Bhutan’s economy is expected to grow faster than many other South Asian countries this year. A new United Nations report says the country is on track to record strong economic growth, supported mainly by tourism, agriculture, and government spending. According to the UN World Economic Situation and Prospects 2026 report, Bhutan’s GDP is projected to grow by 6.5 per cent this year, higher than the South Asian average of 5.6 per cent.
The report says Bhutan’s growth is being driven by strong government spending and the gradual recovery of tourism and agriculture.
Growth is expected to stay above 6 per cent, with the economy projected to expand by 6.1 per cent next year.
Compared with other South Asian countries, Bhutan’s projected growth rate puts it ahead of Bangladesh, the Maldives, Nepal, Sri Lanka, and Pakistan.
Another area where Bhutan stands out is price stability. While inflation in parts of South Asia is forecast to rise sharply, reaching as high as 35 per cent in some neighbouring economies, Bhutan’s inflation is expected to remain manageable at 3.5 per cent this year.
However, the report also points out that as a lower-middle-income country, Bhutan remains at moderate risk of debt distress. It says the government will need to carefully manage spending and debt to ensure that economic growth can continue in the long term.
As Bhutan moves through 2026, steady growth and controlled inflation provide a stable economic outlook. However, balancing continued public spending with long-term debt management will be critical to sustaining this momentum in the years ahead.
Kinley Bidha
Edited by Phub Gyem
