Cheaper than many mass tourism sites in India the added incentive for Bhutan is being a cheap foreign destination along with Kathmandu
Bhutan has been groaning for a while now with the explosion in the number of regional tourists, with their numbers going from 50,722 regional tourists in 2012 to 202,290 regional tourists in 2018.
It now emerges that one major reason for this regional tourism explosion is the massive promotion of Bhutan as a cheap or affordable destination by a large number of Indian tour companies.
Some of them across the border in Jaigaon are promoting Bhutan at a cost of Nu 999 a day inclusive of hotel, vehicles, breakfast and sightseeing.
There are tourists who have written blogs on tourism sites of having enjoyed a trip to Bhutan at Nu 1,000 a day inclusive of hotel, travel and food.
This is much lower than even mass tourism destinations in India like Darjeeling, Kalimpong, Sikkim, Goa etc.
A major national daily of India Economic Times on its 22nd April issue gave a list of nine affordable destinations in India featuring mainly mass tourist domestic destinations in India like Goa, Rishikesh and Haridwar, Gokarna, Munnar, McLeodganj, Coorg and Meghalaya for three nights and four days.
However, given the affordability factor Bhutan was added in the list along with Kathmandu and Pokhara as an affordable destination.
While all the other destinations were for three days and four nights, Bhutan gave four nights and five days for a hotel cost of Nu 8,800, travel of 4,500, food for 4,500, activities for 1,500 coming to a total of 18,800.
While on one hand Bhutan has been promoting itself as a ‘high value and low impact’ tourist destination with an ‘exclusivity factor’ in the west, the Indian newspaper’s listing is only a reflection of the massive mass marketing of Bhutan as another Goa or Darjeeling by Indian tour companies in India.
The added attraction is of Bhutan being a foreign country where Indians do not need to get a visa.
One of India’s most popular current affairs website quora.com hosts an article by two Indian tourists who say that Bhutan is the cheapest international destination for an Indian. It says that a five-day trip to Bhutan can easily be done at Nu 4,500-Nu 5,000. The article is titled “How much does it cost to travel to Bhutan from India.”
This 2018 article by the duo says that a hotel in Phuentsholing cost them 200 per person, in Thimphu it was 300 per person and in Paro it was 400 per person. It says food is around 300 per person per day.
These online packages and articles are important because according to the 2018 Bhutan Tourism Monitor report by TCB, 73.31 percent of tourists that came to Bhutan had heard about Bhutan through online sources.
The four channels of mass tourism
The promotion of Bhutan as an affordable mass tourism destination for Indians is happening at four levels.
One is major and big tour companies in India like Yatra.com, Expedia, Make My Trip etc which normally sells mass packaged tours to Bhutan equivalent to mass destinations in India, mentioned in the Indian news article. Yatra.com offers a four day and five-night trip to Bhutan for Nu 19,000 for lodging, transport and food.
There are then the smaller operators across the border in Jaigaon and Siliguri who sell Bhutan at even lower rates. Jaigaon already has more than 30 Bhutan specific tour operators and two tour associations.
One of them on a Bhutan Tourism facebook page was offering packaged tours to Bhutan at Nu 999 a day mentioned above.
The third level is again a large number of tourists who come by themselves without any tour package or guides. Here such a tourist wrote a popular article on offbeatexplorers.com a travel site on how he and his partner enjoyed Bhutan at Nu 1,000 a day giving tips to others like him. He helpfully writes that this option is also available for those from Bangladesh and Maldives.
Another blog on Lonely Planet’s website titled ‘Budget travel from India to Bhutan,’ has an Indian tourist boasting of a low budget travel to Bhutan which in part was possible due to bargaining with hotels here. The blog is recommended for Indians wanting to make a ‘budget international trip’.
The fourth way is a few of Bhutan’s own tour operators and guides who receive and take these tourists. An article on tripto.com- a travel website also has an article by a young Indian lady titled ‘Budget Trip to Blissful Bhutan,’ that not only underscores how cheap and easy it is to visit Bhutan but she had a Bhutanese tour guide to receive and help her.
