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Fourth phase of monetary measures provides loan restructuring options

ཉིམ།, 06/25/2022 - 15:39

Eight loan restructuring measures extended to ease the impact of the pandemic

Thukten Zangpo 

Phase IV of the monetary measures will allow eight different forms of loan restructuring options to support depending on the severity of impact of the pandemic and the affordability of the borrowers.

The measures include deferment of loan repayment, partial repayment of loans, extension of maturity period for term loans, change in the repayment frequency, conversion of overdraft or working capital facility to a term loan, loan splitting, transfer of loans to third party, and extension of gestation period.

The Royal Monetary Authority (RMA) issued standard operating procedures (SOP) of the monetary measures to the financial service providers (FSPs) on Thursday which allows them one or more loan restructuring measures based on the risk classification and affordability of the borrowers.



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The sectors were categorised under high, moderate, and low risk.

Hotels and Restaurants, both standard and budget are categorised under the high-risk sector, would get a deferment of loan repayment for up to two years and an option of partial loan repayment of 50 percent installment for up to two years.

Similarly, loan-term for hotels and restaurants under construction would be extended from 20 years to 30 years excluding the gestation period for both existing and new loans.

Under the moderate risk sectors, construction (contract-based), hospitality, entertainment, and recreational services, mining and quarrying, manufacturing enterprises, handicrafts and textile production, trade (retail), housing (commercial), home loans, personal loans (consumer and mortgage), transport (commercial and non-commercial), and education loan would get a loan deferment for up to one year. These sectors would also have the option of partial repayment of 50 percent of installments for up to one year.

Both high and moderate risk sectors can extend the maturity period of loan terms up to three years in addition to the deferment period. This will allow a reduction in installment amount by spreading the repayments.



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The support measures also allow the sectors to change their repayment frequency to monthly, quarterly, or half-yearly.   

The sectors are also eligible to convert the overdraft working capital facility to term loans, which will enable the borrowers to make the payment as per the agreed repayment schedule.

Additionally, loans can be split into multiple accounts to reduce equated monthly installments and can be used with other loan restructuring facilities such as deferment of repayment or partial repayments.

The loans can also be transferred to a third party to an independent party wishing to purchase the collateral.

For projects under construction, the gestation period can be extended up to two years depending on the progress of the project.

Meanwhile, low-risk sectors like institutional or educational services, ICT, contract (non-construction), consultancy services, health services and traditional medicines, wood-based products, renewable energy, hydropower, traditional and herbal medicines, trade (wholesale), crop cultivation, livestock farming, agro-processing, forestry, loan against fixed deposits and others are eligible for an extension of gestation period up to two years depending on the progress of the project.

Interest accrued from loans deferred or partially repaid for the period from phase I to phase IV would be converted to a fixed equated installment facility (FEIF) account.



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FEIF accounts are created for the transfer of accumulated interest during the deferment period. Borrowers would be liable to pay the amount in the FEIF account in equal installments for a period of up to five years.

Similarly, for soft working loans ending deferment or gestation period on June 30 this year, the FEIF would be opened for the transfer of accumulated interest and commencement of repayment without charging interest.

However, the RMA stated that a separate directive would be issued on the accounting treatment and other prudential requirements related to FEIF accounts.

According to the RMA, outstanding loans as of June with performing repayments are eligible for the support.

However, loans to the government, loans to financial institutions, staff incentive loans and credit cards, soft working or working capital or bridging loans granted under the previous monetary measures, FEIF accounts, and non-performing loans (NPLs), including loans suspended, under litigation or asset pending foreclosure are not eligible for the latest monetary measures.



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The SOP states that NPLs would be resolved through NPL Resolution Framework. The framework aims to support and rehabilitate viable NPLs through loan restructuring measures while resolving the non-viable loans through various foreclosure means such as court or out-of-court settlements.

“Extending relief measures to NPLs without careful consideration would only defer the problems temporarily without necessarily resolving underlying issues. And in the process, the borrowers are often burdened with growing indebtedness, causing social concerns,” the SOP stated.

Currently, the FSPs are in process of developing their specific internal SOP for the implementation.

Bar Council hands lawyer 1-year suspension for unethical conduct

ཉིམ།, 06/25/2022 - 15:38

Staff Reporter  

The Bar Council of Bhutan yesterday suspended a private lawyer for breaching the code of conduct. The suspension comes into effect on July 15.

A woman had complained to the Jabmi Tshogdey (Bar Council) that her lawyer Ngawang Tobgay had simultaneously represented her opposing party’s case at Paro dzongkhag court, while her case was ongoing with the High Court. She asked the lawyer to refund the fees she paid him.

The case was reviewed by the disciplinary committee of the Bar Council.

The woman attached the validly executed agreement between the parties to prove that her lawyer was obliged to take up her case till the completion of the appeal system.



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Ngawang Tobgay admitted the existence of “Conflict of Interest” as alleged when the agreement with his client was still valid.

The woman requested the council to take action against Ngawang Tobgay and assist her in restituting the fee that she had paid him.

The Bar Council on the recommendation made by the Disciplinary Committee has found that Ngawang Tobgay presently holds a Bar Council certificate to practice as a jabmi (lawyer).

“Jabmi does admit the existence of conflict of interest by intentionally representing the case of his client’s opposing party simultaneously albeit in another court (Paro), without the consent of the client while the case was ongoing in the High Court,” stated the council’s decision handed to the parties.

On January 3, 2022, Ngawang Tobgay appeared before the committee and admitted his existence of “Conflict of Interest” by representing the client’s opposite party in another court during the subsistence of the agreement.

The council found prima facie evidence, including an admission by the Ngawang Tobgay, of “Conflict of Interest” for representing his client’s opposing party without the client’s consent.



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Section 36 (d) of the Jabmi (Amendment) Act of the Kingdom of Bhutan 2016 imposes a duty on jabmi to “always respect the interests of their clients and not represent them where interests of the clients’ conflict.”

Section 36 (e) of the Act imposes a duty on jabmi to “give disinterested advice to the client and if the jabmi is or becomes interested in the transaction of the client he/she should disclose such interest to the client.

Moreover, the jabmi was obliged to represent the client’s case till the Supreme Court of Bhutan upon which only the remaining amount of Nu 300,000 was to be paid by the client as per the agreement executed in October 2021 between Jabmi and the woman.

“In this case, the Jabmi has failed to abide by the code of conduct of the Jabmi (Amendment) Act 2016 by failing to disclose conflicting interests to the client,” the Council’s decision stated.

The Act constitutes unprofessional conduct and therefore, violated the provision of the Jabmi (Amendment) Act 2016.



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The Bar Council decided that Jabmi was not liable to refund the Nu 200,000 the complainant paid in advance. The two sides had agreed on a fee of Nu 500,000 of which the Jabmi was paid Nu 200,000 at the initial stage of proceedings. The Jabmi had prepared the documents, provided legal advice and represented his client in the dzongkang court and the High Court. Therefore, the committee did not find any basis to ask the jabmi to reimburse the advance paid.

