Drukair: Royal Bhutan Airlines

Drukair Corporation Limited, known as Drukair — Royal Bhutan Airlines, serves as the official airline of the Kingdom of Bhutan. It has its headquarters located in the western dzongkhag of Paro. Established in 1981, a decade after King Druk Gyalpo Jigme Dorji Wangchuck began the process of opening Bhutan to the world and seven years following the country's first foreign visitors, Drukair commenced its flight operations in 1983. Initially, it operated flights connecting Kolkata to Paro using Dornier 228 aircraft. In November 1988, the airline transitioned to BAe 146-100 aircraft, and to meet growing demand, it replaced these planes with five Airbus A319s in 2004.

Photograph by Druk Air

Drukair's primary base is Paro Airport, from which it operates a limited but strategically planned flight network within South Asia and Southeast Asia. Currently, Drukair serves thirteen destinations across six countries. The airline maintains a fleet comprising four Airbus A320 family jets, consisting of three A319s and one A320neo, in addition to one ATR 42 turboprop regional aircraft.

History

In 1968, an airstrip was constructed in the Paro valley by the Indian Border Roads Organisation. Initially, this airstrip was used for helicopter operations by the Indian Armed Forces to assist the Royal Government of Bhutan. Drukair, the national airline of Bhutan, was established on 5 April 1981, following approval from King Jigme Singye Wangchuck and the Tshogdu. This occurred a decade after King Jigme Dorji Wangchuck had begun opening up the Kingdom after a period of self-imposed isolation and seven years after welcoming its first foreign visitors.

Photograph by Druk Air

Paro Airport is situated deep within a valley at an altitude of 2,235 meters (7,333 feet) above sea level and is surrounded by mountains as tall as 4,900 meters (16,100 feet). At that time, the runway measured 1,200 meters (3,900 feet) in length. This dictated specific requirements for the type of aircraft that could be operated from the airport. The Bhutanese government needed an aircraft capable of short takeoff and landing (STOL) with a seating capacity of 18-20 passengers. Additionally, it had to possess a high service ceiling, rate of climb, and maneuverability. The primary requirement was that the aircraft should be capable of flying non-stop from Kolkata to Paro and back, covering a round-trip distance of 1,200 kilometers (750 miles) due to limited refueling infrastructure at Paro. Three different aircraft types underwent flight tests in India and Bhutan between 1978 and 1980, but none met the criteria.

In the mid-1980s, the Indian government formed a committee to assess its own need for a light transport aircraft. Following this competition, the Bhutanese government placed an order for a Dornier 228-200, with delivery scheduled for January 1983. They also had the option to order a second aircraft for delivery later that year. The first 18-seat Dornier 228-200 touched down at Paro Airport on 14 January 1983, and the time of arrival, the number of passengers onboard, and even the parking direction on the airport apron were predetermined by the high lama of Paro Dzong.

Drukair commenced its scheduled revenue flights on 11 February 1983, with Flight 101 departing from Paro to Kolkata and returning as Flight 102 the following day. Initially, the flight operated three times a week, later increasing to a daily frequency. At that time, Paro Airport consisted of the runway, a two-room air traffic control building (with the ground floor serving as the check-in counter), and a departure lounge on the lawn. Before the establishment of the Department of Civil Aviation in January 1986, the airline managed the operation and maintenance of airport infrastructure. Drukair expanded its network to include Dhaka, Bangladesh, starting on 30 October 1986.

On December 30, 1987, an order totaling $25 million was placed with British Aerospace for the acquisition of a BAe 146-100 STOL regional jet. This purchase was financed by the government, marking the first instance in the country's history where a commercial loan was obtained for such a purpose. In 1988, Drukair relocated its operational base from Kolkata to Paro Airport and also recruited its inaugural seven flight attendants, who received training from Thai Airways International.

The BAe 146 was delivered to Paro Airport on November 21, 1988, enabling Drukair to expand its network by connecting Paro with Delhi on November 26, 1988, Bangkok on January 28, 1989, and Kathmandu in April 1989. During its initial year of service with the BAe 146, the airline exceeded expectations, achieving an average load factor of 50–60 percent and transporting 12,732 passengers between 1989 and 1990, surpassing the anticipated 40 percent.

Photograph by Druk Air

In 1990, Paro Airport's runway was extended from 1,400 meters to 2,000 meters and strengthened to accommodate heavier aircraft. The construction of an aircraft hangar was also funded by the Indian government as part of the Paro Airport Development Project.

On November 9, 1990, King Jigme Singye requisitioned the airline's sole aircraft to facilitate his travel to Tokyo for the coronation of Emperor Akihito of Japan. Subsequently, the King journeyed to Malé in the Maldives for the South Asian Association for Regional Cooperation summit from November 21 to 23 before returning to Bhutan, allowing the aircraft to resume service on November 25. This caused a disruption in Bhutan's tourism industry due to a government requirement that foreign tourists (except Indian nationals) enter and exit the country by air, resulting in substantial penalties for tour operators. This problem was partially alleviated with the introduction of a second BAe 146 in 1992. On November 11, 1993, the airline introduced a 10-seat Executive Class on its aircraft. Drukair was officially registered under the Companies Act of Bhutan on May 13, 1991, and it commenced service to Yangon, Myanmar's capital, on January 6, 1997. Passengers traveling on Drukair flights between Kathmandu and Paro are afforded the opportunity to view Mount Everest.

