March 13, 2026
THIMPHU – Bhutan is facing a demographic dilemma. With fertility rate falling well below replacement levels and a significant portion of youth emigrating, the country faces long-term implications for its labour force, economic productivity, and the sustainability of social protection systems.
To address the decline, the government previously pledged a monthly cash incentive of Nu 10,000 for families with a third child or more, payable until the child turns three. However, this pledge remains unimplemented.
Speaking on behalf of the Prime Minister, Cabinet Secretary Dasho Kesang Deki at Meet-the-Press yesterday explained that while the proposal and budget are ready, the Cabinet emphasised the issue’s complexity during its 77th Session.
The government has since directed that a comprehensive demographic study be conducted to ensure any future intervention is grounded in robust evidence. “This study will examine fertility trends, marriage patterns, migration dynamics, and overseas births among Bhutanese citizens,” Dasho Kesang Deki said.
She added that the government is developing a Sustainable Population Strategy, expected to be finalised within this financial year. This holistic approach will integrate youth retention, gender-responsive policies, childcare support, social protection reforms, and human capital development.
The reality of the crisis
The urgency is backed by data. Bhutan’s total fertility rate stood at approximately 1.866 children per woman in 2025, falling below the replacement level of 2.1.
This is a sharp decline from the 1990s, when the average was five to six children per woman. Consequently, the population growth rate has dropped from over 3.1 percent in 1994 to less than 1 percent today.
For many young Bhutanese in Thimphu, economic realities dampen the decision to start a family.
Rising inflation and housing costs are major deterrents, alongside the “double-income trap,” where both parents must work, leaving them with limited childcare options. Additionally, many young professionals prioritise career building or plan to migrate abroad.
Currently, roughly 66,000 Bhutanese, about 8.5 percent of the population, reside overseas. Australia hosts the largest diaspora, followed by Canada, the United States, Japan, and parts of Europe and the Middle East.
A trend of late marriages, delayed childbearing, and a focus on careers and economic stability has driven the country’s fertility rate to new lows. This decline, which leads to fewer births and an aging population, is shrinking the future workforce.
An aging society
Projections indicate that Bhutan will transition into an “aging society” by 2027, with the elderly population reaching 7.4 percent. By 2050, this figure is expected to rise to approximately 14 percent, signaling a shift toward an “aged society,” according to the Population Projections for Bhutan (2017-2047).
The report states that the elderly population will grow from 43,064 individuals in 2017 to 118,650 by 2047, a 58.2 percent increase over the next 30 years.
While less than 9 percent of the population was aged 60 or older in 2017, nearly one in five Bhutanese will fall into that category by 2047.
The country’s median age, which was 22 in 2005, has risen to over 30 in 2025 and is projected to reach 40 by 2047.
As of March 2026, United Nations data places Bhutan’s current population at 800,130, with a mid-year estimate of 802,214.
Government initiatives
Beyond the proposed third-child incentive, the government is expanding reproductive healthcare.
The Ministry of Health plans to introduce in-vitro fertilisation (IVF) services at national referral hospitals by the financial year 2026-2027.
Health Minister Tandin Wangchuk said that a doctor is currently training in Singapore, though a lack of technical human resources remains a hurdle. The national referral hospitals currently provide intrauterine insemination services.
Additionally, the Accelerating Maternal and Child Health Programme continues to support mothers during the critical “first 1,000 golden days. This includes a Conditional Cash Transfer of Nu 1,500 per month for vulnerable pregnant and lactating women.
The revised Income Tax Act 2025 introduces a Parenthood Child Tax Credit to support resident parents and legal guardians. Aiming to ease child-rearing costs and encourage population growth, it offers Nu 1,000 for the first child, Nu 1,250 for the second, Nu 5,000 for the third, and Nu 10,000 for the fourth and each subsequent child.
Global best practices
The neighbouring Indian state of Sikkim has introduced targeted measures to address its declining population and low fertility rate. These include salary incentives for employees with more children, enhanced parental leave, and paid childcare support. The state organises free infertility camps, expanding IVF services, in collaboration with the Indian Council of Medical Research and the National Institute for Research in Reproductive and Child Health.
Several countries have adopted wide-ranging strategies to boost birth rates. France provides child allowances, tax breaks and childcare subsidies, increasing benefits for larger families.
Hungary offers cash grants and zero-interest loans for families with three or more children, while Russia runs a “maternity capital” scheme supporting housing, education and childcare.
Sweden and Germany provide paid parental leave. Singapore and Japan subsidise childcare and early education, while South Korea and China support housing. Canada and Australia use skilled immigration, while Denmark, Norway and Italy promote work-life balance and family-friendly campaigns.