Ngawang Tobgay is not allowed to appear before the court as jabmi for any person, whether in an ongoing or new case, until the suspension order is revoked by the Bar Council.

Government subsidies to SoEs drop

ཉིམ།, 06/25/2022 - 15:37

MB Subba 

The government has slashed its annual subsidies to state-owned enterprises (SoEs) and other agencies by 4.5 percent in the fiscal year 2022-23 although the Covid-19 pandemic has affected their businesses.

The total subsidies provisioned for the fiscal year have been reduced to Nu 1.915 billion (B) from Nu 2.007B in the previous fiscal year.

The government provides subsidies to help critical sectors or enterprises keep the price of a commodity or service low and sustain their businesses.



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A majority of the SoEs claimed they have been struggling financially due to the Covid-19 pandemic, but have fulfilled their social mandates.

While about Nu 1.84B of the total subsidies is for recurrent expenses, Nu 75.88 million (M) is for capital works.

More than Nu 1.4B is for domestic power tariff. The government provides the subsidy to Bhutan Power Corporation Limited (BPC).

The Broadcasting Service Corporation Limited has been allocated Nu 182M in the new fiscal year.

The state-owned broadcaster has been severely affected by the pandemic both professionally and financially, according to BBS officials.

As an SOE, BBS is required to meet 50 percent of the current expenditure from the revenue it generates. In 2021, the BBS’s financial performance improved and generated Nu 44.950M.



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The Bhutan Chamber for Commerce and Industry (BBCI) has also been allocated Nu 10.5M.

The government has allocated Nu 50M as operational subsidy for community service centres under the National CSI Development Bank.

More than Nu 86M million has been alloted for interest and principal payments on account of the purchase of aircrafts.

The Bhutan Agro Industries Limited has been allocated Nu 14.459M for interest subsidy and almost Nu 3.6M as price support.

SOEs are not only a major source of revenue for the government but also play a strategic role in providing infrastructure and public service by operating in key strategic sectors.



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Few SOEs had frozen the recruitment of employees for financial reasons while some have resorted to cost-cutting measures to cope with the loss of revenue.

Meanwhile, the rationale behind providing subsidies is to help SOEs meet their social mandates and the public services.

Is Bhutan’s economy at risk? 

ཉིམ།, 06/25/2022 - 15:37

Thukten Zangpo

Rising food prices driven by cost of transportation, a growing trade deficit, burgeoning debt, and decreasing domestic revenue. These are not good signs for any country recovering from the Covid-19 pandemic. Is the country’s economy at risk?

Bhutanese economy has been recovering well from the pandemic after the economy contracted to 10.1 percent in 2020. The finance ministry in its budget report for the fiscal year 2022-23, had projected the real gross domestic product (GDP) to grow at 3.7 percent in 2021 and 4.5 percent in 2022 respectively. In 2023, the economic growth is projected at 3.88 percent.

However, economists say that the country’s short-term economic outlook is concerning. The World Bank had also recently signaled that many countries could face stagflation, a slow growth combined with high inflation.



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Inflation

Bhutan’s consumer price inflation accelerated from 5.6 percent in 2020 to 7.4 percent in 2021, which was above the Royal Monetary Authority’s (RMA) upper tolerance of 5 percent. The inflation eased to 5.79 percent as of April this year.

Inflation hurts the fixed-income groups, workers in informal sectors, small businesses, and the poor the most. An economist said that combined with higher unemployment, rising inflation will push more people below the poverty line, household debt will also rise, and spending cuts will follow.

Food prices contributed to about 60 percent to the overall inflation and non-food contributed to 40 percent in 2021.

The finance ministry in the budget report stated that the rising cost of fuel will have a ripple effect that can cause a significant trade shock. Similarly, the rising cost of goods is likely to affect manufacturing competitiveness and impact investment prospects. It could also paralyse the economy because it erodes the purchasing power of Ngultrum making the cost of goods expensive for consumers.

However, the ministry projected inflation to fall to 5.2 percent in 2022 and 3.5 percent in 2023 at the pre-pandemic level if supply-side disruptions dissipate and global food and energy prices stabilise.



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Fiscal deficit

Bhutan’s fiscal deficit has been widening over the years. The fiscal deficit of Nu 2.734B (1.5 percent of GDP) in the fiscal year 2018-19 was projected to grow at an alarming rate to Nu 17.498B (9.3 percent of GDP) in this fiscal year.

With dwindling domestic revenue, the deficit is projected to further widen at an all-time high of Nu 22.882 billion (B), which is 11.25 percent of GDP in the fiscal year 2022-23 of the total expenditure estimated at Nu 74.807B.

According to the finance ministry, the deficit would be financed through net external concessional borrowing of Nu 0.27B and net domestic borrowing (treasury bills and long-term government bonds) of Nu 20.356B.

The deficit was observed because of the shortfalls in the domestic revenue collection and increased spending requirements related to the pandemic. Bhutan adopted tax cuts during the crisis and forgone revenue of Nu 5.01B in the income year 2020. Tax to GDP ratio was 11.7 percent in the fiscal year 2020-21, a decrease of 1 percent as compared to the previous fiscal year.

According to the budget report, the ministry targets to contain the fiscal deficit below 5 percent of the GDP during fiscal year 2022-23.



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Trade deficit

Rising prices of goods and increasing imports is already widening the country’s current account deficit (CAD). The CAD was projected to widen from 12.4 percent of GDP in the fiscal year 2020-21 to 23.6 percent of GDP (Nu 44.4B) in this fiscal year.

Moreover, the trade deficit which is the largest component of CAD was estimated to widen from 7.1 percent in the fiscal year 2020-21 to 17.8 percent of GDP in the fiscal year 2021-22.  This was attributed to a decline in energy generation and lower hydro exports and a significant increase in imports. However, figures with the ministry show that both exports and imports including electricity increased by 18.9 percent and 35.8 percent respectively in 2021 compared to 2020.

The country’s export was little more than half the import value at Nu 58.25B. Import in 2021 was worth Nu 90.323B.

As the economic activities picked up imports from India surged to Nu 71.236B in 2021 compared to Nu 51.379B in 2020. Imports from third countries also saw a surge. Bhutan imported goods worth Nu 18.99B in 2021. It was Nu 15.26B in 2020.

As an import-dependent economy with a pegged exchange rate, any depreciation of the Indian rupee versus the US dollar raises the cost of imports from third countries. However, the pegged exchange arrangement is in favour of Bhutan as more than 80 percent of its trade is with India.

The ministry projected that the CAD to narrow as trade balance improves and electricity exports increase with the commissioning of the new hydro-projects- Puna-I, Puna-II, and Nikachu in the medium term.



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Foreign currency reserves

Widening current account deficits eats into the foreign currency reserves. The gross international reserves is estimated to deplete to USD 1.33B this fiscal year from USD 1.56B from the previous fiscal year.

