Economic diversification to address Nu 30 bn trade deficit

Kholongchu and Dorjilung projects stuck but Sunkosh to be implemented

With the projected trade deficit of Nu 30bn in the 12th FYP, the government has pledged to narrow the existing trade deficit through economic diversification.

The economics minister, Lyonpo Loknath Sharma said that economic diversification is one of the main platforms to address the country’s expected trade deficit of Nu 30 bn. “In order to diversify the economic, we would like to promote the import and export of goods and explore means for import substitution in the country. Through such inclusive measures we are looking at narrowing the trade deficit.”

The economics minister added that apart from those measures, the country’s four upcoming major industrial parks- Jigmeling Industrial Park in Sarpang, Dhamdum Industrial Park in Samtse, Motanga Industrial Park in Samdrupjongkhar, and Bondeyma Industrial Park in Monggar, that are all expected to be complete within the 12th FYP will be developed by the investors and invest in business ventures once the plot allocations are made—which is also expected to improve the economic situation of the country.

“Two of the industrial parks— Motanga Industrial Park in Samdrupjongkhar and Jigmeling Industrial Park in Sarpang are for medium and heavy industries where FDI venture will be encouraged in order to improve the export of finished products. We are also in the process of revising the FDI policy in order to make the investment climate more conducive in the country. It will also benefit our private sector,” said the economics minister.

Lyonpo Loknath Sharma also mentioned that the cottage and small industries is another gateway for economic diversification in the country. “Through flagship programs we are going to improve the standards of the products from every aspect and look into viable export markets. Moreover, agriculture is also working towards import substitution. These are some of the measures we are working for economic diversification in the country.”

Lyonpo also added that exploring alternatives to reduce fuel import will contribute in narrowing the gap.

Updates on the hydro projects

Kholongchhu as a joint-venture, the economics minister updated that there are still some issues that remains to be resolved because of which the project hasn’t begun with the most essential phase of construction yet.

“In principle, the project has been in discussion for more than 3 years now. However, we have reached to consensus with just a main issue which will be deliberated during the first week of May. This time we have decided to hold meeting directly with the Government of India and the RGOB rather that meeting with all the PSU, after which we will decide on the next move. Our aim is to sign the concessional agreement very soon in order to progress to the hardware part of the construction.”

Concerning the trilateral agreement of the Dorjilung Hydro Project involving Bhutan, India, and Bangladesh, the economics minister said that the procedures are limitless given the participation of three countries. “Therefore, it is still under discussion and we are looking to explore avenues for mutual benefits through such trilateral mode by meeting with the Secretaries of three countries.

Sunkosh hydropower project, the economics minister, updated that the project might happen sooner than expected. However, Lyonpo advised people not to raise their hopes high yet, but assured that the project is slated to sign within three or four months, or at least before the end of this year.

“Our broader aim is to sign the agreement and go ahead given that the GoI is very positive with the project.”

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