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The people of Bhutan call their country 'Druk-Yul'. In Bhutanese language, Druk means dragon and 'Druk-Yul' means 'the land of the Dragon'. This is because when the sect of Buddhism, which was later to become the dominant religion in Bhutan was founded by the Shabdrung (see picture on the left) at the Ralung monastery in Tibet, 'a loud roar of the thunder dragon' was heard echoing to the south. This was taken as an auspicious sign that the sect would fluorish in the south of Tibet, where Bhutan is, and the sect was named as the 'Drukpa sect'. The country where this sect later flourished was thenceforth known as 'Druk-yul'.To this day, the state religion of Bhutan is 'Drukpa Kargyud' although other sects are almost equally popular and tolerated.
One thing that all Bhutanese are proud of is that Bhutan was never colonised. Despite many wars with Tibet, and some rough encounters with the British, Bhutan always managed to remain independent.
Recorded histroy begins from around the 8th century AD. In the 8th century, the great Tantric mystic Guru Padmasambhava (more popularly known as Guru Rimpoche in Bhutan) came to Bhutan from Swat, present-day Pakistan, and spread the Buddhist faith through the land, planting the seeds of the culture that flourishes today. Temples and monasteries dating from the 8th century still stand as honoured places in contemporary Bhutan.
The greatest event in the history of Bhutan was the arrival of Shabdrung Ngawang Namgyel from Tibet in 1616. He was aged 23. He was to become the first person to bring all parts of Bhutan under one central authority and unify the 'country'.
"Shabdrung" literally means "at whose feet one submits". He was the father and unifier of medieval Bhutan. He was a great man. After repelling numerous Tibetan invasions, the Shabdrung subdued the many warring feudal overlords and brought all of Bhutan under the influence of the Drukpa Kagyud School. His 35 year reign also saw the establishment of a nation-wide administration, aspects of which still endure, and the building of dzongs as easily defensible fortresses and seats of local government. In fact, many of the dzongs you see today were built during the Shabdrung's reign, although some future renovations were carried out.
Shabdrung set up a dual system of Government with a secular head known as the 'Druk Desi' and a spiritual head known as the 'Je Khenpo'. However after his death, before his reincarnation would be found and would come of age, rivalry between different lords and fight for power broke up, which took Bhutan through a tumultuous period until 1907, the hereditary monarchy was insititued in Bhutan with Gongsar Ugyen Wangchuk as the first king of Bhutan.
Like the great Shabdrung, Ugyen Wangchuk pacified the feuding Regional Governors who had plunged Bhutan into a state of almost perpetual civil war. Having consolidated his authority across the entire country by 1885, he played the key mediator role between the British and the Chinese. Finally, on December 17 (Bhutan's National Day) 1907, Ugyen Wangchuk was unanimously elected by all Regional Governors and the Central Monastic Body, at the Punakha Dzong and crowned "Druk Gyalpo" ("Precious Ruler of the Dragon People).
The present king, the fourth hereditary monarch, is Druk Gyalpo Jigme Singye Wangchuk, upon whose coronation in 1974 Bhutan opened its doors to tourists.
Courtesy: Some materials presented here has been taken from Phuntsho's homepage at: http://www.geocities.com/Athens/Parthenon/5200/PHUN.htm