Thimphu, Bhutan, 20 January 2025 – The Global Environment Facility (GEF) Least Developed Countries Fund (LDCF) has approved US$20 million in grant funding for Bhutan’s new initiative, Enhancing Climate Resilience of Urban Landscapes and Communities in Thimphu-Paro Region (ECRUL). With co-financing commitments of more than US$62 million from the Royal Government of Bhutan, the project seeks to tackle the growing climate challenges facing Bhutan’s key urban centres.

Bhutan’s capital, Thimphu, and the neighbouring district of Paro are home to a quarter of the country’s population and contribute to over 40 percent of its GDP. However, rapid urbanization combined with climate change impacts, such as flooding, landslides, and water scarcity, threaten their resilience. Existing infrastructure is not adequately designed to withstand climate shocks, leaving these cities highly vulnerable.

The six-year ECRUL project (2025–2030) will implement innovative, nature-based solutions to mitigate these risks, focusing on restoring 800 hectares of watershed and springshed land, upgrading early warning systems and enhancing stormwater management infrastructure. The project will be implemented by the Ministry of Infrastructure and Transport in partnership with UNDP. The project will directly benefit over 146,000 residents.

"Bhutan has experienced rapid urbanization in recent decades, making climate resilience in our growing cities increasingly critical amid more frequent and severe climate events. The ECRUL project is a significant step toward enhancing the resilience of urban landscapes, aligning with Bhutan’s Nationally Determined Contribution (NDC) under the Paris Agreement and the National Adaptation Plan (NAP) adopted last year,” said Dasho Karma Wangchuk, Secretary of the Ministry of Infrastructure and Transport (MoIT).

He also mentioned, “By strengthening water management, disaster preparedness, and integrating climate resilience into urban planning, this initiative addresses key national priorities. As the apex agency overseeing urban development, the Ministry of Infrastructure and Transport (MoIT) is hopeful that the ECRUL project will drive a transformative shift towards integrated, coordinated, and climate-resilient urban planning and development in the country.” 

“Despite its status as one of the world’s only nature-positive, carbon-negative countries, Bhutan faces serious threats from the impacts of climate change. We are proud to support the Government of Bhutan’s efforts to address these impacts in the two most populous urban centers in the country – efforts that we believe will ensure community resilience to climate change, while safeguarding the nation’s development progress and contributing to the philosophy of gross national happiness,” Global Environment Facility CEO and Chairperson Carlos Manuel Rodríguez said. 

“This project, specifically targeted towards enhancing urban resilience, builds on our longstanding partnership with the Royal Government of Bhutan in the area of climate change mitigation and adaptation. It reflects our commitment to creating sustainable and resilient urban spaces while safeguarding the natural environment. With GEF LDCF support, we can pioneer nature-positive solutions that benefit not only Bhutan but also serve as a model for other developing nations,” said UNDP Resident Representative Mohammad Younus. 

By advancing inclusive planning, implementing innovative climate technologies, and fostering partnerships, the ECRUL project is set to generate valuable knowledge and lessons for replication across Bhutan and beyond. As one of the countries in South Asia experiencing fastest urbanization, Bhutan’s proactive approach to addressing climate risks marks a critical step in building a sustainable future.

For more information, please visit the project page here.

Media Contacts:

Dechen Wangmo, Communications and Partnerships Analyst, UNDP Bhutan, dechen.wangmo@undp.org

Nawaraj Chhetri, Program Analyst, UNDP Bhutan, nawaraj.chettri@undp.org

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UNDP is the leading United Nations organization fighting to end the injustice of poverty, inequality, and climate change. Working with our broad network of experts and partners in 170 countries, we help nations to build integrated, lasting solutions for people and planet. Learn more at undp.org or follow at @UNDP

About the GEF

The Global Environment Facility (GEF) is a multilateral family of funds dedicated to confronting biodiversity loss, climate change, and pollution, and supporting land and ocean health. Its financing enables developing countries to address complex challenges and work towards international environmental goals. The partnership includes 186 member governments as well as civil society, Indigenous Peoples, women, and youth, with a focus on integration and inclusivity. Over the past three decades, the GEF has provided more than $26 billion in financing and mobilized $149 billion for country-driven priority projects. The family of funds includes the Global Environment Facility Trust Fund, Global Biodiversity Framework Fund (GBFF), Least Developed Countries Fund (LDCF), Special Climate Change Fund (SCCF), Nagoya Protocol Implementation Fund (NPIF), and Capacity-building Initiative for Transparency Trust Fund (CBIT).