The Bhutanese Leading the way.
According to the state of the nation report presented in the Parliament by Lyonchhen Dasho Tshering Tobgay, 64 percent of Bhutanese still live in rural Bhutan.
To help the rural dwellers in reducing the drudgery and the cost of transportation and bringing market accessibility, the government is aiming to blacktop all gewog centre (GC) roads. So far 89 gewogs have black-topped roads, 71 GC roads are under construction, and black-topping of 24 roads will be done this year.
Almost every village today has road connection and in the last four years, 2,766 kilometers of farm roads were built and 1146.29 km renovated. Altogether, 3,566 km of farm roads will be constructed in the 11th FYP.
“I am pleased to announce that the government will be providing each dzongkhag one excavator, one backhoe and one compressor. This investment will enable local governments to build, upgrade and maintain the farm roads,” announced Lyonchhen, which was in fulfillment of people’s request.
“I am also delighted to inform that in the last four years 3239 Boleros were bought and to enable people to buy vehicles, the taxes for rural utility vehicles are very low. With 783 power tillers already distributed, the government will distribute 343 more so that every chiwog has at least one power tiller,” said Lyonchhen.
The government achieved 99.8% of rural electrification and total of 11,597 households were electrified in the last four years. After the approval of revised tariff rates by the government, the rural residents enjoy 100 units of free electricity each month. “Last year the average subsidy provided was Nu. 1458 million from which the subsidy to provide 100 units free amounted to Nu 88.3 million,” states the report.
In the last four years, 126 villages have been connected with mobile services and almost 94% of rural Bhutan has mobile connection today. This year, 64 more villages will be connected and Bhutan will achieve almost 100 percent cellular coverage in the country.
It has also been reported that with the establishment of farm shops farmers can purchase all the necessities from the shop and that they are grateful for it. So far the government has established 119 farm shops and 35 are under construction. This year 51 farm shops will be constructed so that every gewog will have one. Currently 65 gewogs have access to fuel and fuel outlets will be built in 140 gewogs. And to encourage the people living in rural to open bank accounts, 198 Gewog banks have been established. Rural Enterprise and Development Corporation Limited (REDCL) has so far approved loans amounting to Nu 726 million.
“Understanding the expenses incurred when a life is lost, the cabinet approved the revised rural life insurance with effect from 1st July 2017. Under the new scheme the insurance cover has increased from Nu 15,000 to Nu 30,000. Further the insurer is required to pay Nu 87 and the government provides premium subsidy of Nu.108,” states the report in regard to the Rural Life Insurance.
As per the government’s directive, OAG is presently drafting the Legal Aid Guidelines that will enable the government to start providing legal aid to needy people and the Royal Legal Aid Center is expected to commence its functions by mid September.
The report states that although the government wishes to increase the salary of the civil servants, however it would not be possible till the mega-hydropower projects are complete and the country has a comfortable revenue base.
“While I express regret over not being able to increase their salary, I would like to say that Bhutan has one of the best civil servants, most of who understand the country’s need. I say this as several civil servants have told me that increasing salaries without revenue will destroy the economy. Nonetheless, the increase will happen as soon as we generate more income,” stated Lyonchhen.
Lyonchhen reported that it was very challenging for the government for the effective implementation of the 11th Five Year Plan (FYP) as the plan was still not finalized and the required funds had still not been secured when his government took over.
The plan size increased from the earlier Nu.209.440 billion to Nu.216.848 billion and later to Nu.221.691 to give in the desired impetus. “To make matters worse, during implementation domestic revenue was not realized as projected as the three big hydropower projects could not be completed on time. As of today almost 90% of the plan goals have been realized and by the end of the plan period we are on the road to achieve, even exceed all of the plan targets,” said Lyonchhen.
“Although 12th FYP will be finalized and approved by the 3rd parliament and the next government, the present government has been very much instrumental in taking the responsibility to draft the plan and also secure resources so that it will be easy for the next government in the implementation and successful realization of plan,” states the report.
Bhutan’s economy has been gradually improving and Gross Domestic Product, as of 2016, grew by 6.9% from 2.1% in 2013. The World Bank and International Monetary Fund predict that Bhutan will continue to be one of the fastest growing economies of the world. To manage the debts more prudently, the government has adopted a National Debt Policy, which will also ensure that government is not irresponsible.
Bhutan was ranked 73rd out of 190 countries in the Ease of Doing Business (EoDB) report published by the world bank in 2016.
A total of Nu 68.073M was granted as Business Income Tax exemption for small rural businesses coming up to around 12,140 units. Around 73,148 people with up to a maximum of Nu 10,000 benefitted due to increase in basic exemption limit. 42,002 people who filed their tax were fully exempted from paying PIT for income year 2016.
The government also reduced lending rates from 12.61 % to 11.24 % and so far people have benefitted by Nu 2,029.36 m since the introduction.
A total of 36,564 trade licenses and registration certificates have been issued until now, from which 776 are wholesalers, 8962 retailers and remaining 26,826 micro traders, which is an increase of 2516 businesses during the report period.
Between May 15, 2016 and March 30, 2017 five Foreign Direct Investment (FDI) projects worth Nu.10, 356.10 mn were approved in principle.
