Dissatisfied business community speaks finally

Published on Dec 22 2009 // Main News

BCCILogoDecember 22, 2009: Dissatisfied with the government draft of new economic development policy, especially allowing 100 percent foreign investment in certain sectors, Bhutan Chambers of Commerce and Industry (BCCI) has submitted a memo to the government compiling the list of its grievances.

Though the prime minister and the cabinet on August 5 had given assurances during an interaction to see into the issues raised by the business sector while preparing the economic policy, flowed by letter to that effect on September 26, nothing has been addressed so far.

The memo submitted last week has updated demands of the business community of the country, to incorporate them into economic policy already approved by the cabinet but not yet implemented.

Association of Bhutanese Industries requested that excise duty on raw materials be lifted and has raised concerns that the government needs to have more active consultation with stakeholders ‘as against the current superficial consultation process’. It has also requested financial institutions to give loans, not just based on collateral, but on cash flow, since the current system undervalues assets like land.

The association has also asked not to change in the current power tariff and demanded that government priority must be to provide electricity to Bhutan at minimum cost instead of exporting.

Association of Bhutanese Tour Operators (ABTO) has asked to do away with special permits, required from the department of culture, to visit already approved lhakhangs and dzongs, asked for consistent rules for dress codes for tourists.

ABTO said capacity of Druk Air must be increased, with more flight and destinations and an improved reservation system.

Construction Association of Bhutan (CAB) asked that professional consultants be hired to do detailed study on building the domestic capacity for hydro projects and also requested the government to formalize the compilation of a construction cost indices, used to measure cost escalation in contracts by mandating relevant organizations.

CAB suggested scrapping the rule to call for tender while doing contract for feeder and farm roads.

Hotel Association of Bhutan (HAB) sought permission for hiring skilled foreign manpower to operate hotels. Questioning allowing 100 percent foreign direct investment in four-star hotels, HAB recommended for increasing the minimum equity for FDI hotels from Nu 20 to Nu 200m. Introduction of online payments and credit card facilities in banks were its other demands.

Other demands raised by the business community include simplifying format for filing taxes for small and medium enterprises and the revenue and customs department has also been requested to create a platform to submit, discuss and resolve tax disputes.

Development of satellite towns, finalizing industrial estates and providing land for service industries and issuing guidelines are the additional issues raised. The tour operators on the other hand have expressed their dissatisfaction tot eh government decision to cut down the minimum levy charged for every tourist visiting Bhutan. Government last month had issued order to concerned authorities to determine new fees for Bhutan visitors, not lower than USD 65 revenue for government, with the aim to invite around 100,000 tourists per year to Bhutan.