Everything grew — in dollars, far less

Bhutan’s first Five-Year Plan, in 1961, spent Nu 107 million. The thirteenth will spend Nu 512 billion — about 4,800 times more. It is the kind of number a country puts on a banner.

Convert each plan to US dollars at the exchange rate of its own day, though, and the increase is only about 245-fold. The other 95% of the apparent growth was never there. It is the gap between the ngultrum the plan is counted in and the dollars it is worth — and the gap is the rupee, which fell from ₹4.76 per dollar in 1961 to roughly ₹95 today.

Two details make the point unforgettable. First, the 7th Plan (1992–97) actually shrank in dollars — about USD 573M down to USD 498M — even though it was 63% larger in ngultrum, because the 1991 rupee devaluation ate the difference. Second, the divergence is not unique to government spending: the same shape appears in GDP, in a graduate’s first paycheck, in hydropower export earnings, and in India’s grants. Bhutan keeps score in a ruler that has been shrinking for sixty years — which is the whole case for the monetary bets the country is now placing to climb out of it.