Development cooperation between the Kingdom of Bhutan and Austria began at the beginning of the 1980s. The Austrian Development Agency has maintained a field office in the capital, Thimphu, since 1992. Cooperation focuses on energy supply, tourism development and strengthening rule of law.

Besides economic development, the government of the country on the Roof of the World is primarily concerned with preserving national cultural identity and protecting the environment. Key here is the much-cited concept of Gross National Happiness, which is the guideline for national policy.


Bhutan chose Austria as a development partner in areas where the Alpine republic can draw on extensive know-how, such as forestry and agriculture or tourism. Austria was heavily involved in the construction of the Rangjung and Basochhu hydropower stations and Bhutan led the way in building the third large hydropower station in Dagachu with the help of technical expertise and loan finance from Austria.

Aside from electricity exports, eco-tourism is an economic mainstay for Bhutan. With Austrian support as of 2010, tourism professionals are trained in the Bhutan School of International Hospitality and Tourism, which has been fitted out with all the necessary modern equipment.

Moreover, Austria is supporting the Kingdom of Bhutan in consolidating its young rule of law regime: It is constructing the first courthouses and supporting service-oriented training for judges and court officers.