The Bhutanese Leading the way.
No SDF duration discount
According to the latest figures, Bhutan has crossed the 200,000 tourists figure mark in 2025.
This is compared to 145,065 tourists in 2024 which is an increase of around 55,000 tourists in 2025. This is also compared to 103,066 tourists in 2023.
Until November 2025, the total number of tourists that visited was 182,556 tourists while though the exact numbers are not yet out the visitor numbers in December are around 18,000 taking the total to just above 200,000 tourists.
The long term target was to achieve around 300,000 tourists by 2027 which will be closer to the peak pre-pandemic 2019 number of 315,599 tourists, though the Minister for Industry, Commerce and Employment Namgyal Dorji last year said the aim is to achieve 300,000 tourists by 2026 itself.
The Department of Tourism target for the financial year from July 2025 to June 2026 is an ambitious 250,000 tourists and of this the numbers achieved in the first six months of this fiscal year is just above 90,000 tourists. This would mean attracting another 160,000 tourists in another six months.
The targets above will all be tall tasks, especially since it is now clear that the government, for now, will not be granting the duration discount which was expected to increase the numbers and the nights stayed.
In the earlier pre-pandemic system, after the 9th night, tourists got a 50 percent SDF discount, and after the 15th night it was a 100 percent SDF discount.
There was also a group discount which meant that if there is a pac of 10 tourists then one of them or the tour leader would get a 50 percent discount on SDF by the old TCB.
More than a year ago MoICE asked the Bhutan Innovation Lab (BIL) office under the Prime Minister’s Office (PMO) to study the issue of duration discount, group discount and other tourism related issues.
BIL submitted its report to MoICE, and the final recommendation from MoICE was waiver of SDF for tourists paying in USD from the 7th night onwards, 50 percent SDF waiver for one person in a group of 6-12 tourists and full SDF waiver of one person in a group of 13-16 tourists.
The matter went to the Cabinet where in the absence of the Prime Minister (PM) Dasho Tshering Tobgay, the Cabinet approved the above proposal. However, it was retracted later when the PM came back on his instructions.
A source said the PM was concerned that such a discount was creating loopholes all over the place when the stated policy is ‘High Value and Low Volume,’ and so such a discount would undermine that policy.
The source said the PM felt that different kinds of waivers to the SDF had been requested and if this is agreed to then there would be no end to the requests for waivers.
It was felt that instead of attacking the SDF there should be more focus on marketing and improving the quality of services.
The source said the PM felt that enhanced marketing by leveraging high value and low volume could be used to reach the 300,000 tourists target.
One main argument among officials against duration discounts has been that higher end resorts and hotels have been doing booming business, and so the issue is being seen as an inability to market or tap into this segment of tourists by the rest.
The tourism industry has been pointing to the increasing dominance of Bhutan’s tourism sector by Indian tour operators, but here too, the official stance is that the Bhutanese tourism sector needs to work harder and do more and better marketing to get the tourists themselves.
Tourism industry insiders say that while the numbers are increasing, the money earned per tourist has gone down dramatically.
They say that prior to the pandemic, Indian tourists stayed an average of 6 nights while European and American tourists stayed around 7 nights.
As per the latest Tourism Monitor Report for November 2025, the number of nights stayed has reduced to 4 nights for Indian tourists and it is 5 nights for countries other than India. This means that both Indian and other tourists on an average are spending two lesser nights in Bhutan.
Local tour operators also point to the increasingly cheap packages being offered by tour operators in Jaigaon where a stay for 4 nights and 5 days are being sold at around Nu 15,000 per person inclusive of the Nu 1,200 SDF per day, three star hotel stay, tour guide, breakfast and dinner and tourist sim card.
They say that Bhutan is getting the worst of both worlds, with a combination of lower numbers of tourists with even lower rates per tourist which is eating into the margins of local hotels, guides etc and the little profit being made is increasingly taken across the border.
In Jaigaon, the allegation is that tour operators there buy the Ngultrums from local traders at a reduced discount and then use it to pay hotels, guides, etc., in Bhutan. This has also led to a thriving Ngultrum-INR business where the former is devalued adding to the profit margin of tour operators across the border. This also ensures that Bhutanese tour operators simply cannot compete with the ultra-low rates being given across the border.
Going ahead, the plan to improve numbers by the government is doing more marketing, developing more tourism products, having more events, festivals and improving the payment gateway. The hope is that Samdrupjongkhar entry and exit being allowed will improve tourism numbers in eastern Bhutan.
