King Jigme of Bhutan recalls that when he was studying in America, his classmates would scoff in disbelief when he told them there were tigers and elephants in his Himalayan homeland. Like many foreigners, they thought of it as a place of snow-clad peaks and alpine meadows. Even those who had visited were unlikely to have strayed to the subtropical lowlands that border north-east India.

Now, 25 years later, King Jigme is on a fresh mission to enlighten the world about this southern sliver of his realm. And this time, it is not just about the wildlife. In December he unveiled plans for a new city there that would ultimately cover 1,000 sq km, making it bigger than Singapore. Powered mostly by hydro-energy, it is designed to house a million people, including digital nomads, Buddhist pilgrims, crypto entrepreneurs and wealthy expatriates. Bhutan’s current population is 780,000.

King Jigme is not the only world leader with the city-building bug. Think of Saudi Arabia’s Neom development or Indonesia’s future capital, Nusantara. But Bhutan’s project, Gelephu Mindfulness City (GMC), stands out in three ways that could help it to avoid the Ozymandian fate of many such grandiose schemes.

First, consider the geopolitics. Bhutan is land-locked between India and China. The struggle for influence across South Asia between these two countries has intensified lately with political upheavals in the Maldives, Nepal, Bangladesh and Sri Lanka. Bhutan has long been in India’s camp. But in the past decade, it has expanded trade, tourism and other links with China, while edging towards resolving a border dispute. In 2023 it appeared close to a land swap, and possibly establishing diplomatic ties, with China.

India objected. It has hundreds of troops in Bhutan and fears that encroachment by China there could help Chinese forces, in a war, to sever India’s access to its north-east. India has since pledged $1.2bn of development support for Bhutan in the next five years, double that of the previous five. Bhutan now accounts for 36% of Indian foreign aid, more than any other nation. India has also backed GMC. It is building road and rail links and discussing developing a new international airport there. It will provide much of the labour. And rich Indians seeking refuge from congested cities are among the prime targets for GMC’s promise of luxury homes and low taxes.

Indian firms could play an important role. On October 2nd the Reliance Group announced plans to invest $700m in two power projects, one in GMC and one nearby. Adani Group, another Indian giant, has also expressed interest. Because of India’s proximity and friendly ties, the “threshold for allowing Indian contractors would be much lower,” says Lotay Tshering, GMC’s governor. He says there have been no talks with China about its involvement in the city, which will supposedly rely on private investment. But, he adds, there should be no “exclusion criteria”.

The second feature of GMC is its possible draw for the artificial intelligence and crypto industries. Bhutan has 2.5GW of installed hydropower but potential for over 30GW. GMC’s managers say they are talking with big data-centre investors who are scouting for sites with renewable energy sources. One obstacle could be American export controls on AI-related technology. Tshering Tobgay, the prime minister, is confident he can satisfy American regulators and convince India to allow its data to be stored in Bhutan too.

An additional lure for tech investors is progressive regulation. GMC will be a “special administrative region”, allowing more autonomy than a typical “special economic zone”. Laws will be based on Singapore’s and financial regulation on Abu Dhabi’s. Investors will be able to shape regulation too, especially in sectors such as AI, biotech and crypto. Fanciful as that might seem, Bhutan is already a bitcoin pioneer, with six operational mines. In September its bitcoin holdings were valued at $750m, the world’s fourth-highest.

The secrecy of that venture worries some Bhutanese. Foreign officials also fret that Bhutan could attract money from illicit sources or nations facing Western sanctions. Bhutan says it will carefully screen all investors. But how exactly is unclear, given its limited resources and ill-defined diplomatic outlook (it has no official relations with the five permanent members of the UN Security Council).

The project’s third unique trait is the existential crisis behind it. Bhutan has achieved remarkable success since introducing Gross National Happiness as a development measure in the 1970s. In December it graduated from the UN list of “least developed countries”. Its youth literacy rate is above 97%. Since 2015, however, more than 6% of its residents have emigrated, many of them to Australia. King Jigme hopes that GMC will tempt them back while teaching other Bhutanese to compete at home with foreign talent. And if the project succeeds, he plans to introduce similar policies across the country.

GMC’s promoters talk a lot about “mindfulness”, touting it as a place of spiritual retreats and harmony with nature. At its core, though, the idea is much harder-edged: it is designed to be a financial centre offering a gateway to India, much as Singapore and Hong Kong do for China. It is a long shot. But as King Jigme told recent visitors, it may be the only hope for his nation’s future.