The Kingdom of Bhutan over the past five decades has gone through a remarkable socioeconomic transformation. It has progressed from a traditional stage of economic development, with limited production rooted in the primary sector, to achieving the pre-conditions for an economic takeoff. However, Bhutan is still confronted with a number of development challenges, including a narrow economic base, limited private sector development, underdeveloped credit markets, and a buildup in economic inequality with significant youth unemployment. This book chronicles Bhutans development story, discussing a range of policies that can unlock the countrys economic potential and overcome its limitations. It consolidates a body of knowledge accumulated by the Asian Development Bank while working with the Government of Bhutan on monitoring and strengthening its macroeconomic management framework, and through support to development activities throughout the country.