Important announcements were made in his State of the Nation report

The government will not only achieve but exceed most of the 11th Plan targets by the end of its period, the Prime Minister assured in his state of the nation report that was presented to the Parliament yesterday.

The most challenging part in implementing the 11th Plan was that the Plan was not finalised and required funds were not secured when the government took over.

“The government took it as a challenge and mobilised the required funds. In fact, the Plan size increased from the earlier Nu 209B to Nu 216B and later to Nu 221B to give in desired impetus to realise the Plan goals,” the state of the nation report stated.

To make matters worse, the report stated that domestic revenue was not realised as projected due to the delays in completion of three big hydropower projects. It had a revenue implication of about Nu 21B.

Despite this, increased Plan size was possible because of increased assistance from the Government of India of Nu 50B, including the Nu 5B economic stimulus package. The three-fold increase in assistance from the Japanese government and the European Union also played a crucial role.

Prime Minister Tshering Tobgay presented the ‘state of the TsaWa-Sum,’ the triple gem – His Majesty The King, the country and the people.

He said that the reason Constitution mandates the Prime Minister to present the report is to ensure good governance – accountability.

He reported to the Parliament that as of December 11, 2016, His Majesty The King granted over 132,177 acres of land to 112,749 people. In addition, 2,675 students have benefitted from His Majesty’s education programme for the underprivileged students under the Gyalpoi Tozey.

To put the concept of Gross National Happiness into practice, the Prime Minister announced that an international conference on GNH would be held this year. Under His Majesty’s command, Lyonchhen informed that GNH for business, a forum to synergise GNH and business would be launched on November 11 this year.


Rural advancement

“Progress can be measured and seen,” Lyonchhen said. However, he said that rural urban migration would continue if living conditions in rural areas were not improved.

While the Government aims to connect all gewogs with blacktopped roads, so far 89 gewog roads have been black topped. Gewog connectivity (GC)  roads in 71 gewogs are under construction, 66 are being blacktopped and 24 new GC roads will be constructed this year.

“On my gewog visits, people have told me that transportation cost for people and agricultural produce has become cheaper,” he said.

Lyonchhen acknowledged that building farm roads is easy, but maintaining them is difficult and expensive. The government, he said, has decided to provide an excavator and a backhoe to all 20 dzongkhags to maintain the roads.

From the tax exemptions provided to farmers to purchase utility vehicles, he informed that villagers have bought 3,239 Boleros in the past four years.

“Every village in Bhutan now has electricity. This year, 130 more households will be connected by grid,” he said.

This year, when 60 villages will be connected with cellular network, he reported that the country would achieve almost 100 percent cellular coverage.

He said that farm shops are transforming the economy of rural areas and that 51 more farm shops will be built. Starting this year the farm shop will start selling agricultural produce from the rural community to the urban centres.

Currently 65 gewogs have access to fuel outlets. This year Lyonchhen announced that 140 fuel outlets will be built in gewogs that would also supply LPG cylinders.

The report stated that 2,000 shops were granted business tax exemption amounting to Nu 68 million.

One of the continuing problems in rural Bhutan is water; for both drinking water and irrigation, Lyonchhen said.

To address this, he informed that a water Commission would be formed this year to develop a comprehensive plan to address the water problem and to ensure that all have safe drinking water by 2020.

Nu 358M has been allocated for drinking water and Nu 342 million for irrigation.

In the past four years, Nu 465M was spent in Thimphu alone to improve water supply. This year, an additional Nu 86M has been budgeted.

Lyonchhen also highlighted the need and efforts put in to enhance the road network in the country.

While the 28,299 civil servants are the backbone of the country’s socio-economic development, the Prime Minister acknowledged that a pay hike for civil servants is not possible until the mega-hydropower projects are complete. “I thank them for understanding the national needs against their personal ones. Nonetheless, the increase will happen as soon as we begin to generate more income.”

Salaries and benefits of Local Government members were increased to commensurate importance and responsibilities of Local Government, he said.

To ensure effective coordination, the government will meet Dzongdags and Gups once a year and DT Thrizins twice a year.

While the establishment of Dzongkhag Thromdes has been deferred till the Task Force of Supreme Court completes its study, the government has already finalised plans for all 16 thromdes. The government, lyonchhen said will proceed to develop Nganglam and Kanglung as hubs. To develop Nganglam as regional economic hub Nu 100M has been budgeted and Nu 150M has been earmarked to develop Kanglung as an educational hub.

The Second Parliament has passed nine laws and amended seven. The Prime Minister also announced that free legal aid would be launched this year.



Lyonchhen said that government debt is growing. Currently total debt is Nu 171B, of which most of the debt is for hydropower construction.

In the past four years, hydropower debt increased by Nu 69.25B, non-hydropower loans have decreased by Nu 6.4B, leaving behind non-hydro debt of Nu 34.5B.

Of the Nu 34.5B debt, Nu13B are commercial loans to BPC, BDBL, BHS and RMA. The government claims that actual government debt is only Nu 21.5B.

Lyonchhen said that the debt policy will make sure this government and future ones are not irresponsible.

The reduction of interest rates on loans from an average of 12.61 percent to 11.24 percent, lyonchhen said has benefited people by Nu 2.03B.

To enhance financial inclusion, government has decided that students will open bank accounts when they reach Class 11.

On the mining sector, the revised mining royalty rates have contributed to an increased domestic income by Nu 36M in the last six months.

In 2016, about 62,733 international tourists visited Bhutan bringing Nu 4.719B as revenue. Royalty fees that tourists paid amounted to Nu 72M. Regional tourists also saw a big increase from 97,584 in 2015 to 146,797 in 2016. “The increasing tourist number is good but we must work to not compromise on ‘high value, low impact’ tourism policy,” the Prime Minister said.


Social progress

The Prime Minister said that this year, the government would ensure that every BHU has at least one nurse to tend to the health of women.

He also announced that 189 patients have been airlifted to JDWNRH this year and that the government will provide Nu 500M to Health Trust Fund to help double the fund.

In education, he announced that the government has decided that all teachers must have a minimum of a master’s degree. Starting this year, the government will also not promote students to the next grade if they fail in Dzongkha.

On the cultural front, Lyonchhen informed that the construction of Wangduephodrang, Pemagatshel and Sarpang Dzongs are progressing well. Major renovation of Gasa, Trongsa and Trashigang Dzongs will complete next year.

The Institute of Zorig Chusum in Trashiyangtse will be upgraded to a college of zorig chusum next month.

Under the Rural Economic Advancement Programme, the government has provided assistance to 1,218 poor households in 75 villages spending Nu 150M.

The Prime Minister also said that unemployment issue grows as number of graduates increase. However, in the past four years, 60,000 youth have been placed in various jobs and training. “But we need to do more,” he said.

He said that today there are schools and hospitals in every part of the country and no Bhutanese have been left out of the mainstay economic growth and prosperity.

“We know that the pursuit of everything that we make is to reach that ideal place, Bhutan-pelri,” Lyonchhen said indicating that Bhutan should aspire to be a similar adobe  to that of Zangdopelri.

“I can justifiably and with pride say that Bhutan is near the ideal,” he said. “The question is are we ideal citizens?”

Tshering Dorji


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