacy: Bhutan and EU parliamentarians discussed climate, energy and development, while regional leaders push Himalayan resilience and adaptation finance after major floods. ICT Industry Bottleneck: A report flags a gap between Bhutan’s ICT policy ambitions and on-the-ground implementation, leaving the domestic tech ecosystem stagnant. Food Supply Pressure: Bhutan’s agriculture report notes thousands of tonnes of crops lost to climate impacts, pests, and human-wildlife conflict, even as production rises. Tourism & Local Economy: Bhutan’s Black Mountain festival (Oct 2–4) will expand along the Trongsa highway corridor, featuring local produce, CSI products, crafts and community experiences. Business Growth Goal: Government targets at least two home-grown enterprises reaching USD 50M+ valuation by 2030, but points to finance and scaling constraints.

Bhutan’s Rabies Milestone: Bhutan has been WHO-certified as having eradicated dog-transmitted rabies, with no human deaths since June 2023, driven by a “One Health” push that mobilised vets, health workers, local bodies and communities. Trade & Logistics Upgrade: Bhutan’s Mega Dry Port in Pasakha is completed and ready for operations, aiming to streamline customs and cargo clearance, cut pressure on Phuentshogling, and handle up to 100 truckloads a day. ICT & Entrepreneurship Push: Bhutan is drafting a National Entrepreneurship Strategy 2026 to help at least two home-grown enterprises reach over USD 50M valuation by 2030, while a separate report flags hurdles in implementing ICT policy. Food Supply Strain: Bhutan’s agriculture report shows thousands of tonnes of paddy, fruits and vegetables lost to climate impacts, pests/diseases and human-wildlife conflict, even as production rises. Public Procurement: Bhutan Broadcasting Service Corporation re-tenders works for shelters, towers, fencing and earthling, AC and ventilation systems. Tourism & Local Industry: The Black Mountain festival returns in Trongsa (Oct 2-4), with highway-corridor activation and local products, crafts and CSI support. Global Sustainability Spotlight: The Zayed Sustainability Prize named 2027 finalists after a record 10,233 entries, with Bhutan’s broader ecosystem watching innovation in health, food, energy, water and climate action.

Bhutan-EU Cooperation: Bhutan and European Parliamentarians met in Bhutan to discuss climate resilience, renewable energy, education and digital transformation, with Bhutan pushing for more adaptation finance and resilient infrastructure. Trade & Logistics Upgrade: Bhutan’s Mega Dry Port in Pasakha is completed and ready for operations, aiming to centralize customs, revenue, BFDA, police and clearing agents, cut congestion at Phuentshogling and handle up to 100 truckloads a day with warehouses, container yards and cold storage. Digital Payments for Business: UPI is now accepted in 11 countries including Bhutan, as India prepares a new merchant MDR from Oct 15, raising questions on how charges may apply to overseas markets. Entrepreneurship Push: Government targets at least two home-grown enterprises reaching USD 50M valuation by 2030 under the National Entrepreneurship Strategy 2026, but finance and scaling constraints remain key hurdles. Food Supply Pressure: Bhutan’s agriculture report flags thousands of tonnes of paddy, fruits and vegetables lost to climate impacts, pests, diseases and human-wildlife conflict, underlining the need to protect crops after production. Public Procurement Call: Bhutan Broadcasting Service Corporation re-invites quotations for shelters, towers, fencing and earthling, AC and ventilation installation/testing/commissioning.

Bhutan-EU Cooperation: Bhutan and European Parliamentarians met in Bhutan to discuss climate resilience, renewable energy, education and digital transformation, with Bhutan pushing for adaptation finance and resilient infrastructure. Ecosystem Accounting Push: Bhutan became the first country to adopt Gross Ecosystem Product nationally, valuing ecosystem services at about US$6.2bn for 2024 alongside GDP and Gross National Happiness. Trade Logistics Upgrade: The Mega Dry Port in Pasakha is completed and set to begin operations, aiming to streamline cargo clearance, reduce pressure on Phuentshogling, and consolidate customs, BFDA, police and clearing agents under one roof. ICT Industry Bottlenecks: A look at Bhutan’s ICT sector highlights the gap between policy ambition and implementation, with skills, financing and red tape still holding back growth. Entrepreneurship Targets: Government plans to back at least two home-grown enterprises to reach over USD 50m valuation by 2030, but finance and sector selection remain major hurdles. Food Losses Despite Output: Bhutan’s agriculture report flags thousands of tonnes of paddy, fruits and vegetables lost to climate impacts, pests/diseases and human-wildlife conflict, undermining the push for more domestic food.