Don't count your chicken

Published on Jul 15 2010 // Opinion
By I. P. Adhikari

The Bhutanese government expects steady double-digit growth for the next three years—the period the Thinley government will remain in power. The annual budget presented at parliament last week has projected growth based on expanding construction such as hydropower projects. The projection has not taken into consideration the negative impact of inflation in India. The internal market is directly affected by India, and inflation has been taking its toll there.

As speculated by the G20 leaders, another wave of global economic downturn is expected shortly. This will fuel consumer prices in India and thus have a direct impact on Bhutan. Additionally, increasing food prices in India will affect Bhutan which relies heavily on India for its food supply. The food dependence on India will heighten in the coming years as the construction of over a dozen hydropower projects will further reduce the area of agricultural land in Bhutan. When completed, these mega power projects will raise the national growth rate much higher, as high as 27 percent. This does not represent balanced growth of the country, considering the fact that it will not bring any changes in the lives of the common Bhutanese.

The other contributing sector for growth would be tourism. But the government’s decision to extort heavy levies from foreigners visiting the country will discourage tourism, thus thwarting plans to host 100,000 visitors annually by 2010. Over-publicity of the north-hill-Drukpa tourism will make Bhutan less attractive to old visitors.

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