Between 2000 and 2001, Drukair operated with just one aircraft for over a year due to a corrosion defect in its A5-RGD aircraft's wing tanks, which was discovered during an inspection at Woodford. The wings were subsequently replaced, and in 2002, an RJ70 was wet-leased from airBaltic to cover for maintenance on A5-RGE.

In April 2000, Drukair became the launch customer for the Avro RJX-85 when it placed an order for two aircraft with BAE Systems. Initially, deliveries were slated for November 2001 and January 2002. However, delays in the first flight and certification of the RJX pushed the expected delivery date to after April 2002. BAE Systems ultimately canceled the RJX program in November 2002, as only two airlines, Drukair and British European, had placed orders. British European threatened legal action to enforce their contract with BAE Systems, leading the aircraft manufacturer to offer to fulfill the contract for Drukair. Nevertheless, the airline decided against acquiring the aircraft, citing potential challenges in sourcing spare parts in the future.

In the quest for replacements for its two BAe 146s, Drukair management considered submissions from Airbus, Boeing, and Embraer to assess the suitability of their products for meeting the airline's rigorous operational requirements. Although Bombardier was invited to showcase the CRJ900 regional jet, they advised that it was unsuitable for Paro operations. In February 2002, the Airbus A319 became the largest aircraft to land at Paro Airport during a demonstration. Boeing withdrew from the competition later in October due to difficulties in sourcing an aircraft for demonstration. While the Embraer E-190 had not yet flown, it was anticipated that Drukair would order the A319. However, concerns about financing for the purchase delayed the final decision in October. After a brief period, the government instructed management to restart evaluations, and in February 2003, a Boeing 737-700 underwent eleven test flights at Paro Airport, demonstrating its suitability for the airline's operations.

In July 2003, Airbus signed a memorandum of understanding with Drukair for the acquisition of two 114-seat Airbus A319-115 aircraft powered by two CFM56-5B engines. These were scheduled for delivery in the second half of 2004. The acquisition of these two jets, valued at 3,534.36 million Bhutanese ngultrum (BTN), represented the largest single purchase ever made by Bhutan and contributed to a 250 percent increase in the Bhutanese trade deficit for the financial year 2004–2005 compared to the previous year. The Bhutanese government issued government bonds worth BTN 1,767.18 million to finance one aircraft and, for only the second time in Bhutan's history, intended to seek a commercial loan for the other aircraft. However, in October 2004, it announced its intention to seek a soft loan for this purpose instead.

Photograph by Druk Air

On November 11, 2003, Drukair initiated services to Gaya, India, on the occasion of the king's birthday. Bodh Gaya, located 10 kilometers from Gaya, houses the Mahabodhi Temple where Siddhārtha Gautama, the Buddha, attained enlightenment. Approximately 30,000–40,000 Bhutanese make the pilgrimage to Bodh Gaya each year. Prior to Drukair's service, pilgrims had to undertake a 2–3-day overland journey from the Bhutanese border town of Phuntsholing. Drukair aimed to capture 20–30% of this traffic, although it had not yet recorded a profit on the route as of February 2006. The following month, in response to efforts by the Royal Bhutan Army to expel Indian separatist insurgent groups from Bhutanese territory, particularly the United Liberation Front of Asom and the National Democratic Front of Bodoland, flights to Dhaka were suspended from December 29 to prevent insurgents from using Drukair flights to escape to alleged hideouts in Bangladesh.

In 2007, Drukair achieved its first profitable year, with earnings of BTN 31.15 million. The two BAe 146 aircraft were subsequently sold to Star Perú for US$3.3 million in October 2007.

On November 11, 2007, Druk Gyalpo Jigme Khesar Namgyel Wangchuck issued a Royal Kasho to establish Druk Holding and Investments Limited, a holding company tasked with managing the Royal Bhutanese government's current and future investments. This move resulted in the transfer of ownership of seven government-owned companies, including Drukair, from the Ministry of Finance to the newly formed holding company. Druk Holding and Investments, incorporated on November 13, 2007, announced in December 2007 that the head of the government agency overseeing tourism development in Bhutan would become the chairperson of Drukair, focusing on enhancing the national airline's performance, given its critical role in Bhutan's tourism industry.

Photograph by Druk Air

In March 2008, Drukair introduced a new uniform for its flight attendants, consisting of a contemporary kira and tego, to commemorate the centenary celebrations of the monarchy and the airline's silver jubilee. The uniform design was selected through a competition, with the winning designer receiving a BTN 75,000 prize. The textiles for the uniform were chosen via a competition organized by Drukair and the United Nations Development Programme, promoting the Bhutanese textile industry and culture.

Despite Bhutan's efforts to preserve its cultural integrity, Drukair faced challenges common to the global airline industry. In June 2008, citing rising oil prices and the need to control operational expenses, the airline reduced flight frequencies and increased airfares. It also capitalized on lower jet fuel costs at Delhi, Kolkata, and Bangkok airports. Drukair frequently leased its aircraft to other airlines, including Myanmar Airways International and Bangkok Airways, to maintain higher utilization rates and generate extra revenue.