The Government of Bhutan is a constitutional monarchy; between 1907 and the 1950s however, Bhutan was an absolute monarchy. The peaceful march to democracy has been a steady one. The King of Bhutan is head of state. Executive power is exercised by the Lhengye Zhungtshog, or council of ministers, headed by the Prime Minister. Legislative power is vested in the bicameral Parliament, both the upper National Council and the lower National Assembly. A royal edict issued on April 22, 2007 lifted the previous ban on political parties, ordering that they be created, in anticipation of National Assembly elections to be held the following year. In 2008, Bhutan adopted its first modern Constitution, codifying the institutions of government and the legal framework for a democratic multi-party system
The Bhutanese people have historically never had doubts about their nation's
sovereignty. Bhutan in fact has never been colonized. However, to the outside
world, namely India and before that the British Raj, Bhutan was viewed as less
than sovereign for their own geopolitical interests. Bhutan was treated as a suzerainty by the British Raj,
during which time the present monarchy was established. Foreign and defence policy
was to be decided by the British according to the 1910 Treaty of Punakha.
This did not mean so much to the Bhutanese however due to their policy of
self-imposed isolation. In 1949, after Indian
independence, Bhutan and India agreed to a ten-article, perpetual treaty
which effectively continued the relationship, but with India taking the place of
the United Kingdom. That is, India agreed not to interfere in Bhutan's internal
relations, while Bhutan agreed "to be guided by the advice of the Government of
India in regard to its external relations" (Article 2). The treaty also
established free trade and full extradition between the two countries.
While Bhutan sees its destiny as being closely linked with that of India, for
which reason it strives to promote excellent relations with it, it has also
quietly striven to assert its sovereignty at the same time.
Article 2 of the 1949 treaty has mostly been ignored by both countries as
Bhutan confidently handles all of its foreign affairs, including the sensitive
border demarcation talks with China.
In February 2007, the Indo-Bhutan Friendship Treaty was substantially revised
with all references to phrases such as "will be guided" deleted, thus
eliminating the last lingering doubts about the sovereign and independent status