Though Bhutanese trade with India flourished during the sixteenth-nineteenth centuries, it regained impetus at the debut of the twentieth century because of successive international and domestic events. Political activities around Bhutan and the election of the Tongsa Penlop, Ugyen Wangchuck in 1907 added fuel to trade interests. The objective of this article is to analyze trade trends in general, and exports in particular.

The authors begin by analyzing merchandise exports to British India during the reign of King Ugyen Wangchuck followed by an expose of export trade. Trade trends are assessed in terms of need, in World War I, as trade to British India decreased during that time. While the country targeted its trade to specific regions, paying no heed to market diversification.

In terms of export products, live animals, forest products and manufactured goods predominated, signifying the primitiveness of the Bhutanese economy in the period under study. Bhutan also exported agricultural products to British India, but not in a significant way, the central reasons being hostile physiographic and climatic conditions.

During the reign of King Ugyen Wangchuck, Bhutan’s export expanded significantly for three reasons. Firstly because of promoting exports on the basis of a traditional line of comparative advantages where the direction of exports underwent changes. Thirdly, exports of all articles did not move uniformly during the study period. Certain articles were in high demand, fuelled by the war, such as horses, ponies, mules, and other animals, raising questions about the continuity of findings.