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Bhutan Economic Stabilization Fund (BESF)

Bhutan · Asia · Founded 2018 · Stabilisation fund · Not an IFSWF member

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Focus

BESF: what it invests in

Financial services
Cash and money markets

Geography Regional

Scale

BESF: how big it is, and on what basis

Nu 167M
Fund market valueAs of

In US dollars: about USD 0.0023B. Converted at INR 72.412 per USD on 3 September 2019; ngultrum pegged to the rupee

Transparency

BESF: what it publishes

1.5 of 10 Band 1 of 5

Published 0 · Partly 3 · Not published 7

Our 10 item score. It measures what is public, not how well a fund is run.

Balance, Sep 2019S2
Nu 167M (about USD 2.3M)
As of
Seed capitalS2
Nu 100M (11th Five Year Plan)
As of
Budget line FY2022/23S5
Nu 200M
As of
Main holding (2019)S2
Fixed deposit (one year, Indian bank)
As of
Transparency scoreS2
1.5 of 10
As of

At a glance. The Bhutan Economic Stabilization Fund (BESF) is a small fiscal buffer meant to shield the national budget from swings in hydropower revenue. The Royal Monetary Authority manages it. Its last published balance was Nu 167 million (about USD 2.3 million) in September 2019, mostly in a one-year fixed deposit with an Indian bank. Budget lines of Nu 200 million followed in fiscal 2021/22 and 2022/23. S2 S4 S5

Key points

  • Last published balance: Nu 167 million in September 2019, about USD 2.3 million. S2
  • Built from Nu 100 million of seed money and a Nu 67 million Ministry of Finance transfer. S2
  • Nu 100 million was placed in a one-year fixed deposit with an Indian bank in 2019. S2
  • Budget reports show Nu 200 million lines for the fund in fiscal 2021/22 and 2022/23. S4 S5
  • The World Bank says hydropower revenue transfers to the fund have been on hold since the pandemic. S1
  • The RMA, led by Governor Dasho Yangchen Tshogyel since December 2025, manages the fund. S6

Interesting facts

  • Planning began with a cabinet executive order in July 2012. S2
  • A Royal Charter for the fund was submitted for approval from the throne in 2019. S2
  • The ngultrum is pegged one to one with the Indian rupee, which shapes where reserves sit. S2

Mandate and goals

The fund backs a fiscal rule for macroeconomic stability, separating spending from volatile hydropower revenue so that surplus income is saved in a ring-fenced account with set rules on use. S2 S1

  • Support a medium-term balanced budget rule. S2
  • Make fiscal policy more countercyclical. S1
  • Keep deposited money working rather than idle. S2

How it invests

IndustriesFinancial services S2
Asset classesCash and money markets S2
StagesCredit S2
GeographyRegional. Deposits with an Indian bank (2019) S2
Direct / through funds / co-investYes / No / No S2
Managed in house100 percent S2
Ticket sizeNo ticket size; the fund holds bank deposits. S2
External managersNone S2
Co-investment programmeNone S2

Largest holdings: One-year fixed deposit, Indian bank Nu 100M (as of 2019-09-03) S2

Published criteria

  • Capital safety and liquidity ahead of return; funds should not sit idle. S2

Past investments

YearInvestmentTypeSectorStageAmount
Not publishedSeed capital. Capital injection during the 11th Five Year Plan (2013 to 2018). S2State asset transferFinancial servicesCreditNu 100M
2019One-year fixed deposit. Placed with an Indian bank; rate not disclosed. S2Direct investmentMulti-sectorCreditNu 100M
2019Ministry of Finance transfer. Raised the balance to Nu 167 million. S2State asset transferFinancial servicesCreditNu 67M
2021Budget allocation FY2021/22. Budget line under grants. S4State asset transferFinancial servicesCreditNu 200M
2022Budget allocation FY2022/23. Budget line under grants. S5State asset transferFinancial servicesCreditNu 200M

Case studies

A buffer for hydropower swings S2 S1

  • What: Set up a ring-fenced account so surplus hydropower income could be saved for weak years.
  • When: 2012 to 2019
  • Size: Nu 167M
  • Why: Hydropower is a large and uneven source of state revenue.
  • Outcome: Nu 167 million by 2019; the World Bank recommends clear contribution and withdrawal rules.

Investment process

The Ministry of Finance makes transfers through the budget; the RMA chooses where to place the money and informs the Ministry. S2

  1. Transfers are budgeted by the Ministry of Finance. S5
  2. The RMA places funds in deposits. S2
  3. Allocations appear in quarterly budget reports. S4

How to approach: No partner or manager process is published. S7

Size and returns

  • Headline size: Nu 167M (Fund market value, as of 2019-09-03) S2
  • In US dollars: about USD 0.0023B. Converted at INR 72.412 per USD on 3 September 2019; ngultrum pegged to the rupee
  • Budget line, FY2022/23: Nu 200M (Announced target, not current assets, as of 2022-09-30) S5
  • Budget line, FY2021/22: Nu 200M (Announced target, not current assets, as of 2021-09-30) S4
  • Returns: the fund does not publish a return figure.

Leadership

NameTitleSince
Dasho Yangchen TshogyelGovernor, Royal Monetary Authority (manager) S62025-12-01
Ugyen ChodenDeputy Governor, Royal Monetary Authority S6Not published

Governance and transparency

  • Legal basis: Cabinet decision and fiscal policy; a Royal Charter was submitted for approval in 2019 S2
  • Oversight: Ministry of Finance, with the RMA as manager S2
  • No stand-alone report; allocations appear in budget documents and a World Bank update box. S5 S1

Transparency score: 1.5 of 10 (band 1 of 5). Our own 10-item rubric; see the methodology page.

  • Partly published: total assets, asset allocation, governance and mandate documents. S2
  • Not published: annual return, long-term returns, geographic or sector split, holdings or deal list, audited financial statements, named leadership, regular reporting schedule. S2 S6

History

DateEvent
2012-07Cabinet order starts a feasibility study. S2
2018Fund established. S1
2019-09Nu 67 million added; balance Nu 167 million. S2
2021Nu 200 million budget line, FY2021/22. S4
2022Nu 200 million budget line, FY2022/23. S5
2025-12-01New RMA Governor takes office. S6

For family offices

The fund holds bank deposits and has no partnership or co-investment programme. S2

Reports

Common questions

What is the BESF?

A fiscal stabilisation fund managed by the RMA to support a fiscal rule. S2

How large is it?

Nu 167 million at September 2019, the last published balance. S2

Is money still flowing in?

Hydropower transfers were put on hold from the pandemic; Nu 200 million budget lines were recorded for 2021/22 and 2022/23. S1

All sovereign wealth funds in Asia · All stabilisation funds · All funds in Bhutan

Sources

  1. S1World Bank, Bhutan Development Update, June 2023
  2. S2The Bhutanese, Bhutan Economic Stabilization Fund stands at Nu 167 mn
  3. S3IFSWF, Our members
  4. S4Ministry of Finance, 1st Quarter Budget Performance Report 2021-2022
  5. S5Ministry of Finance, 1st Quarter Budget Performance Report 2022-2023
  6. S6Royal Monetary Authority of Bhutan, Management
  7. S7Royal Monetary Authority of Bhutan, Home

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