Data Centers in Bhutan
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Bhutan – Himalayan Hydropower & Stability
Executive Summary
Bhutan is an emerging market for organizations that prioritize energy sustainability and operational stability over ultra-low latency access to global hubs. The country's infrastructure is best suited for disaster recovery, data archival, and specific compute workloads that can leverage its abundant, low-cost, and carbon-free hydropower.
Bhutan: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Reflects developing regional connectivity, not a global hub status. |
| Direct Cloud On-Ramps | 0 — as of September 2025 | Access requires transit to regional hubs like Mumbai or Singapore. |
| Power Cost | ~BTN 4.00-6.00/kWh | 93% low-carbon mix, primarily from sustainable hydropower generation. |
| Disaster Risk | Low (2.9/10) — as of September 2025 | Minimal risk from most perils, though seismic activity is a factor. |
| Tax Incentives | No | Investment climate focuses on sustainable development, not specific IT tax breaks. |
| Sales Tax | 7% GST — as of September 2025 | A national Goods and Services Tax is the primary consumption tax. |
Network & Connectivity Ecosystem
Bhutan’s digital infrastructure is developing, with a focus on national resilience and sovereign capacity. While not a major interconnection hub, it provides sufficient connectivity for in-country operations and specific use cases.
Carrier Density & Carrier Neutrality The market is served by two data center facilities as of September 2025. Connectivity is provided by a focused group of national and regional carriers, with an emphasis on government and enterprise services. True carrier-neutral facilities are not yet a significant feature of the landscape.
Direct Cloud On-Ramps There are no direct cloud on-ramps within Bhutan. Establishing a private connection to providers like AWS, Google Cloud, or Microsoft Azure requires network extensions to regional hubs such as Mumbai or Singapore.
Internet Exchange Points (IXPs) The Bhutan Internet Exchange (BIX) is the primary IXP. It helps keep domestic internet traffic within the country, improving local latency and reducing reliance on international transit for in-country communications.
Bare Metal Bare metal server availability is limited. Businesses typically procure hardware directly or work with regional service providers who can manage deployments within local data centers. Global providers like Hivelocity or Leaseweb can serve regional needs from nearby hubs.
Power Analysis
Bhutan's greatest strategic asset is its power infrastructure, which is both reliable and one of the most sustainable in the world.
Average Cost Of Power Industrial power costs are estimated at ~BTN 4.00-6.00/kWh as of September 2025. The country's power mix is 93% low-carbon, sourced almost entirely from hydropower. This offers predictable pricing and an exceptionally low carbon footprint for compute infrastructure.
Power Grid Reliability The national grid is well-engineered and reliable, particularly in the western region where commercial activity is centered. The significant investment in hydropower generation provides a stable and consistent energy supply.
Market Access, Business & Tax Climate
Proximity To Key Business Districts Data center infrastructure is concentrated near Thimphu, the capital city. This location serves the country's primary government, banking, and commercial sectors, ensuring low-latency access for the most critical local applications.
Regional Market Reach From a digital services perspective, Bhutan is primarily a market for in-country service delivery. However, its political stability and low natural disaster risk make it a viable, secure location for disaster recovery and business continuity for firms in nearby South Asian nations.
Tax Advantage For Data Centers Bhutan does not offer specific tax incentives for data center development. The government's policies favor long-term, sustainable foreign investment that aligns with its national development goals.
Natural Disaster Risk
Bhutan has a low overall risk profile, with an INFORM Risk score of 2.9 out of 10 as of September 2025. The country is insulated from many of the natural disasters that affect the broader region, such as cyclones and tsunamis.
Key environmental risks include:
- Earthquake: The Himalayan region is seismically active, presenting the most significant natural hazard.
- River Flood: Seasonal monsoons can create moderate flood risks in valley regions.
- Epidemic: As a landlocked country, managing public health events is a noted challenge.
