Bhutan’s Digital Economy Developmentand Transformation Strategy

The Digital Economy Development and Transformation Strategy, formulated by the Royal Government of Bhutan (RGoB), aims to position the nation as a technologically advanced society with empowered citizens and a flourishing digital economy. This policy is an integral part of Bhutan’s 13th Five-Year Plan (FYP) for 2023–2028 and serves as a roadmap for transitioning into a knowledge-based economy. The strategy builds upon past successes and introduces new mechanisms for sustainable growth by leveraging digital technologies.

The policy’s primary purpose is to develop Bhutan’s ICT infrastructure, enhance digital government services, and foster a vibrant private sector ecosystem. Its scope extends across government, private enterprises, and citizens, ensuring inclusivity and equitable access to digital tools and resources. The strategy envisions addressing existing gaps in infrastructure, capacity, and governance while introducing reforms to attract investments, create jobs, and modernise the economy.

The strategy is structured around six thematic pillars:

• Digital infrastructure development
• Digital government development
• Private sector development and enabling business environment
• Digital financial services development
• People and skills development
• Governance, institutional arrangements, and legal reforms

Digital infrastructure development

This pillar addresses the need for a reliable, robust, and affordable digital infrastructure. The strategy emphasises developing Bhutan’s fibre-optic networks and securing an additional international internet gateway to ensure uninterrupted connectivity. The scope also includes exploring innovative technologies, such as low-earth orbit satellite systems, to provide internet access to remote and underserved regions.

An important component is the adoption of private cloud services for non-sensitive government and private sector data. This approach seeks to reduce storage costs, enhance data accessibility, and ensure scalability. The policy also stresses developing cybersecurity measures to protect critical data.

Digital government development

The digital government development policy focuses on creating a seamless and integrated e-governance ecosystem. Its primary goal is to streamline public service delivery, enhance data-driven decision-making, and foster transparency in governance. This involves consolidating over 400 siloed government data platforms into a centralised ‘single source of truth’ (SSOT) system.

The policy outlines measures to strengthen the executive information system (EIS) and integrate digital financial management systems to improve the tracking of expenditures and revenues. A key component is the digitization of government services to improve accessibility for all citizens, particularly those in rural areas.

Private sector development and enabling business environment

The strategy highlights the critical role of the private sector in driving innovation and economic growth. By creating a conducive regulatory and business environment, the policy aims to promote tech entrepreneurship and attract foreign direct investment (FDI). Initiatives include offering tax incentives for ICT companies, facilitating the import of advanced technology, and developing tech hubs such as the Thimphu Tech Park.

To foster innovation, the policy proposes increased collaboration between academic institutions and private enterprises. By linking industry demands with educational curriculums, Bhutan seeks to ensure a steady supply of skilled professionals for the digital economy.

Digital financial services development

This component seeks to integrate financial technologies to support a cashless economy and promote financial inclusion. The policy underscores the development of secure payment gateways, QR code-based payment systems, and fintech solutions to enable seamless financial transactions. This approach is particularly geared toward fostering cross-border trade, enhancing digital businesses, and supporting Bhutan’s aspirations as a hub for remote and freelance work.

People and skills development

The people and skills development policy is designed to address Bhutan’s human resource challenges in the ICT sector. It emphasises capacity development through structured training programs, curriculum revisions in schools and universities, and vocational courses in emerging technologies like artificial intelligence, machine learning, and blockchain.

Efforts are also directed toward bridging the digital divide. This includes enhancing digital literacy in rural areas through community service centers and offering nationwide digital awareness campaigns. Programs like CodeMonkey, introduced in schools, aim to foster computational thinking and prepare students for technology-driven careers.

Governance, institutional arrangements, and legal reforms

The policy framework recognises the need for a robust legal and institutional structure to support digital transformation. This includes revising outdated ICT laws, such as the Bhutan Information, Communications, and Media Act of 2018, to address emerging issues like data privacy and cybersecurity.

GovTech, the central agency for ICT development, plays a pivotal role in implementing this strategy. It is tasked with ensuring that laws and policies align with international best practices while addressing Bhutan’s unique socioeconomic and cultural contexts.

The strategy also highlights the importance of fostering public-private partnerships, ensuring efficient data sharing between agencies, and promoting a culture of accountability in governance.