Performance-Linked Grants: Bhutan’s Ministry of Finance will start a new framework in FY 2026–27 to assess dzongkhags and thromdes on project delivery, budget execution and compliance, with 30% of capital block grants tied to results. Water Security: A National Water Resources Inventory report warns 227 water sources are drying in Paro and Thimphu, with 18 already dried up, pointing to climate change, forest degradation and human activity. MoICE Delivery Push: MoICE says it hit 192 of 193 KPIs in 2025–26 (99.5%), including plans to establish 2,000 new industries and attract Nu 10bn FDI, but one gap remains in intellectual property service revenue. Cross-Border Cost Pressure: Phuentsholing retail leakage is worsening as 94.9% of residents rely on Jaigaon for some shopping, mainly due to lower prices, turning border shopping into a cost-of-living issue. Tourism Beyond the West: Arrivals jumped to 149,141 in the first half of 2026, but the big question is whether spending is reaching central, eastern and southern communities. Matsutake Market Reality: Exporters in Genye say rising demand in Japan can’t be met—only 3.5–4 tonnes shipped versus buyers’ needs of at least eight tonnes—while the Matsutake Festival is drawing visitors and boosting local income. Legal Services Demand: The Office of the Attorney General handled 1,014 cases in 2025–26, with drug-related offences forming the largest share.