From aid to trade 

Donor aid or grants have played a vital role in Bhutan’s development and modernization, in the last five decades.

Donor assistance allowed Bhutan to build its first motorable roads, its first modern schools and hospitals and various other important infrastructure.

The Bhutanese government and every Bhutanese appreciate the important and vital role of aid in Bhutan’s development. Bhutan’s biggest donor has been India, followed by countries like Japan, EU countries, other countries, United Nations and other multilateral agencies.

It must be mentioned here that Bhutan’s successful development was also possible due to the honest and efficient use of this aid by Bhutan’s Kings.

Bhutan avoided the example of many developing countries where foreign aid was pilfered by leaders and the countries languished behind.

This is why Bhutan is routinely praised and highlighted in the international community as one of the top countries in honest and efficient aid utilization. Bhutan, in fact, is often part of the success stories of donors.

However, even as Bhutan received foreign aid, its stated national objective was achieving self sufficiency, which in turn would strengthen Bhutanese sovereignty.

Foreign aid is almost ever never free and comes with implicit conditions or strings attached to it. Some of these conditions are actually good for our system like gender main streaming, human rights etc. However, some of the other strings can restrict our sovereignty and impact our international image.

The draft 12th plan marks the first time where Bhutan could reduce this grant dependence to around 19 percent of the total plan which is a big drop.

The positive case example would be our largest donor India. The previous government had decided to seek the same grant amount for the 12th plan as in the 11th plan even though the 12th plan is much larger. The new government is expected to largely stick to this with some flexibility, though it is yet to finalize the draft 12th plan.

In the case of India, the focus has shifted more from the grant given once every five years to much more important engagements in the hydropower sector that not only is the biggest source of revenue for Bhutan but also benefits India.

Bhutan’s development and economy cannot run on grants alone as the very stability of the modern Bhutanese economy rests on narrowing the trade gap and hydropower is the biggest avenue to do it.

Bhutanese people are grateful for all the much required aid from various donors, but the Bhutanese are also a proud and self-respecting people who want to achieve self reliance.

Anybody who supports this natural aspiration of Bhutan is a true and welcome friend.


Don’t ask of your friends what you yourself can do


Quintus Ennius

Check Also

The election

The ECB has announced the election period is on and now it is up to …

Leave a Reply

Your email address will not be published. Required fields are marked *