Bhutan has made tremendous progress in reducing extreme poverty and inequality in recent years, primarily through the implementation of robust social protection schemes targeting the most vulnerable segments of society. One such initiative is the provision of monthly cash transfers to the most vulnerable population, including children and single mothers, amounting to $63.66 million for the entire pandemic period.

However, poverty persists in rural areas of the country. As evident from its 13th Five-Year Plan (2024-2029), the Government remains committed to prioritizing substantial investments in socio-economic infrastructures to enhance productivity and expand market access. This emphasis aims to empower rural populations economically and bridge the urban-rural gap. The plan also incorporates the development of a shock-responsive, inclusive and comprehensive social protection system to foster a more sustainable growth. Investments on SDG target 1.1. can generate positive effects across other SDGs, such as boosting economic development (SDG8), health (SDG3) and education (SDG4) outcomes.

Bhutanese citizens have access to free health care services and the Government allocates a significant share of its expenditures to the health sector (12.9% in 2023). As a result, the country has witnessed strong achievement in health-related outcomes. Health policies have evolved from an initial emphasis on expanding access and coverage to strengthening the quality of care and improving equity.

Free and improved health services can have a ripple effect: beyond contributing to poverty reduction (SDG1) and enhancing the nutritional status of individuals (SDG2), it can also lead to a greater awareness of hygiene practices, positively impacting water and sanitation (SDG6). A healthier workforce is also more productive, leading to an increased economic output (SDG8), and a more resilient society to climate-related health challenges (SDG13). It can also catalyse progress in partnerships and resource mobilization (SDG17), which is critical for the sustainability of free quality healthcare.

Achieving the SDGs would require an integrated multisectoral response with intersectoral policies further articulated in the 13^th FYP for healthy and productive society, aimed at building a resilient health system.

Following a substantial contraction during the pandemic, Bhutan's economy is rebounding moderately with continued acceleration prospects, driven by a few capital-intensive sectors, such as hydropower, without commensurate employment creation. Low productivity, especially in the agricultural sectors, and youth unemployment remains among the most pressing issues in the country.

Achieving inclusive development and social mobility will require enhancing overall productivity and diversifying the sources of growth. These efforts should be underpinned by a rapid adoption of digital technology and innovation, while addressing the gender digital gap. The ongoing educational reform and specialized skills development program are expected to reduce youth unemployment and enhance worker productivity, directly contributing to harnessing Bhutan's demographic dividend. 

Overcoming these investments are critical for the country to achieve its goal of becoming a developed nation by 2034.

Bhutan is currently encountering significant challenges in urban development with escalating rural-to-urban migration (21.7%). This has led to a concentration of population in urban centers (43.7% in 2022) that are susceptible to extreme weather events. The adaptive capacity of these populations is constrained by inadequate institutional, technical, and financial resources.

Bhutan recognizes access to clean water and sanitation as a pivotal element in building sustainable cities and mitigating health risks in the country. The nation prioritized sanitation and hygiene by providing citizens with improved toilets and water facilities. However, challenges remain in ensuring 24-hour access to drinking water for the entire population.

Achieving sustainable and resilient urban development is possible by strengthening water resource management and creating economically viable water-based industries. Climate-responsive urban planning, integrated green infrastructure, and adoption of sustainable building practices is also crucial for promoting balanced growth in rural and peri-urban regions. These approaches can yield positive interlinkages on outcomes related to SDG6.

Bhutan's success as a carbon-negative country can be largely attributed to effective policies and strategies, underpinned by a strong emphasis on environmental protection, promotion of renewable energy, and a large forest cover (mostly under protected areas). Bhutan reaffirmed its carbon neutrality through its enhanced NDC and Low Emission Development Strategies.

Bhutan renewable energy master plan and Electric Vehicle Road Map (2021-2035) diversifies clean energy sources with solar energy investments. This will accelerate, zero-emission transition and enhance women’s participation in traditionally male-dominated fields.

However, being carbon-negative is facing increasing pressure with higher demand for socio-economic growth and changing land use. Sustaining low-carbon development requires an inclusive and balanced approach that combines economic aspirations and environmental benefits. This challenge is further exacerbated by the threat posed by rapidly melting glaciers and the resulting climatic extremes. Investments in technology and innovation are essential for implementing effective solutions and achieving climate-resilient, low-carbon development.

A vibrant democracy and effective governance are critical for Bhutan’s human development. Since the adoption of the Constitution in 2008, its political systems and governance institutions have made transformative progress, with stronger checks and balances, improved decentralization and service delivery and more robust citizens’ engagement.

However, citizens’ understanding of judicial processes and the law, and women's presence and engagement in decision-making continues to remain low. Providing access to justice and decision-making platforms to vulnerable groups is an ongoing effort in the country.

Through the 13th Five-Year Plan, Bhutan aims to bolster access to information, fostering civic engagement and reinforcing its executive, legislative and judiciary systems through a country-wide digitalization transformation and through the adoption of data driven, anticipatory and adaptive governance mechanisms. Improvements in SDG target 16.6 have multiplier effects in other priority areas for Bhutan: poverty reduction, decreased inequalities, improved nutrition, health and education, gender equality, and effective infrastructure planning.