Assessment of low carbon transport for sustainable development in Bhutan: a general equilibrium approach

Abstract

Bhutan is dedicated to make its economy carbon neutral and to follow the exemplary path of low carbon development in the coming days. In the process of doing so, Bhutan identified that its transport sector is one of the most important sectors to address. Low carbon technology in transport sector is crucial for Bhutan to combat climate change related impacts. In this paper we have identified four different low carbon interventions possible for Bhutan and analysed their impacts on national economy, social welfare, income status and environment as a whole. The study demonstrates that low carbon transport intervention especially electric cars have highest positive macroeconomic impacts in Bhutan but at the cost of increasing urban rural income disparity. This further draws the attention of policy makers to take preventive measures in the case of introducing the policy for electric cars. In this study we also showed that modal shift (private to public transport) also has positive impacts on economy and environment in Bhutan.