Forex: The country’s rupee reserve has more than doubled in three months – from Nu 9.7 billion (B) in July to Nu 20.4 B as of September this year.

The rupee reserve held with the Royal Monetary Authority (RMA) has increased from Rs 9.1B in July to Rs 18.2B in September.  Like wise the reserves held with commercial banks have also increased.

Rupee with Bank of Bhutan’s (BoB) has increased from Rs 304 million (M) to Rs 1.2B during the same period. Bhutan National Banks’s rupee position has improved from Rs 29.4M to Rs 391.5M. T-bank’s reserve increased from Rs 68.7M to Rs 79.7M, and DPNB’s share swelled from Rs 216M to Rs 507.9M between July and September this year.

RMA’s director for foreign exchange and reserve management, Karma Rinzin said that the increase in country’s gross international reserves, including the rupee, from USD 932.4M to USD 1.14B could be attributed to inflow of grants and aid.

This was because whatever foreign currency the country received, be it rupee or USD, in form of grant, loan or hydropower earning, it is held with the central bank as reserve. However, equivalent amount of ngultrum was released for the particular activity.


But sources said that certain portion of convertible currency or USD the country receives in aid or grant today are straight away sold to buy rupee, reducing the rupee burden.

The standalone convertible currency reserves with the country also increased from USD 780M to USD 833M between July and September this year. Most of the hard currency reserve is from revenue the tourism sector earned.

“As of now, we are comfortable with the rupee position,” Karma Rinzin said adding rupees are made available to Bhutanese all the time.

With regard to the informal exchange rate taking place along the border, he said the central bank couldn’t exercise its regulations across the borders.

The new governor Dasho Penjore, in a recent interview said that should the country’s improved rupee position continue, exchange counters would be established at the border points to curb the informal exchange of the two currencies.

Today people buying goods from Jaigoan  pay between 15 to 20 percent more if the payment is made in ngultrum. There were also instances where people withdrew rupees from ATM machines in Jaigoan and sold it for higher rates.

Meanwhile, the country’s rupee reserve is enough to cover almost five months of merchandise imports, while convertible currency covers almost five years of merchandise import.

The Constitution mandates a reserve that covers 12 months of essential imports.

Tshering Dorji


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