The Bhutanese Leading the way.
Bhutan recorded 26,040 tourist arrivals in September 2026, up by 5,789 from the same month last year, but the impact on tourism businesses remains to be established
Bhutan recorded 26,040 tourist arrivals in September 2026, an increase of 5,789 compared with September 2025, according to the Department of Tourism’s Monthly Tourism Bulletin for September 2026. The increase represents growth of approximately 28.6 percent from the 20,251 arrivals recorded in September last year. However, the rise in visitor numbers alone does not establish whether tourism businesses have experienced higher earnings.
The key question is whether the increase in arrivals has translated into higher hotel occupancy, increased revenue and better business opportunities for hotels, tour operators, restaurants, transport providers and other businesses that depend on tourism.
According to the bulletin, Indian tourists accounted for 16,899 of the total arrivals in September, while visitors from countries other than India accounted for 9,141. Indian tourists, therefore, made up approximately 65 percent of total arrivals during the month.
The bulletin also recorded an average length of stay of four days for Indian tourists and five days for visitors from other countries. While these figures indicate visitor numbers and length of stay, they do not show how much tourists spent during their visits or how much revenue tourism businesses generated. The increase in arrivals therefore raises questions about whether the growth is translating into stronger business performance across the tourism sector.
Hotel occupancy rates, room prices and operating costs are among the factors that would help establish whether accommodation providers are benefiting from the increase. Changes in bookings and earnings would also help show whether tour operators, guides, restaurants and transport providers are experiencing greater demand. The impact may differ among businesses and locations.
Higher national arrival figures do not necessarily mean that all hotels and tourism-related businesses are receiving more customers or earning higher profits.
The owner of Hotel Ugyen in Olakha, Thimphu, said the hotel experienced a significant decline in room sales and revenue in September 2026 compared with the same month last year, despite the reported growth in tourist arrivals. The hotel sold 298 room-nights and earned Nu 834,900 in September 2025. In September 2026, room sales fell to 115 room-nights, generating revenue of Nu 322,200. This represents a 61.41 percent decline in both room sales and revenue, with monthly earnings falling by Nu 512,700 compared with September last year.
The owner said several factors could be contributing to the decline, including the distribution of tourists among different categories of accommodation, the cost of visiting Bhutan and limited business opportunities for smaller hotels.
“Despite reports of growth in tourist arrivals, our hotel has not experienced a corresponding increase in occupancy,” the owner said. Hotel Ugyen has 26 rooms, but its average daily room sales fell from approximately 9.9 rooms in September 2025 to 3.8 rooms in September 2026. Its occupancy rate also declined from 38.21 percent to 14.74 percent. The owner said the figures showed that an increase in overall tourist arrivals did not necessarily translate into increased business for every hotel, particularly smaller Bhutanese-owned properties.
The decline in occupancy has also placed pressure on the hotel’s finances, as operating expenses continue even when rooms remain vacant. Expenses such as staff salaries, electricity, heating, maintenance, food supplies, loan repayments and other essential costs must still be met despite the fall in revenue. With monthly revenue declining by Nu 512,700 compared with September 2025, the owner said maintaining service quality and meeting financial obligations had become increasingly challenging.
The hotel’s experience highlights the difference between growth in national tourist arrival figures and the performance of individual businesses. While overall arrivals may increase, the extent to which hotels benefit can vary. The owner said many tourists were price-conscious and carefully managed their travel budgets. The Sustainable Development Fee (SDF), accommodation, transport, guide services and other travel expenses all contribute to the overall cost of visiting Bhutan.
As a result, some visitors may choose accommodation that fits their budgets, while others may prefer higher-category hotels. The owner said more research was needed to understand how tourists distributed their spending across different accommodation categories and other tourism services. The owner said the biggest challenge was ensuring that tourist arrivals translated into fair and balanced business opportunities for small and medium-sized Bhutanese-owned hotels. Tourism policies and marketing efforts, the owner said, should benefit the wider hospitality industry rather than concentrate opportunities among a limited number of higher-category properties.
The owner called on the relevant authorities to review the challenges faced by smaller hotels, support international marketing and tourism expos, improve access to tour operators and travel agents, and ensure a fair and timely hotel classification and certification process. The owner also said the affordability of Bhutan as a tourist destination and the impact of tourism policies on local businesses should be considered. Tourism growth, the owner said, should not be measured by visitor arrivals alone, but also by how effectively its benefits reach Bhutanese-owned hotels, tour operators, restaurants, guides, drivers and the many families whose livelihoods depend on the sector.
The Chief Executive Officer of Dorji Drukyul Holidays said the increase in tourist arrivals had not translated into a corresponding rise in bookings and revenue for most Bhutanese tour operators. “Arrival numbers look encouraging on paper, but most Bhutanese tour operators are not seeing a matching rise in bookings or revenue compared with September last year,” the CEO said. The CEO said the tourism sector had struggled to recover since the COVID-19 pandemic, with many operators still facing difficulties and a large share of the growth in arrivals not reaching them.
The increase was mainly in visitor numbers rather than spending, the CEO said. Tourists were staying for shorter periods, booking more selectively and managing their expenses carefully.
“Rising arrivals do not automatically mean more income for local businesses, guides, drivers and communities,” the CEO said. On spending patterns, he said Indian visitors remained a large and important market, but many travelled independently or booked through operators across the border. As a result, much of their spending took place outside Bhutan, with limited benefits reaching Bhutanese tour operators.
The CEO said international tourists from other countries generally spent more per day and used local operators, guides and hotels. However, their numbers remained below what the industry needed. Rising operating costs, uncertain bookings, growing competition from operators outside Bhutan and frequent policy changes were among the major challenges facing the sector, the CEO said. These policy changes had created confusion for both overseas partners and local businesses.
“The irony is plain. Operators across the border are doing well from Bhutan tourism, while Bhutanese operators, who should benefit most, are falling behind,” he said.
Referring to the recent change in the name of the Ministry of Foreign Affairs following a structure that the CEO said had not worked and had caused confusion, the CEO called for a similar review of tourism policies. The CEO urged decision-makers to take immediate action, saying the industry could not afford further false hope.
“What we need is sensible, practical action that ensures Bhutanese people are the ones who benefit from this transformation,” the CEO said. Tourism revenue and visitor spending figures for September 2026, compared with the same month last year, would provide a clearer picture of the economic impact of the increase. Comparable hotel occupancy rates and average room prices would also help determine whether the rise in arrivals had translated into stronger performance for the accommodation sector.
The September bulletin provides evidence of growth in tourist arrivals, but further information on revenue, occupancy and business earnings is needed to assess whether the increase is delivering wider economic benefits. As Bhutan continues to attract visitors, the extent to which rising arrivals translate into sustainable earnings for tourism businesses remains an important measure of the sector’s performance.
