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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.




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.




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.




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.

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