In the 21st century Bhutan has re-established its geopolitical identity by adopting a new system of government, a new constitution and also creating a global interest in their policy of Gross National Happiness. Leo Rose, in his seminal 1977 work, “The Politics of Bhutan”, observes that there is “no other political system presently extant with which the Bhutanese polity is comparable in either its ‘traditional’ polity or its process of political development.” In 2008 Bhutan adopted a democratic system of government with the approval of the Monarchy. The new democracy still works with the consent of the 5th King of Bhutan, as the Head of State. The new governance structure of Bhutan is intrinsically tied to its holistic state policy of Gross National Happiness (GNH), which Bhutan adopted as a state policy, pioneered by the 4th king in 1972. This paper discusses the process of democratization in Bhutan and   role of the monarchy in the new governance. This paper examines how the new governance structure of Bhutan, has succeeded in adapting to the state policy of GNH. The paper is based on fieldwork in Bhutan, and interviews with government officials including the Speaker of the National Assembly, journalists and other researchers in Bhutan involved with implementing the policy of GNH under the new democratic government. The research seeks to answer the following questions: How has Bhutan made the transition from Monarchy to Democracy? What is the role of the Monarchy in the new democratic Bhutan? How has the new government implemented the policy of GNH? What has been the impact of GNH on the people, including the different ethnicities living in Bhutan?  What has been the international response to GNH? Despite challenges, the new governance in Bhutan, has developed a holistic vision of sustainable development for its people under the banner of Gross National Happiness.

The paper will be based on the following outline:

Introduction: Where is Bhutan in the 21st century?
The Monarchy in Bhutan.
Development of democratic institutions in Bhutan
The new democracy: Constitution and Elections
Gross National Happiness and its implementation and global impact
Transition from Monarchy to Democracy
Holistic vision of sustainable development