What does a tiny country like Bhutan have to do with global climate change? Plenty, according to a recent speech given at the Royal University of Bhutan by World Bank Managing Director Graeme Wheeler. (Okay, I confess: I had a hand in drafting the speech). First, Bhutan has been implementing the former King's strategy of "gross national happiness," which combines environmental sustainability with economic growth. The Constitution reserves 60 percent of Bhutan's territory for forests in perpetuity, and the country has averaged 7 percent growth for a decade. As the world's larger countries such as China and India seek a balance between rapid economic growth and controlling carbon emissions, Bhutan not only shows the way; it shows that it can be done.

Second, Bhutan sits on vast hydropower resources. By exporting hydroelectricity to its neighbors, Bhutan will enable especially India--one of the energy-thirstiest nations in the world--to shift away from burning coal, thereby lowering the carbon content of its energy use.

Third, the Himalayan ice cap is melting rapidly. This could lead in the first instance to a rapid increase in the flow through the rivers that provide Bhutan with its hydropower and subsequently a decline in the same flow. Managing this unprecedented surge and ebb is surely one of the most important long-term challenges facing Bhutan.

In short, in climate change as well as other things, Bhutan and the rest of the world are intertwined, as exemplified by "the endless knot," one of the eight lucky signs of Buddhist philosophy. Graeme ends his speech by pointing to this picture from Bhutan's temple murals depicting four friends: "It does not matter whether you are the small bird on top or the elephant at the bottom – all must work together to reach the fruit."