The Covid-19 pandemic battered the economy, affected businesses and livelihoods to the extent that people applied for the Royal Kidu. However, if the number of vehicles bought during the pandemic is anything to go by, there is a huge group that are not at all affected.
Since January this year, when the country started to feel the ripple effect of the pandemic, 3,386 new vehicles were registered with the Road Safety and Transport Authority (RSTA). Out of this, 324 vehicles were registered by organisations meaning the government or public corporations bought new vehicles. On the other hand, 3,062 Bhutanese bought new vehicles from January to June.
Records with RSTA show that 1,909 vehicles were imported after the first positive case of Covid-19 was reported on March 6. As of last week, 2,053 light vehicles belonging to private individuals were bought or imported. Out of this, 1,122 were after the first Covid-19 case in the country.
Compared with last year (between July and December), when businesses or livelihoods were not affected, import of vehicles or vehicles Bhutanese bought increased by four percent.
While details of who bought new vehicles when the country was going through a rough time are not available with authorities, many attributed the fiscal and monetary polices announced by the government. The government’s intervention to waive interests on all loans, many said, had helped a lot of people to invest in vehicles. Vehicles dealers have seen uninterrupted demand for new vehicles. Some, they said were ordered before the pandemic hit Bhutan.
“With people not having to pay the monthly loan interest, they could buy a new vehicle or upgrade,” said a corporate employee who is waiting for his new car, a Kia Seltos. A civil servant who sold his old Santor car to upgrade said that his import quota came in April. “It was my first and I didn’t want to wait to upgrade my old car that I had been driving for 12 long years,” he said.
Earlier this year, a policy review on vehicle imports presented by the Economic Affairs Committee of the National Council attributed the increase in vehicle import trend in the country to rise in income.
The review report stated that the per capita Gross Domestic Product (GDP)-used as a representation for income, in a span of 15 years from 2000 to 2015 increased from USD 743 to USD 3,360 which increased the demand for vehicles particularly passenger vehicles.
Another cause of growth in vehicle import is greater affordability. The combination of increased income and lower prices from the reformed Indian automobile sector led to the growth of import.
The review states that access to credit, urbanisation, and expanding road networks were some reasons for the increase in the import of vehicles. The report also found that a lack of efficient and reliable public transport in the country was a factor for growth in the import of vehicles. RSTA in the first quarter of this year registered 5,519 taxis in the country.
Meanwhile, in the past six months, 467 taxis were imported. Compared with figures from the same period of 2019, it is an increase of 22 percent.
The import of heavy and medium vehicles by private individuals, however, has dropped by 50 and 59 percent compared to months between July and December last year. This is attributed to the slowdown in economy and the huge non-performing loans. Likewise, the import of two-wheeler and earthmoving equipment by private individuals dropped.
But, the import of earthmoving equipment by various organisations across the country increased by 41.4 percent compared to the first half of the 2019-2020 financial year.
From 41 earth moving equipment imported by organisations this year, 31 were imported between March and July.
Within half a year, various organisations imported 170 light vehicles and 49 two-wheelers.