Industrialists and Govt disagree on viability of 3 out of 4 Industrial Estates

Industrialists want more focus and resources on the Dham Dhum Industrial estate in Samtse over others

There is a debate brewing between the private sector and the government on the upcoming Industrial Estates in the country at Dham Dhum in Samtse, Jigmeling in Sarpang, Motanga in Samdrup Jongkhar and Bondeyma in Mongar.

Many of the industralists are of the view that the government should focus on the most viable of them all at Dham Dhum in Samtse instead of developing the other three at the same time and in doing so, spreading out the resources.

The Bhutan Chamber of Commerce and Industry (BCCI) in the recent past requested the government to consider prioritizing and developing Dham Dhum given its location opposite the West Bengal border.

The location of Dham Dhum, according to Industrialists brought it closer to both raw materials and the main markets and most importantly would not face security issues and political problems associated with Bhutan’s border regions along Assam.

Former BCCI President Ugen Tsechup Dorji said, “This long term view has been expressed over and over again on the viability of Dham Dhum. India is a cost sensitive market and any additional costs in bringing in raw materials and exporting finished goods due to longer distances will make it unviable.”

He, like other industrialists also highlighted the political problems in Assam.

“Even big industries in India are not investing in Assam due to the political problems,” he added.

BCCI Secretary General Phub Tshering said that while BCCI welcomes balanced regional development, it would like to request the government to give more importance to Dham Dhum as it is more viable.

Industrialists point out that while Jigmeling is the biggest, it borders Assam and the same goes for Motanga. They say that Bondeyma in Mongar will also not be a viable exporting hub.

The main heart of the issue is that out of Nu 1.5 bn to come up with basic infrastructure in the four estates the government has secured around Nu 800 mn from the Government of India.  The government is spreading this amount among the four estates while Industrialists feel it is better spent in Dham Dhum.

An industrialist on the condition of anonymity cited the growing price of land in Samtse as a testimony to its viability. “People all over Bhutan are buying land there due to its commercial potential and so are voting with their money,” he said.

Another industrialist who owns a major manufacturing company but is not willing to reveal his name said that many of his colleagues will not find it viable to invest in places like Jigmeling.

On the other hand the Director of Department of Industries, Tandin Tshering has a surprise in store for the industrialists.

He said that Dham Dhum will not allow any major energy intensive and polluting industries.

“Only clean and green and less polluting industries will be allowed there is it is right next to the Samtse town,” said the Director.

The Director also said that during the mid-term review the issue of focusing on Dham Dhum was raised but the government gave the directive to continue with the current strategy of developing all four Industrial Estates.

The Director also said that the private industries are overlooking a key aspect of the whole issue, which is funding.

He said, “The Government of India has graciously granted funds for even Jigmeling and Bondeyma in addition to Dham Dhum, and so why should we not use it.”

“The reason why our Industrial Estates have remained only on paper for so long  is due to funding as the government has other important priorities like health, education etc, so when we do get the funds we should use it to develop economic infrastructure,” he added.

Tandin said that the government has to think of balanced regional economic development in developing the Industrial Estates.

He said Bondeyma in the center would cater to cottage, small and medium industries as the biggest impediment that they faced was lack of land.

On Jigmeling he said there was 756 acres of vast and promising land already available with all the necessary clearances. In addition it had existing infrastructure like a power substation, nearby Vocational Training Institutes, Hydropower repair center, airport etc.

He said that it could easily host even IT enabled industries or other types of industries that does not involved frequently transporting raw materials.

On the security issues the Director said that in his view a cue can be taken from the Pasakha Industrial estate where in the beginning there were similar apprehensions about the ‘Rangamati Gundas’ but today they were nowhere to be seen.

He said that in his personal opinion security is a de-facto arrangement that would come once an area’s population increases and there is more vehicular movement. He also said that once people across the border have a stake through jobs and other services then the security situation would automatically improve. He also said that Assam would not remain the same forever especially with the focus of India’s look east policy and Modi’s plans for Assam.

The Director said that it would be much easier for the department to just focus on Dham Dhum and implement it but the government is following a much more ambitious strategy by developing all four estates.

He also pointed out that there is no such thing as a state of the art estate as the actual cost of fully developing the estates would run into the billions. As examples he said Jigmeling by itself is estimated to cost around Nu 2 bn while Dham Dhum is estimated to cost Nu 2.3 bn.

According to the Director the best approach is to build a basic infrastructure and make use of the current infrastructure already available in those areas like power substations.

Of the four estates the department has floated advertisements for Motanga which has received proposals for a Plaster of Paris unit, construction material unit, wire mesh unit and applications to relocate from the town area.

The Director said that notices to apply for plots in the three other estates will also be floated soon.

The plan is to start construction of the estates in full swing by July 2016 so that it is ready to take advantage of the upcoming Mangdechu and Punatsangchu projects too.  The Director said that for small and medium industries the requirement for power would be even less and so they would not have to even wait for mega projects.

Serving a reminder, the Director said that the government was purposely not developing the estates on a public and private partnership model as it would then become profit oriented making it expensive for industries. He said that the government solely developing it would mean much more reasonable lease rates like in Pasakha.

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