Of the total, convertible currency (CC) reserves are estimated at USD 1.157B and INR reserves at INR 13.076B (USD 171.6M). The total reserves would be sufficient to finance 22 months of essential imports.

“It is on a declining trend as no new investments generating foreign exchange earnings have been identified. The recent trend indicates that there has been a significant increase in imports without many corresponding inflows, which could possibly risk the pegged exchange rate regime,” the ministry stated.

Tourism and export was either shut down or was happening on a minute scale, which had a significant impact on the reserves of a country. Foreign direct investment (FDI) also did not see much growth.

According to the ministry, the CC reserves inflows are limited to external grants, loans, and hydropower receipts making it difficult to meet the balance of payment obligations and straining the foreign currency reserves.

Prime minister Dr Lotay Tshering during a question-answer session on June 21 said that if the country faces a foreign reserves crisis, the government has to either reduce or stop imports. He added that Druk Holding and Investments is coming up with plans to revamp two to three existing FDI projects to earn foreign reserves.



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External Debt

As of March, this year, the country’s debt was recorded at Nu 247.68B (130.9 percent of GDP). About 89.7 percent of the debt was external debt. Major share of the debt was from the six hydropower projects in the country. At Nu 162.197B, hydro-debt contributed to 73 percent of the total external debt.

Non-hydro debt stood at Nu 59.91B, constituting 27 percent of total external debt.

INR denominated debt accounted for 69.7 percent of total external debt at Nu 154.9B and the convertible currency debt was USD 884.191M which was equivalent to Nu 67.20B.

Of the total debt, 91.2 percent of the hydro-debt was denominated in Indian rupee.

Director of Macroeconomics, Research and Statistics of the RMA, Gopal Giri, during the Bhutan Democracy Forum last month said that if the pegged exchange regime is distorted, Bhutan might have to pay more for hydropower debt. He added that although the Indian rupee is depreciating currently, the exchange rate is not volatile as India is a big economy.

The ministry projected the external debt to increase from Nu 229.202B on June 30, 2022, to Nu 239.814B by June 2023, an increase of 4.6 percent.

The growth was projected mainly due to hydro loan disbursements, projected at Nu 11.737B for the fiscal year 2022-23, and Nu 5.470B of budgetary loan disbursements from multilateral development banks and Japan International Cooperation Agency.

The external debt-to-GDP is projected to reach 117.9 percent in the fiscal year 2022-23, a steep jump in the following fiscal year 2023-24 hitting 129.1 percent.

The projected hike in fiscal year 2023-24 is mainly contributed by the capitalisation of interest during construction of Punatsangchhu-II estimated at Nu 42.333B with the expected commissioning in June 2023.

However, delays in hydropower projects could pose risks and could raise the country’s debt. The cost of the two major ongoing hydropower projects in the country, 1,200 megawatts (MW) Punatsangchhu-I (P-I) and 1,020MW Punatsangchhu-II escalated to Nu 93.75B from Nu 35B and 89.77B from Nu 37B estimated in 2009 respectively.

Understanding Tourism Industry

ཉིམ།, 06/25/2022 - 15:36

Current national discourse on the tourism industry, with all the passion and diversion of views, is educative. It is a welcome trend that there is a vigorous exchange on an issue of national concern and importance and impact. 

Of course, people are upset. Some of them might lose their businesses and some may need to change their careers. It is obvious from the views and arguments that, for some, it is about personal interests, which is understandable. For some, it is a general concern about an important issue, which is reassuring. And some are getting the message that Bhutan must aim high and must achieve those goals. 



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Emerging from the sometimes-heated debate are some illuminating perspectives on how we understand concepts. One is that we often distort the term “high-end”. For most people high-end tourism means wealthy visitors who stay in expensive luxury hotels. We forget that high-end refers to the destination, not the tourist’s bank account. It is the experience which includes the comfort of the stay, quality of services, and the excitement of seeing and learning about lives elsewhere. 

This is why, when we suggest that the government invest in high-end tourism, we don’t mean building fancy restaurants and smooth roads. We mean improving the standard of education and health care, quality of transport infrastructure, managing waste – making life better. In the context of Gross National Happiness, it is the responsibility of the government to create the conditions that benefit both guests and hosts. Such conditions are created through infrastructure, the regulatory environment, and investment.



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When a tourist says, “for $ 200 I can get a luxury hotel in Phuket,” it’s a verdict on Bhutanese hotels and services. It does not mean that we should lower our rates. It means that we should raise our standards. And, in today’s debate, we remember that tourism is more about the locale than the hotel.  

We mean creating an environment where tourists and local residents can jog or stroll in safety, not bothered by antisocial elements or bitten by dogs. We mean quiet treks through pristine forests and not being swamped by the masses. We are also talking about the feel of a society at peace and people who are not intent on ripping-off guests. We are talking about a taxi driver or shopkeeper who takes the trouble of returning a bag left behind by a passenger or customer. 

The new policy sets the stage for healthy competition among service providers. Bhutan can still aim for resorts where guests are served fresh vegetables from its own garden. When we talk about products, we are talking about what we ourselves eat and use and wear and hang on our walls. We want to elevate a market where our shops try to palm off cheap trinkets from India and Nepal as Bhutanese handicrafts. 



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Another issue is the perception of stakeholders in the tourism industry. Tourism is more than operators, agents, guides, hotels, and others who work in the industry. We are now reminded that Bhutan and all Bhutanese citizens have a stake in this industry. This important industry must benefit all Bhutanese, especially the sections of our population which enrich our identity. Communities like the Layaps and Brokpas and Doyas must be involved in the industry as beneficiaries and not be just photo opportunities. 

Yes, we have to deal with the discomforts and stresses of change. But, hopefully, we are going through the teething problems of a new initiative to liberalise the Bhutanese tourism industry and introduce bold changes. There are many questions to be asked. While we don’t expect the average citizen to sacrifice all comforts in the interest of long-term benefits to the country, a simple way to look around us and ask ourselves: “Is this high end? What would happen if we don’t change things now?”

Property Act required to address urban tax issues

ཉིམ།, 06/25/2022 - 15:35

Nima Wangdi

For several years now, peri-urban residents in numerous dzongkhags have been paying higher taxes meant for urban dwellers without receiving any urban facilities or access to amenities. Residents, over the years, have written repeatedly to various authorities and representatives to resolve the issue.

Mongar’s Member of Parliament (MP) Karma Lhamo raised the issue at the National Assembly for the residents of Naling, which is next to Mongar town but does not have any urban amenities except for a farm road.

Karma Lhamo said that levying urban tax on the residents who don’t have proper drinking water supply or plotting and demarcations has become a problem. “The village partly falls under Throm.”



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She said, “The residents said its unfair to impose an urban tax on them.”

In 2016, the works and human settlement ministry issued an executive order that exempted the people in this village from the urban tax. “However, the urban tax was again imposed after two years,” Karma Lhamo said.

She asked the Finance Minister, Namgay Tshering during the question hours yesterday at the National Assembly for a response from the government on the issues.

