Foreign direct investment and its impact on development path of Bhutan

Abstract

Gross National Happiness, a valued concept originated in tiny Himalayan Kingdom of Bhutan was first enunciated by His Majesty the Fourth King Jigme SIngye Wangchuck in the year 1972. This concept has now become a globalized concept. Bhutan today is deeply rooted in diligently introducing the strategic framework in balancing development between its spirituality and materialism in this rapidly growing economy. As GNH has travelled across the globe, so is Bhutan, now ready to integrate in the global community as well. This research tried to study the implications that Bhutan would face if to integrate with global economy by opening its economy to Foreign Direct Investment. In understanding the implications of FDI on development philosophy of Bhutan, questionnaires were used as the main research mechanism by distributing to over 450 respondents in three places in Bhutan, namely, Paro, Thimphu and Phuenstsholing respectively. The data obtained were then analyzed in SPSS window version 16.0. The results obtained were summarized in frequency, percentage, mean, standard deviation. Chi square test is conducted as part of statistical test. This study concludes that FDI would positively assist sustainable economic development and good governance, while it might not be of serious threat to culture and natural environment. Good governance is viewed as the most important pillar for GNH as expressed by majority of the respondents. Hence FDI in Bhutan is expected to bring in positive impact on GNH. FDI in Bhutan is still at nascent stage, hence its implication can not be determined now nor forecast in future. However this study provides a base for future endeavor when the FDI gain its momentum.