…aims to replace 70 percent of vehicles with EVs by 2035

Bhutan imported automobiles worth Nu 944.37 million in the first nine months of last year, with electric vehicles (EVs) accounting for about 20 percent of the total value.

In absolute figures, the country imported 93 units of EVs and hybrid vehicles at a value of Nu 185.25 million in the same period from India and other countries, according to the Bhutan Trade Statistics.

The import of EVs share has jumped from 13 percent of the import value in 2022. Bhutan imported 190 units of EVs worth Nu 430.31 million the same year while the total vehicle import value stood at Nu 3.2 billion.

The import value includes passenger cars, vehicles for the transportation of ten or more people, goods transport, electric cars, and excluding motorcycles.

The import value last year could have been higher had the government not announced the moratorium on the import of non-essential vehicles from August 2022 to save the foreign currency reserves. This moratorium has been further extended until August of this year.

It is worth noting that vehicle imports from India are paid in Indian Rupee, whereas imports from other countries necessitate payment in USD.

In August 2022, the country’s foreign currency reserves dropped to USD 696.22 million from USD 850.85 million in January the same year, a decrease by 18 percent.

The moratorium applied to import of all vehicles including two-wheelers, except utility vehicles, heavy earthmoving machines and agricultural machinery, only utility vehicles costing less than Nu 1.5 million or USD 20,000 (whichever is less) to be allowed.

Vehicles for use and promotion are also exempted from the moratorium, including public transportation like taxis and buses.

An EV taxi driver said that the high tax for fossil fuel vehicles, along with rising fuel prices prompted Bhutanese to opt for EVs.

He also said that a 20 percent subsidy on the cost of EV with a maximum ceiling of USD 5, 500 and a 70 percent loan facility from the financial institution helped them to purchase EVs.

To encourage EVs in public transport, a pilot project called “Bhutan Sustainable Low Emission Urban Transport Systems” was implemented in 2019 with the aim to replace 300 taxis.

Import of petroleum products, however, is on rise. Fossil fuel imports of Nu 8.35 billion in 2021, increased to Nu 11.37 billion in 2022. In the first nine months last year, the fossil fuel import was recorded at Nu 9.98 billion.

Import data reveals a significant decline in vehicle imports from India, which decreased by half, from Nu 4.61 billion in the previous year to Nu 2.23 billion in 2022.

However, imports from other countries doubled to Nu 1.04 billion from Nu 467.84 million, primarily because of purchase of electric vehicles.

In its effort to reduce vehicular emissions, the country aims to replace 70 percent of the vehicles with electric vehicles in the next 14 years, by 2035. The target is specified in the Electric Vehicle Road Map 2035.

The EV road map aims to increase EV sales to 20 percent of the total vehicle sales in the short term- from 2021 to 2025 and increase it to 50 percent by 2030, and then to 70 percent by 2035 in the long term. It also aims to increase charging stations in the country.

As of January, this year, the number of vehicles has increased from 66,430 in 2012 to 126, 678.