Finance Minister Namgay Tshering said that the problem started with the first government in 2010.

“Since then, governments initiated temporary measures to these problems. But the problems worsened during the second government’s tenure in 2015,” Lyonpo said.



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Lyonpo Namgay Tshering said that previous elected governments had different plans for declaring different townships. They did not consider if the old tax system would be applicable. “The question has been asked for three years in the house for now and it is an important issue.”

He said that Lhayulkha in Haa, Jalikhar in Bumthang, Dewathang in Samdrupjongkhar and Pasakha in Phuntsholing have the same problem. “There is no Act for properly tax but to this day, we have been following the Revised Taxation Policy, 1992.”

Lyonpo said that the government can’t focus on addressing the problem only in Mongar and that it would work to solve problems in all the dzongkhags together. “For now, although the tax should be imposed in uniform, different dzongkhags have different systems.”

“Having a dedicated property tax Act should be the permanent solution to this problem,” Lyonpo said.

The government has been discussing it for three years and the outcome is expected soon, the minister said.

BBP engages 4,000 youth

ཉིམ།, 06/25/2022 - 15:33

Yangyel Lhaden

Build Bhutan Project (BBP), which would end next month, has engaged about 4,000 youth in construction sector.

The number of youth engaged is more than half of its target to engage 7,000 youth within two years.

Labour Minister Karma Dorji shared the figures during the first hour of National Assembly, yesterday.



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He was answering the question from Khar-Yurung Member of Parliament (MP), Tshering Chhoden, who asked the status of BBP and its way forward as the project comes to an end next month.

She questioned if BBP was able to provide youth skills-related jobs. “I am doubtful if BBP could have addressed youth unemployment because the overall unemployment rate is 4.8 percent and youth unemployment is 20.9 percent.”

Lyonpo Karma Dorji said that in two years, BBP engaged 1,739 youth in specialised firm, private construction, and hydropower projects and 2,121 youth were trained in various skilling programmes such as masonry, carpentry, electrical, painting, and welding.



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He said that although the project’s aim was to engage 7,000 youth by skilling them and creating jobs, the project couldn’t engage more than 4,000 youths. “We couldn’t meet the target though we gave them opportunity because many youths are not interested in taking construction-related jobs.”

Lyonpo Karma Dorji said that although the project was coming to an end next month, labour ministry would continue to provide construction-related skilling programmes through the ministry’s skills development programme and village skills development programme.

He said that there are 49 specialised firms established through BBP, which would also continue to provide jobs to jobseekers in construction sector. “In collaboration with Ministry of Work and Human Settlement we have initiated certified builder through which youth would be provided skilling and they will get opportunity to construct private buildings.

Zham village residents in Lhuentse wait for water project to complete

ཉིམ།, 06/25/2022 - 15:32

Tshering Namgyal | Lhuentse

The DeSuung water project in Zham village of Minjey gewog, Lhuentse, which was scheduled to complete four months ago, would complete in two months.

Launched in August 2021, the project was initially targeted to complete in six months, but it delayed due to the pandemic, maintenance of the approach road followed by frequent breakdown of machines at the site.

With the tractor road size formation cutting of 5.7 kilometres of 6km length from the source to the main outlet near the community temple completed, project officials said about 75 percent of the work has been progressed as of now.

Officials said only about 200 to 300 metres towards the source, which is mostly cliff, is left.



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“As of date, the construction of end chamber and 3.8km pipe joining has been completed,” an official said. “Pipe laying in 4.2km stretch is done. All pipes are shifted halfway of the stretch for laying.”

However, intake reservoir construction will be possible only after the formation cutting reaches the source.

Officials said the pipe joining work was stalled after the generator got broke down. “We are yet to get a new one,” an official said. “We are following up with the supplier.”

Officials said they would finish the work in two months if monsoon favours. There are 29 deSuups in the field today although there are 84 when it first commenced.

Meanwhile, the project would cater water from Longorchu stream that runs via Gulibi between Zham and Tongling villages.

The project is expected to benefit 42 households by irrigating nearly 400 acres of arable dry land and wetland in the village which remained fallow because of lack of irrigation water.

Farmers of Zham are happy that the ongoing irrigation water project would complete soon.



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A farmer with the highest land holding in the village, Kelzangla, said he is planning to cultivate paddy in all nine acres of field once the water is connected.

“As of now, we depend on rainwater to supplement the existing small stream and could cultivate only half of the paddy field,” he said.

He said the small irrigation water from Amdrangchu which was serving the purpose in the olden days for few households in farming was not sufficient with increasing population over the years.

“We are in dire need of water and we are grateful to His Majesty The King and the government.”

Kezangla said his family could also sell about 800 dre of rice and generate income once water reach the field.



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Amdrangchhu-Zham tshogpa, Thinley Gyatsho, said residents faced acute shortage of irrigation water problem and farmers fight and quarrel for water during cultivation season.

He said farmers guard their fields at night and they had to introduce a lucky dip system. “But this is unfair for those who get their turn last because by the time their turn comes, some seedlings also die and hamper the production.”

According to the tshogpa, the water project would help farmers carry out cultivation on time.

Minjey gup, Jigme Tenzin Zangpo, said although 80 percent of land in Zham village is wetland, about 40 percent was left fallow due to water shortage. “The water project would benefit them immensely.”

The 32M worth project is being implemented by the government in collaboration with armed forces and DeSuups. After completion, the beneficiaries will take care of its operation and minor maintenance.

Only two buildings in Jomotsangkha town

ཉིམ།, 06/25/2022 - 15:31

.. drungkhag asks landowners to start construction soon

Kelzang Wangchuk | Jomotshangkha

Of more than 100 landowners in Jomotsangkha town who got lagthram since 2018, only two constructed buildings in the town today.

Another building is under construction and the drungkhag administration approved another.

Most landowners in the town said they have no plans to start the construction because of fewer business opportunities.

A landowner, Tashi, said he has no plan to construct a building in the town at the moment as he has no money. “It would be difficult for us to build as he has no income.”

Another landowner, Sushila Damala, said since the drungkhag has less population, there won’t be tenants. “There are also government houses.”



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She said bank interest rates are high. “We wouldn’t be able to pay the loans.”

A landowner, Chimi, said it would help if drungkhag could allow them to construct two-storey buildings instead of three-storey buildings in the town.

Landowners, however, said the drungkhag has potential to become a tourist attraction for regional tourists as it is located near two Indian states of Assam in the south and Arunachal Pradesh in the north.

Jomotshangkha drungpa, Lamdra Wangdi, said the Ministry of Works and Human Settlement (MoWHS) approved the local area plan (LAP) in 2016 and issued lagthram to the landowners in 2018.



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He said as per the development control regulations (DCR), landowners should complete the constructions within five years after issuing the lagthram.

The drungpa said the drungkhag administration had been encouraging landowners to start the construction phase-wise if they cannot construct three-storey building at once.