The issue is not only cost but also the relatively easy entry into Bhutan even without the required identification documents.
The popular tripadvisor.com says that one does not need a passport while coming to Bhutan and a voter ID is enough. It also says that even if someone does not bring a voter ID the Indian Consulate office in Phuentsholing will provide an ‘identification slip’ to enter Bhutan if one has other documents.
The Lonely planet website informs foreign tourists that only Indian tourists can plan their own tour budget.
Another travel website bhutanitis.com says that those driving their own vehicles can get in with a permit from the RSTA.
What is worse is that while Bhutan has always distinguished itself as a more high-end or expensive destination compared to neighboring Darjeeling, the reality is quite something else when it comes to pricing.
The Chairman of the Guides Association of Bhutan (GAB) Garab Dorji who recently visited Darjeeling said, “During the season in Darjeeling, hotels which are worth 2,000 stick to the rate and do not budge because they have a syndicate among hotels where the minimum price is fixed.”
In the case of Bhutan, Garab said that it is well known that regional tourists can bargain down to very low rates.
“I have heard of cases where even budget hotels have lost their guests to three star rated hotels who reduced their prices by huge amounts for regional tourists,” said Garab.
An article on tourmyindia.com says that hotels in Thimphu can be had for as low as Nu 400 to 500 a day.
The GAB Chairman and his counterpart in ABTO in the form of its Executive Director, Sonam Dorji both said that the Indian tour companies block large numbers of hotels rooms in Bhutan through large parts of the year at very low rates.
They said that since hotels are worried about occupancy they have no problems in essentially renting out rooms to large tour operators at very low rates. The Indian tour operators may use only 50 percent of the rooms but they pay for the rest of the 50 percent blocked rooms too from the 50 percent tourists using the discounted rooms.
Garab said that even high end hotels in Thimphu have essentially rented out entire rooms and hotels to tour operators in Jaigaon and Siliguri at very low rates. This ensures occupancy but at much reduced rates.
ABTO and GAB complained that this policy of the hotels is affecting the tariff paying tourists as rooms are not made available. The two associations also worry that this rock bottom pricing policy of hotels is making Bhutan cheaper and hence more attractive for mass tourism.
The same hotels, however, refuse to give similar discounts to the smaller Bhutanese tour operators and in fact demand cash upfront. The hotels in the past past have cited late payments and at times non-payment by Bhutanese tour operators.
Sonam pointed out that since regional tourists pay in cash there can also be cases of hotels avoiding paying tax unlike in the case of tariff paying tourists where payments are made in cheque and everything is accounted.
Garab said that the minimum a three-star hotel should be charging is Nu 3,000 per night but hotel rooms are blocked for regional tourists at rates as low as Nu 1,500 and even lower.
Meanwhile, the Chairman of the Hotel and Restaurant Association of Bhutan (HRAB) Sonam Wangchuk claimed that the hotels already have a basic cost of operation which is around 1,500 to Nu 2,000 per room for budget hotels and even higher for three star hotels.
He claimed that hotels are not providing cheap accommodation but he instead laid the blamed on unlicensed Airbnb accommodations and also apartments being let out as hotel rooms.
HRAB found 144 properties listed in Thimphu as Airbnb and while some were hotels many were apartments and bungalows.
The HRAB Chairman said that an entire bungalow was being given for 3,000 a night and when divided this can come to 500 per room.
He said this is also adding to the housing crisis in Thimphu as the middle class and lower middle class cannot find accommodations which are being let out to tourists.
Bhutan becoming a mass tourism destination
The dramatic increase in the numbers and the end result of all the above is that Bhutan is now at the cusp of turning into a mass tourist destination like a Goa, Darjeeling or Kathmandu.
For many Bhutanese, this poses a question over not only the tourism industry but also the impact on Bhutanese society, environment, waste management, limited water resources, land prices, housing, culture and more.
GAB, ABTO and the Tourism Council of Bhutan (TCB) are all concerned with Bhutan turning into a mass tourism destination.
The GAB Chairman and ABTO Executive Director, both said that if nothing is done soon then Bhutan is headed on its way to lose its exclusivity factor and become like any other mass tourism destination in India.
