GDP in 12th plan could drop to 4.7% from from 6 to 7% target: GNHC

Out of plan 14 bn worth of base course for 9,239 km of farm roads planned among others to support the economy

A key concern for the government is that the GDP growth target of 6 to 7 percent in the 12th Five Year Plan (FYP) could drop to 4.7 percent if the current situation continues longer.

The Gross National Happiness Commission (GNHC) Secretary Thinley Namgyel said the 12th FYP plan outlay was Nu 310 bn of which current budget is Nu 193 bn and capital is around 116 bn and so the overall figure remains the same with the capital still at 116 bn.

The 12th FYP has 17 National Key Result Areas (NKRAs) and these key result areas are required to be achieved in order to achieve the 12th FYP objectives.

“When we look at the 17 NKRAS there are some concerns on the four NRKAS.

NKRA 1 and 2 deal with economic diversity and growth.  Though we are in an early stage, when the multi sectoral macro economic framework coordination committee looked at the present situation, I think there were some concerns on whether we would achieve our economic growth target,” said the secretary.

He said the 12th plan target is 6 to 7 percent on an average but based on todays situation, the forecast is about 4.7 percent growth.

“So there are some concerns on if we will actually achieve the economic GDP target if the situation continues,” he added.

The other concerns in terms of NKRA was NKRAs related to health and education due to closure of schools.

The other NKRA was in terms of employment on whether the plan will be able to achieve the employment targets. “Hopefully if things improve we would be able to do,” said the secretary.

The secretary said that when it comes to reprioritization, some of the activities which has been reprioritized are mainly construction activities which are yet to be initiated and these are things like office construction, staff quarter construction, fencing and things which are not of high priority in the current situation has been deprioritized.

Similarly, study tours, workshops and trainings have been deprioritized given the current situation.

In its place, activities related to tourism focusing mainly on re-skilling and activities which can be immediately implemented like roadside amenities has been prioritized.

Similarly, in construction things like skilling and re-skilling will take place.

In the agricultural sector the focus is more on improving market facilities so that farmers are incentivized to produce more.

One new activity is improvement of farm roads.

“We are looking at almost about 9,239 km of farm roads which will be improved over the next three years and this cost will be 14 bn but 14 bn probably will be difficult to implement so it will done be in a phased manner,” said the secretary.

He said immediately in the first phase about 1,400 km of farm roads will be improved which will cost close to Nu 2.3 bn.

Similarly, in the education sector things like online education which was not there earlier has been prioritized.

When it comes to ICT again increasing the bandwidth and making internet affordable is the focus.

He said these are some of the activities which has been prioritized but there there are a whole lot of other activities too.

One is the Samrang-Jomotshangkha road which was to be implemented by DANTAK and it was going to take time so immediately what the Department of Road and DANTAK is doing is to make the road motorable while other things will be continued.

“When it comes to the local government level the amount is the same like before at 50 bn and the only thing that has been prioritized at local level is we have requested to prioritize food security activities but ultimately it is for the GT and DT to decide,” said the secretary.

Lyonchhen said that prioritized and deprioritized list is based on the activities that can be done in the current circumstances, but this is also not for sure as it would change if there is community transmission.

Lyonchhen said that for now it looks like the activities can be carried out in rural areas as there are not many people and there is not much movement there whether from Thimphu or other countries and so there is automatic physical distancing.

The PM said that applying base course on farm roads is not there in the 12th plan and if all 10,000 km of farm roads is to be done then it will cost Nu 14 bn.

He said it cannot be done in one go and so the Gewogs have been asked to prioritize the farm roads in the 205 Gewogs.

The PM said that the broad guidelines are that such base course work should help agricultural productivity, help more people and it should be at a distance away from the Gewog headquarters.

The PM said with one such road selected by each Gewog, around Nu 2 to 3 bn works can be done and plans have been made to implement them soon.

Lyonchhen said that if base course is put on all the 10,000 km of farm roads then it will not require import of materials and labour and there will be natural physical distancing given the remote locations.

The PM said that the Economic Contingency Plan or Stimulus Plan is not a single plan but it includes all of the above.

He said one is the monetary measures from the RMA, which is starting to benefit people, and another are fiscal measures from the Finance Ministry and here too tax breaks and extending tax payment deadlines etc. have been started.

In terms of employment, the three biggest agencies on this are the Ministry of Labour and Human Resources, Ministry of Agriculture and Forest and the Tourism sector. The PM said that since more stress has to be given to these three agencies, project offices have been instituted in these agencies.

Adding to this, the Finance Minister Lyonpo Namgay Tshering said that the aim is to ensure that people are not laid off, have cash to spend and there is gainful employment. He said the Royal Relief Kidu form has a section which asks if people are willing to work.

He said jobs will be there in tourism in maintaining the trails and MoLHR is registering youth who can take part in constructing the Gyalsung infrastructure development and government construction projects. He said that construction manpower required would be around 13,000 to 15,000 just for the Gyalsung project.

The minister said that the plans are being staggered with the first focus on the first three months followed by a longer one on six months depending on how the virus impacts Bhutan.

Lyonpo said that in agriculture the plan is to encourage youth groups to develop fallow land by providing all inputs like electric fencing, seeds, market facilitation and other help.

The Finance Minister said that the farm road base course work would not require much manpower as a lot of the work is done by machines and the materials are available in the country itself. He said in most gewogs 30 percent of the farm roads already have base course.

Lyonpo said that another activity that would be prioritized is the water flagship project which is a Nu 1 bn project staggered over five years, but it would be moved up to be implemented in a shorter time.

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