“We told the landowners to start constructing the ground floor and then continue with the remaining floors whenever they get money. We do not force them to construct three-storey buildings at once,” he said.

The drungkhag provided water supply and electricity connection and constructed roads in the town. Internal road and sewerage would be constructed soon.

Pound women keeping the roads open and safe

ཉིམ།, 06/25/2022 - 15:30

 Yangyel Lhaden

 At Ngangshing, nineteen kilometres towards Samdrupjongkhar from Wamrong. It is early morning. The mountains are still very dark and dense.

The day before, a heavy rain had wreaked havoc along the highway. Vehicles are stranded; from both ends, there is a long line of vehicles. And many are joining the line from night-halt in Wamrong. The queue is growing by the hour.

There is a group of women walking along the roads. They are taking it easy. There are multiple blocks along the road; it is not their responsibility to clear them all.

Gaily one walks in to announce her wish. “The longer it takes to clear the road [from the other side], we have some respite to enjoy. These are Bhutanese women keeping the highways clear and clean. One can easily strike a conversation with these women, but who are they, really?



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The women are working with Project DANTAK. When Indian workers left home in the wake of the Covid-19 pandemic, the country faced a serious shortage of worker. For many in the villages along the highway, there was a new opportunity.

There are about 20 road workers between Ngangshing and Narphung. If the block is cleared before lunchtime, their task for the day is to remove rocks on road, clear the drain, mix cement and help with the construction of wall, and also trim the grass along road above Narphung—pretty light going by their daily experience.

Chogyal Wangmo, a mother of four, got in touch with Project DANTAK and landed a job. “When there is job opportunity hitting at the door, why not take it? For us, in the villages, it’s a big thing.”

All the women working on road have similar stories to share—they want extra income to support their family and children’s education. Many come from disadvantaged family backgrounds.

Chogyal Wangmo said that with cost of living getting expensive by the day, her husband’s lone income was not enough to support her family. “My children are aware of what I go through every day. They tell me not to work, but that does not help. I want my children to rub shoulders with their mates and do well.”



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Chimi Wangmo, 23, is a mother of a five-year-old girl. Her husband died two years ago. She wakes up at 5:30am every morning and drops her daughter to community Early Childhood Care and Development (ECCD) centre. And then she reports to work. By then, it is already at 7:00am.

Her daughter is the first to arrive in ECCD and last to leave.

Chimi Wangmo said that the instructors in ECCD have been taking care of her daughter. She is grateful.

Chimi Wangmo started working with Project DANTAK two years ago. She had to leave for Drametse, Mongar to perform rituals for her late husband. Without better options, she has returned. “I came back to work here because I had debt to clear.” Her alcoholic husband left her and the child with a heavy load debt to clear.

Now Chimi, being the eldest sibling, has to educate her brothers and sisters. She was not a bad student herself and wanted to become a doctor.



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Another roadside worker, Sonam Zangmo, said that the pay is not all that bad. “ If we work regularly, we earn Nu 14,000 a month.” She earns around Nu 9,000 a month.

Nidup Zangmo would not have any source of income had she not decided to work under Project DANTAK. The sole provider in the family, she takes care of her ageing father and school-going daughter.

A single mother of an 11-year-old girl, Nidup used to work in Coca-Cola factory in Phuntsholing. She did not return back to Phuntsholing after she found a job with Project DANTAK. Her husband was a driver who passed away when she was four month pregnant. She used to live with her uncle in Phuntsholing and financially supported her daughter who lives in Ngangshing with her parents. “ My mother passed away two years ago and my father is also getting old. I had to stay back.”

The women here, along the highway, say that although they were satisfied with their work they are looked down upon. “What they think of us doesn’t matter. Probably we would think the same if they were in our shoes. It’s hard work we are doing to keep the roads open and we are proud of our ourselves.”



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Nidup, the brightest of the group and the most vocal, said schemes like provided fund would be of great value for the roadside workers like her. “It is only because of pandemic we are recruited by Project DANTAK. Social security is important. Having that, we would not be talking about shortage of manpower in any sector.”

Past 11:45am, there is sign of the blocks getting cleared. The women sit on a pile of pebbles and open their packed lunch. However, happiness such as this moment is short-lived. Barely have they unfolded their simple ema datshi when news comes that there is clearing work to do.

The women climb on the back of a tripper truck and head towards Narphung.

Dzongkhag administration ready to continue Selela farm road: FM

ཉིམ།, 06/25/2022 - 15:28

Nima Wangdi

Finance Minister Namgay Tshering, during the question hour at the National Assembly yesterday, said that both the Ministry of Works and Human Settlement and Haa Dzongkhag Administration have surveyed and investigated the Selela farm road and the Dzongkhag administration is ready to continue the work if the alignment is finalized.

He said the people of Samar Gewog objected to the road construction at Etichito. They wanted the road to be constructed from Thangdokha to Setena instead of Selela to Setena. “We only need to decide which location the road to be built through. The Dzongkhag Administration is ready to build through either location, provided it benefits the people of both the gewogs equally.”



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Sombaykha’s MP, Dorjee Wangmo, said that the road construction was discontinued after the second government built 11km-stretch. The road from the two far-flung chiwogs of Samar, Setena and Phentena till Samar gewog via Selela, would be 35 Kilometres.

She said the two chiwogs currently are being connected with a farm road to Haa-Samtse highway. People travelling to Haa through this road have to travel 140 kilometers. “People want the farm road constructed at the earliest since it would cut the distance of travel to Haa significantly and benefit the public,” she said.

Dorjee Wangmo also said that the people of four chiwogs of Samar Gewog also own acres of lands in Setena and Phentena, which are being left fallow presently. “The farm road construction would help in recultivating the land left fallow.”

Lyonpo Namgay Tshering said that there was audit memo for the road construction.

Are petrol and diesel becoming dearer?

ཉིམ།, 06/25/2022 - 15:27

Gayleena Pradhan | Intern

Runaway price of fuel, especially diesel, has become the talk of the time. But are petrol and diesel becoming dearer? Are we paying the highest price?

The fuel price has jumped by about 90 percent compared to last June, but Bhutan is not the most fuel-expensive country. Petrol price is now Nu 100.34 per litre and diesel Nu 115.73 in the capital. At this price, it costs about Nu 3,511 to fill a family’s petrol Alto car with a 35-litre tank capacity and Nu 4,050 with diesel.

Among the South Asian Association for Regional Cooperation countries, fuel is cheaper here compared with Nepal. Nepal has the highest fuel prices in the SAARC region at Nu 124 per litre, 199 Nepali Rupee for petrol and Nu 119 for diesel as of June 23 which is 192 Nepali Rupee. Petrol is cheaper in Thimphu than in Mumbai, India, where a litre cost Nu 111.35. 