Sonam Dorji acknowledged that the promotion of Bhutan as a mass destination in India is a problem- as it puts Bhutan at par with Indian hill stations. He said this also goes beyond tourism and compromises the Bhutanese identity.
Both of them, speaking on behalf of their associations, also said mass regional tourism is already affecting tourism operations in Bhutan- making it a low cost destination.
Sonam Dorji pointed out that for a while hotels had been saying that regional tourists spend as much and even more than dollars paying tourists. The implication being that tariff tourists don’t spend much beyond the package rate.
However, he said that in addition to the USD 65 per day that goes to the government and the USD 250 package the 2018 Tourism Monitor Report found that tariff paying tourists spent additional amount on food and drinks and souvenirs beyond the package.
Sonam Dorji said that USD 250 is the minimum and there are tariff paying tourists who go up to USD 1,500 a night.
He reiterated that in terms of package, USD 65 to the government, taxation and additional amounts spent- tariff paying tourists contribute far more than regional tourists to the Bhutanese economy.
The ABTO ED said that regional tourists in large numbers is leading to crowding out of tourism sites in Bhutan and there is a pressure on Bhutan’s limited infrastructure and on its culture and society.
The GAB Chairman said that apart form losing the exclusivity factor Bhutan would start to look like any other mass tourist destination.
Garab said that such a large influx of regional tourists also touches upon the sovereignty and security of the country.
He said there will come a time when regional tourists will outnumber Bhutanese and it is already starting to happen.
“It is not just about money. I want to hand over the same Bhutan to my children that I enjoyed, but it will not be possible with mass regional tourism,” said Garab.
With the size and scope of the problem clear, all stakeholders agreed that there are urgent steps required to deal with the issue.
The TCB DG Dorji Dhradhul said that he had also seen the Economic Times listing of Bhutan and said it is a serious issue. The DG said that the main strategy to tackle this issue is to come up with regulations within Bhutan.
The DG said that the TCB is working on a slew of measures which will be presented to the next Council meeting in June.
The DG said that currently it is only compulsory for tariff paying tourists to stay in TCB certified hotels, which are three stars and above.
He said that the new regulation could introduce rating systems even for budget tourists to improve their standards and only those hotels could keep regional tourists.
The DG said that the TCB is also looking at the Pay Commission’s proposals of Nu 500 SDF free for regional tourists.
The DG said that green tax for vehicles entering Bhutan would also be considered, as well as the need to follow Bhutanese laws on carrying capacity for vehicles. Bhutanese regulations only allow 5 passengers in most vehicles given the mountainous territory.
The ABTO ED said that regulations are needed and one of them has to be SDF fees for regional tourists. He said that Indian vehicles can also be asked to pay toll fees.
The ED said that hotels should be standardized, especially given that Bhutan is an earthquake prone zone and this should be backed with strong monitoring.
Sonam Dorji also said that internationally hotels only have a leeway to give highly discounted rates on 10 percent of the rooms but in Bhutan without such a regulation huge discounts were being given to big India based tour companies who used volumes to their advantage.
He said that regional tourists should come through Bhutanese tour operators and guides.
The GAB Chairman also supported the idea of an SDF fee. In terms of vehicles he said that within India itself when vehicles mover from one state to another there were fees collected and in some tourist areas only local cars and taxis were allowed to avoid congestion.
Garab said that one main is the oversupply of Hotels and rooms due to the Fiscal Incentives granted to the hotels since 2010. He said it is time for the government to reconsider this fiscal incentive and give it only to areas in the east and south where hotels are actually needed. He also said that the hotel industry should think beyond itself.
The HRAB Chairman Sonam Wangchuk in contrast said that the SDF of 500 per day would kill the tourism industry. He said that instead a one-time Nu 300 fee can be charged.
He said that one problem is when 274,097 tourists come in through Phuentsholing and Paro and go to the same places in the west, it is seen as mass tourism. He said that areas in the south and east could be opened up to spread the flow.
He said RSTA already has existing regulations which say that foreign registered cars cannot cater to to tourists and so RSTA must enforce such rules.