INR earnings from electricity is not enough to meet the import of essential items including fuel
Trade: If the import of essential items is anything to go by, then Bhutan is far from achieving its target of food self-sufficiency.
From Nu 6.8B in 2012, import of essential items shot up to Nu 8.05B in 2013 and Nu 8.9B last year.
At this rate, the country’s entire INR earning from electricity falls short to import essential items including fuel.
For instance, last year the country earned Nu 10.63B from sales of electricity to India while it imported fuel worth Nu 8.38B, leaving an INR balance of Nu 2.25B. Bhutan also imported Nu 8.9B worth of essential food items leaving an INR balance deficit of Nu 6.67B.
“If the country has to borrow this money at 10 percent interest, it could cost the government Nu 667M annually,” finance minister Namgay Dorji said.
According to trade statistics, Bhutan’s food trade deficit was Nu 5.2B in 2013. The deficit widened by 24 percent from 2012.
Cereal import has shot up from Nu 1.8B in 2012 to Nu 2.35B in 2013 and to Nu 2.6B last year.
Finance ministry officials said the recent case of fake rice imports to avail INR could have led to the increased import. Agriculture officials said rice import usually hovered around Nu 800M or around 50,000MT (metric tonnes) until 2011.
Meat import has also jumped from Nu 783M in 2012 to Nu 1.02B last year while the import of diary products has also increased by Nu 313M in two years. The country’s diary product import stood at Nu 1.28B last year.
Import of vegetables, fruits and nuts has also been increasing from Nu 550M in 2013 to Nu 639M last year.
The country also imported cooking oil worth more than Nu 1B last year, an increase of Nu 90M compared to 2012.
Besides, import of other essential items amounted to Nu 1.9B last year.
Meanwhile, Bhutan’s trade deficit with India last year stood at Nu 21.3B. The country imported goods worth Nu 56.8B and exported goods worth Nu 35.5B. Electricity and ferro-silicon is country’s top export commodities.