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Sri Lanka is in an economic crisis where fuel is in short supply. But petrol at Nu 91.05 and diesel at Nu 86.71 is cheaper in the island nation. Both petrol and diesel are also cheaper in Bangladesh.  A litre of petrol yesterday in Dhaka, Bangladesh was Nu 91.58 and diesel Nu 80.36 

In war-torn Afghanistan, petrol is at the 2020 Thimphu price with a litre costing only Nu 74.43 and diesel Nu 77.56 

Among the oil-producing countries, Iran (petrol- Nu 4.14, diesel- Nu 0.86) has the cheapest price followed by Kuwait (petrol- Nu 26.59, Diesel- 29.33) and Kazakhstan (petrol- Nu 31, diesel- 41)

It cost Nu 202 for a litre of both petrol and diesel in Norway. Norway has the most expensive fuel price among the oil-exporting countries followed by Ukraine (petrol-Nu134, diesel- 148) and the United States of America (petrol-107, diesel- 118). 



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Russia is currently selling fuel to its citizens at Nu 72 and Nu 75 for petrol and diesel respectively. Saudi Arabia is selling fuel at an even cheaper rate than that. That is Nu 48 and Nu 13 for petrol and diesel respectively.

Hong Kongers are paying the highest price in the world. It cost Nu 223 for a litre of petrol and Nu 216 for diesel.  This means it would typically cost Nu 10,035 to fill up a car with a 35-litre capacity. The fuel quality is also better in developed countries.

Cheaper than  bottled water

On the other extreme, Venezuela offers fuel to its citizens for less than the price of bottled water. A litre of petrol is Nu 2.34 and diesel Nu 1.716. Venezuela has the cheapest rate of fuel since it is home to some of the biggest oil reserves in the world.



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Even though the price of fuel changes constantly in other countries, Bhutan’s price changes bi-monthly as per the memorandum of understanding between Bhutan and India.

There are differences in the fuel price across the country due to the transportation charges. Bumthang has the highest fuel price (petrol – Nu 103.16, diesel- Nu 118.47) and Samtse has the lowest (petrol- Nu 97, diesel- Nu 112.59).

In comparison to February this year there has been a rise of Nu 21 and Nu 37 in petrol and diesel respectively.

Bhutanese swimmers exit FINA World Championship

ཉིམ།, 06/25/2022 - 15:23

Thinley Namgay   

Sangay Tenzin and Kinley Lhendup represented Bhutan in the ongoing 19th edition of the FINA World Championship 2022 in Budapest, Hungary.

Of the 209 FINA member nations, 184 are contesting in the championship that began on June 17.

Sangay Tenzin, 18, featured in the  100 metres (m) and 200m freestyle. Kinley Lhendup, also 18, took part in the 100m butterfly and 200m Individual Medley.



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In the 100m butterfly on June 23, Kinley Lhendup stood last among nine participants in the heat (group).  He completed it in 1 minute (min) and 4 seconds (secs). However, his performance was better in the 200m Individual Medley on June 21. He came sixth by finishing in 2 mins and 29 secs among nine swimmers.

Kinley Lhendup from Thimphu said, “I want to train hard to perform better.”

“Now, I need to focus on the upcoming Asian Games to at least get a medal and take aquatic culture of Bhutan to next level,” he said.

Meanwhile, on June 21, Sangay Tenzin came seventh in the 100m freestyle out of the eight swimmers in the heat. He finished the race in 57.6 secs.

In the 200m freestyle on June 19, Sangay Tenzin was last among eight participants. He completed the swim in 2 mins and 8 secs.



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Sangay Tenzin from Sarpang said: “It wasn’t a great competition for me.  I couldn’t  achieve my target but things cannot always go the way we want.”

“After the Olympics, I took a break and came back to Thailand to resume my training for this competition. I need to be more technical,” Sangay Tenzin said.

Sangay Tenzin and Kinley Lhendup participated in the 18th FINA World Championship in South Korea and the FINA Swimming World Cup in Russia in 2019.  They are training in Thailand through the support of FINA.

The FINA World Championship 2022 will end on July 3.

FCBL to close farm shops by this month

སྤེན།, 06/24/2022 - 10:22

Chhimi Dema

Thimphu dzongkhag tshogdu recently decided to write to the agriculture ministry after gups from highland communities expressed concerns about the closure of sanam tshongkhangs (farm shops).

Gups said the farm shops benefitted the highlanders access essential food items.

DT members said they will write to the agriculture ministry through their Member of Parliament (MP).

However, the Food Corporation of Bhutan Limited (FCBL) decided to close the 101 farms in the country by this month.

The farm shops were established in 2014 to provide buy-back facilities to the farmers and sell essential food items at affordable prices.



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According to FCBL’s annual report 2021, FCBL incurred a loss of Nu 91.17 million (M) in the past three years.

“The operating expenses are significantly high compared to the revenue generated by the farm shops,” it stated.

In 2021, FCBL spent Nu 36.90M on farm shops and incurred Nu 27.09M loss. FCBL incurred Nu 28.46M loss in 2020, and Nu 35.62M loss in 2019.

A report from the company stated that although the farm shop operation benefitted rural residents, its poor financial returns over the past six years incurred a loss of Nu 134M.



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“The recent review by an external expert also strongly recommended to close the farm shops that are not commercially viable,” it stated.

There are 119 operators in the farm shops, who were offered the option to take up the farm shop operation either on a franchise or in private retailing mode. Some shops had two operators.

The reports stated that 33 operators opted for franchise mode and two operators opted for private retailing.

The farm shop operators were provided with all entitled benefits and two months’ basic salary.



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FCBL’s chief executive officer, Naiten Wangchuk, said that the corporation, agriculture ministry and other relevant agencies studied the operation of the farm shops several times.

He said that considering the shops’ benefits to the rural communities, they were kept in operation for the two years of the pandemic. “We are looking into other ways to provide this service to the rural communities.”

More jobs less takers in Phuentsholing 

སྤེན།, 06/24/2022 - 10:19

Rajesh Rai | Phuentsholing

The Gowa program, the regional labour office in Phuentsholing conducted on June 22 brought together 22 companies and job seekers.

There were 299 jobs available but only 106 jobseekers turned up.

Of the 22 companies, 16 companies wanted to recruit “on the spot.” However, only four were recruited on the spot. Another 80 jobseekers were shortlisted for further interviews.

Labour officials said more than 90 percent of them will get jobs.



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Companies from Pasakha industrial estate, other manufacturing units and service providers floated salaries ranging from Nu 5,000 to Nu 24,000 a month. However, some companies had difficulty finding job seekers for recruitment.

Lhaki Cement advertised to recruit an electrician. However, most who came to inquire went back after they learned the workstation was in Gomtu. 

Empty chairs: 106 job seekers met with employers

“Only one came,” an official said.

The regional director of the labour office, Sonam Tenzin said it was a paradoxical situation.

“It is not that there are no jobs. There are jobs,” he said, explaining that youths have to take up those jobs.



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Most manufacturing companies look for skilled workers, mainly Technical Training Institute (TTI) graduates. A TTI graduate, Prem Kumar Gurung, 24 said he would take any job. The plumber was shortlisted.

