Bhutan’s 13th FYP faces a Nu 7.35B funding shortfall across road and water projects, raising risks of delays and scaled scopes while officials look for reallocation and new financing.
Bhutan’s push to deliver major infrastructure under the 13th Five-Year Plan is running into a hard financial wall, with a widening gap between planned budgets and rising project costs.
Misryoum has learned that the Ministry of Infrastructure and Transport (MoIT) is flagging resource shortfalls across 12 projects—eight in roads and four in water supply—raising concerns that some works may slip in schedule, shrink in scope, or spill into the next planning cycle.. The ministry estimates an overall funding gap of Nu 7.35 billion, with the road sector holding most of the shortfall.
Road infrastructure is meant to do more than connect places; it is closely tied to regional mobility, trade routes, and economic integration.. But several high-priority road initiatives are showing sharp differences between their original allocations and updated cost requirements.. The improvement of the Wangdue–Wakleytar road is the clearest example.. Although the project received an allocation of Nu 148.75 million under the 13th FYP, its estimated cost has climbed to Nu 2,056.71 million—creating a gap of Nu 1,907.96 million.
Officials point to scope changes as a key driver.. The shift from early expectations such as blacktopping and drainage to full national highway-standard development has pushed costs upward.. For communities waiting on better travel and transport reliability, the financial gap matters in very real ways: delays can translate into slower access to markets and services, and the longer timelines can also increase the exposure of roadworks to weather and maintenance pressures.
Another road project remains fully exposed to the funding uncertainty.. The Rilangthang–Sechamthang road, covering 11.02 km, has an estimated requirement of Nu 435.86 million but is currently without secured financing.. While survey works have been completed, construction timing still depends on financing decisions, with design work reportedly scheduled only for the 2026–27 fiscal year.
Inter-dzongkhag connectivity is also under strain.. With an allocation of Nu 1,250 million, the estimated requirement for related connectivity efforts stands at Nu 2,673.79 million—leaving a gap of Nu 1,423.7 million.. The pattern repeats again in the Lunana Dzongkhag road project, where the estimated cost of Nu 970.08 million is far above the Nu 154.50 million allocated.. That creates a gap of Nu 815.57 million.. Because the work includes both formation cutting and permanent works, the project is inherently resource-intensive, and the funding gap becomes even harder to absorb without reducing or rephasing key components.
Beyond single projects, the Dzongkhag Road Improvement Programme suggests a wider systemic pressure.. The programme’s estimated cost of Nu 6,961.92 million sits against an allocation of Nu 4,869.92 million, leaving a gap of Nu 2,092 million.. Even with Nu 1,000 million committed by the Office of Cabinet Affairs and Strategic Coordination, the remaining shortfall still puts delivery at risk.
Overall, the road sector sums to allocations of Nu 9,112.72 million against requirements of Nu 15,689.06 million, resulting in a cumulative gap of about Nu 7,354.13 million.. Smaller gaps also appear across other road initiatives—such as Trongsa–Reffee, Yongkola–Lingmithang, and Darachu–Relangthang—showing that the challenge is not confined to just one or two routes.
Water supply projects may involve fewer initiatives, but they are equally critical—especially for potable systems and climate-resilient infrastructure.. Misryoum notes that gaps have been identified across potable and climate-resilient water supply needs in 20 dzongkhags and three thromdes.. In Mongar, the Nagamphu and Ringphu pumping system requires Nu 40 million but has no revised allocation secured.. Trashigang’s town intake and transmission system faces a similar problem, with a gap of Nu 60 million.
In Lhuentse, a larger package covering a transmission main, water treatment plant, and distribution system remains entirely unfunded, with an estimated cost of Nu 120 million.. Meanwhile, the Trashiyangtse Throm water supply project is partially funded: of the Nu 175 million estimate, only Nu 67 million has been secured, leaving a gap of Nu 108 million.. These figures also reflect delays in earlier external financing pathways, including proposals under frameworks such as the GCF-FAO and the Water Flagship Programme, where approvals and confirmations have stalled.
Misryoum understands that implementation is being further complicated by technical and planning bottlenecks.. In some cases, detailed design estimates are still pending finalisation, which makes it harder to lock budgets and timelines.. There are also examples of projects already showing slippage: the Government Office Complex project, with a total requirement of Nu 1.63 billion, is expected to spill into the 14th FYP, with Nu 1.37 billion deferred.. The Hontsho Crematorium project shows minimal progress as well, with only Nu 5.47 million spent out of an approved Nu 600 million, reportedly due to halted design work and the need for specialised expertise.
Urban development efforts have not been spared either. With the expected Gol-PTA funding reportedly not available, some initiatives have been affected, pushing the government to explore alternative external financing options to keep priority works moving.
A shortage of skilled technical personnel is another constraint mentioned in the sector’s reporting, limiting how quickly multiple projects can progress through design, preparation, and construction stages.. On top of that, rising fuel prices and increases in construction material costs—linked to broader global conditions—are adding extra pressure on project budgets, potentially inflating estimates and timelines further if not managed early.
With the clock running on the 13th FYP, officials indicate that MoIT and the Ministry of Finance are expected to jointly review the situation.. The focus is likely to include budget reallocation, prioritisation of critical projects, and the identification of new financing avenues—steps that could determine which projects advance on schedule and which ones are forced to shift into the next planning period.. For a programme built around connectivity and basic service delivery, the Nu 7.35 billion gap is not only a budget figure—it is a test of how quickly the government can adjust plans to protect outcomes for the public.