Kezang Dawa, 26, is among those who were recruited. The class 10 graduate has been jobless for a year. He got a job with five others at Perfect Composite. 

“I am very happy.”

Kezang Dawa, who worked at a resort, lost his job due to the pandemic. He worked at the Mini Dry Port and construction sites.

A human resource official said they have been advertising to recruit for a long time. 

“We advertised so many times,” he said, adding nobody had come. “Today, we were able to recruit because we were able to interact and explain to them about the jobs.”



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Phuentsholing Thrompon Uttar Kumar Rai urged the jobseekers to take whatever jobs were available.

“We have to start small. That’s the first step to bigger successes,” he said.

NC19TF considering removing five-day quarantine 

སྤེན།, 06/24/2022 - 10:18

Nima Wangdi  

With the Covid-19 pandemic cases reducing, many say that there is no need for the five-day mandatory quarantine for those entering the country.

They said that the quarantine has become a burden for both government and the individuals.

A corporate employee, who recently returned from a week-long trip to India, said that the five-day quarantine is not needed. He said his expenses of Nu 1,800 a night and Nu 3,000 for two tests were borne by his office and the government. Yet he still felt it was unnecessary given the situation.

“If not for the Monkey Pox and some other Covid-19 variants that are drawing close to the country, quarantine is not required,” he said. The quarantine for those travelling within the country was discontinued a few months ago.



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The government pays the quarantine bills and test charges for those who are returning from medical treatment, and regular studies; those who travel for biometrics and the International English Language Testing System tests. People travelling for personal work have to pay for quarantine and the tests.

People arriving in Bhutan can choose either home quarantine or facility quarantine. Those who have unvaccinated family members at home go for facility quarantine while others choose home quarantine. Some also choose home quarantine since they can’t afford it or don’t want to spend on hotels.

Sonam Yangden, 30, who recently returned from Europe opted for home quarantine at her sister’s place in Thimphu. “Officials come for tests when we call them but no one comes to monitor me at home.”

She said that if those who are supposed to be quarantined at home are roaming around, the whole purpose of having the protocol in place is defeated.



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She said that the individuals should responsibly complete the home quarantine period with due diligence. “However, with the Covid-19 fading from memory, many don’t follow quarantine protocols seriously.”

There are talks going around about the government planning to do away with the five-day quarantine for the arrivals soon.

A medical doctor said that from the medical point of view the quarantine is unnecessary at this time.

National Covid-19 taskforce’s Chairperson, Health Minister Dechen Wangmo said that they are deliberating on the matter but there is no definite time as to when to do it. “We are looking at the data at the moment.”

Alcohol and Bhutan

སྤེན།, 06/24/2022 - 10:17

Now that the Cabinet has decided to allow restaurants to serve wine and liquor without requiring a separate bar licence, questions at the National Council put Health Minister Dechen Wangmo in a tight spot.

Lyonpo’s justification was at best threadbare.  While she said that the health ministry was concerned about the rising cases and financial burden due to alcohol liver diseases, it is hard to establish a link between easy access to alcohol and increased consumption. The argument does not hold water.

Our relationship with alcohol has been complicated. Addressing the problems and challenges related to alcohol so has at best appeared tentative. Some have even called for a total ban on alcohol in the country, which, unfortunately, won’t work. There are cultural aspects of alcohol to be considered. But that ought not to give us the excuse to not do something significant so that there is a sensible and much-needed regulation.

 Alcohol may be part of our culture but alcoholism and problems related to alcohol are not. They have never been. It is precisely this new and growing reality that should worry us. Implications, in the long run, will be costly. The direct cost of treating one alcoholic patient is estimated at Nu 122,000, contributing to the escalation of health care costs. And it is growing—with it social and economic costs.



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Because alcohol is one of the killers in the country, there is an urgent need to look at the destructive side of alcohol. We simply do not need more bars and alcohol outlets.

It’s a small consolation that studies and surveys will be carried out regularly which will give us a clear picture of the damage of alcohol to Bhutanese lives. Our hope is that politicians will rethink and rue their mistakes.

According to well-placed global research, people with alcoholism are up to 120 times more likely to commit suicide than those not dependent on alcohol—someone commits suicide every 40 seconds. This is also a serious problem facing the country today.

A recent survey found that in eastern Bhutan more than 58 percent of the respondents were alcoholics. In Thimphu, of the 36.4 percent of the adults who had consumed alcoholic beverages in the past year, 10.5 percent engaged in binge drinking. In rural areas, as much as 50 percent of the grain harvest of each household is used to brew alcohol each year. Underage drinking is also a serious problem.

Elimination of alcohol products altogether will not be possible. Our only hope lies in being able to limit or minimise consumption. This can be done.



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A research project to aid in policy decisions

སྤེན།, 06/24/2022 - 10:16

Chhimi Dema

A project, Bhutanese Knowledge for Indigenous Development (B-KIND), will begin in three focused dzongkhags to document and study the impacts of climate change faced by Bhutanese communities and find adaption strategies in consultation with policy-makers to benefit the communities.

The dzongkhags are Gasa, Punakha, and Wangdue.

B-KIND’s programme coordinator, Ritu Verma (PhD), said that the project carried out in rural communities would showcase people’s stories and everyday life experiences of climate change in systematic evidence-based research.

She said that the project would hold community consultations and document people’s needs.

After studying the socio-cultural practices and the biophysical conditions–based on meteorological data and other climate vulnerability assessments–the project would establish the impacts of climate change in these localities.



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Ritu Verma said that the project’s aim is to deepen capacities for evidence-based policymaking.

“If its [decision is] based on strong data and evidence, then it could benefit communities because it is based on their realities, which are double-checked through evidence,” she said.

The research project will provide training based on the community’s requirements and small action research projects.

The project held its inception workshop from June 16 to 17 to share project documents such as the research and data management plan; research ethics; monitoring, and evaluation of the project.

Ritu Verma said that the inception workshop allows the team from the two partner organisations, the Tarayana Foundation and the College of Natural Resources to share the status of the various themes of the project.



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The research project will focus on themes such as sustainable agriculture, climate change adaptation, gender equality and transformative change, indigenous knowledge, rural and international development, wellbeing and Gross National Happiness, and holistic food systems.

Ritu Verma said that the workshop assessed the project’s impact on communities and how the public can increase their knowledge about issues in these communities.

The project was launched on August 17 last year.

After its launch, Ritu Verma said, the project started setting up social media handles, buying equipment, and students who received scholarships through the project started their course work.

The project team conducted field visits and held community consultations with the farmers.



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In the coming months, the researchers with the project will make field visits to collect data and two students will leave in September to study in Canada.

Ritu Verma said that the project’s outputs range from researching and publishing articles in academic international peer-reviewed journals; hosting photo exhibitions, workshops and training; and making policy briefs.

The programme received a grant of approximately USD one million from the Government of Canada through the International Development Research Centre (IDRC).

Power tillers lying idle in remote Langchenphu gewog

སྤེན།, 06/24/2022 - 10:16

Kelzang Wangchuk | Jomotshangkha

Six power tillers issued by the then government, which are supposed to be busy in the fields at this time of the year, are lying idle at Langchenphu gewog in Jomotshangkha, Samdrupjongkhar.

The power tillers have been defunct for more than two years now.

This is because the gewog administration could not replace some parts of the power tiller.

A farmer, Kelzang Dorji, 66, said the power tillers helped the farmers for about three years during the paddy cultivation.

He said they didn’t even know what happened to the power tillers. “We reported the matter to an operator.”



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Another farmer, Tandin Wangmo, 40, said they hire the private power tillers during paddy cultivation at the moment because the gewog administration could not fix the government power tillers.

She said hiring private power tillers is expensive as they have to pay about Nu 1,500 to Nu 2,000 a day. “It would help us if concerned authorities could repair the power tillers.”

Villagers said although the power tillers were provided for public service, they could not reap much benefits.

“We don’t know whose responsibility it is to maintain and repair the power tillers?” a villager said. “Either the gewog administration or the Farm Machinery Corporation Limited should repair it.”

He said keeping the power tillers idle is a waste of state funds.



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Langchenphu gup, Guman Singh Gaylal, said they could not fix the power tillers because of the ownership issue. “The ownership is with FMCL and not with the gewog administration.”

He said the gewog administration tried to repair and fix the defunct power tillers but could not as they didn’t get the spare parts. “We have informed the FMCL to repair those power tillers.”

The gup said the gewog administration has no separate budget for the power tiller maintenance but only to monitor them. “It would help manage the budget if the FMCL could give us the ownership.”

FMCL officials, however, said two power tillers were beyond repair and lifted from the gewog and kept at one of the villagers’ houses.



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According to officials four power tillers were functional and deployed in the fields.

Officials said that they could not repair those two power tillers as they could not get the spare parts during the lockdown. “We would give the ownership to the gewogs if they want but under some terms and conditions. We would also provide additional power tillers if it’s required.”

NA to pass Tourism Levy Bill 2022 today

སྤེན།, 06/24/2022 - 10:15

… the money Bill after NA’s adoption today will be tabled at National Council this session

Tshering Palden 

The National Assembly yesterday agreed to all the provisions in the Tourism Levy Bill 2022. The House will vote and adopt the Bill today morning, which remains only a formality.

The members deliberated on the recommendations from the economic and finance committee, which was tasked to review the Bill after the first and second hearings on June 20.

The Economic and finance committee chairperson, Kinga Penjor reported that there was overwhelming support for the reform from across the sectors. “We consulted with many stakeholders and what became obvious was the support to the intent and the principles behind this reform,” he said.

Other members of the committee, and some from the Opposition Party echoed similar views.

The committee tabled only one recommendation, the other two being clerical changes.



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Section 6 of the Bill states, “Notwithstanding Section 4 of this Act, a tourist who had paid and confirmed the tour under the Tourism  Levy Act of Bhutan 2020 on or before 20th June 2022  shall continue to benefit subject to conditions imposed under Tourism Levy Act of Bhutan 2020 and Rules  thereof.”

The committee recommended that this consideration be extended from June 20 until December 31, 2022.

Kinga Penjor said that stakeholders in the tourism sector raised the issue of readiness in terms of resources and facilities. “Some even requested for an extension of two years which would be adequate for them to prepare and the resources to be ready,” he said.

He said that according to figures obtained from those in the tourism industry of 5,000 guides 3,115 were active.



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“Between September last year and this month, 27,266 tourists have booked their tours and many hotels and restaurants have availed of loans amounting to around Nu 48 billion,” he said.

He said that the committee after going through the evidence presented to them, mostly by those in the industry since the Tourism Council of Bhutan could not present any data, decided to recommend the change to the section.

Almost suddenly, the session that began with cordial bows and fist bumps erupted into a heated argument.

Opposition Leader Dorji Wangdi supported the recommendation. He said with the extension the hotels and tour operators would get some work while the government puts together necessary preparations and facilities. “Otherwise, the small window opportunity these businesses could be lost and hurting their livelihoods.”

Kinga Penjor said that those in the tourism sector told the committee that the TCB has not consulted the Bill with them.



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TCB board chairperson and Foreign Minister Dr Tandi Dorji said the TCB has been working for the past year on this reform.

“Guides have been trained and are still being trained. VISA approval would be done within a week and banking is also being eased to facilitate seamless transactions,” he said. “We’re ready to begin this September.”

Prime Minister Dr Lotay Tshering said that the Bill has taken into consideration the concerns of the stakeholders in the industry raised during the previous consultation meetings. “This Bill has the answers.”

Speaker Wangchuk Namgyel said that giving an extension until December 31, 2022 would mean having two Acts, the Tourism Levy Act 2020 and the Tourism Levy Act 2022, in effect at the same time which is not lawful.

More than a dozen MPs spoke for and against the committee’s recommendation. In the end, Speaker asked the floor to vote on the committee’s recommendation. The recommendation was rejected with only 13 MPs in favour of the extension.



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Bartsham-Shongphu MP Passang Dorji proposed a change to Section 8 of the Bill.

The section reads: “The Competent Authority may provide for an exemption or concessionary levy rate on the applicable Sustainable Development Fee, subject to any conditions prescribed in the Rules..”

He said that the authority to change levy or anything related to money was only given to the Parliament of which the executive is a branch.

Lyonchhen Dr Lotay Tshering said that since the Act would be passed by the Parliament the competent authority would derive that power from the Act. “If one looks at it from another perspective, there is no need for every such change to be routed through the Parliament.”

The House passed all five chapters of the Bill as tabled by the Finance Minister.



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Wangchuk Namgyel commended the committee for investing adequate time and scrutinising the Bill after exhaustive consultations.

He gave opportunity until the last MP who registered to speak and extended the session way past the time allotted to its deliberations and the tea break.

Other aspects of the Bill 

A tourist shall be liable to pay a tourism levy known as the Sustainable Development Fee of USD 200 per night, which may be revised by the Competent Authority from time to time.

The government will identify an apex agency as the custodian of the tourism policy which shall be responsible for the development, promotion and regulation of tourism in Bhutan.



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The increase in the SDF is also in line with Bhutan’s ‘High Value, Low Volume’ tourism policy. The SDF, however, has exemption on day tourists, who do not travel beyond the first designated point, five-year-olds and below, and children between six and 12 years would receive the concessionary levy rate of 50 percent.

The competent authority shall implement the provisions of this Act; license, register or certify tourism service providers; and regulate and monitor the quality of tourism services including hotels.  The authority has access to information, documents and the places of business of tourism service providers at all reasonable time by providing prior written notice to the service provider as may be required. It will also determine, promulgate and enforce requirements and code of conduct for all tourism service providers.

The Act will supersede all previous notifications, circulars, guidelines, rules and regulations on tourism to the extent they are inconsistent with the provisions of the Act.

ཤོག་ལེབ་ཚུ།