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Nima Wangdi

Graduating from the Least Developed Country group would have a minimal adverse impact on Bhutan as the country is ready, according to Foreign Minister Dr Tandi Dorji.

During the question session at the National Assembly yesterday, he said, “With all the arrangements in place, we should be comfortable until 2029.”

He said that the international support will continue for three years after graduation to help the country help with the transition.

Kengkhar-Weringla’s Member of Parliament, Rinzin Jamtsho asked the minister how prepared Bhutan was to graduate from the LDC category next year. The MP said that the people are worried as external aid and support could fall.



Lyonpo said that the grant and assistance at low-interest rates come from Asian Development Bank and the World Bank. They will continue as they have nothing to do with the graduation. “The two banks have considered Bhutan as a middle-income country since 2015 but they continued with the same support.”

“Official development assistance from other countries is just five percent of the GDP and any drop in it will not have a huge impact,” Lyonpo said.

According to Lyonpo, Bhutan receives support from only a few countries and mainly from India.  Graduation from the LDC group is not going to impact it. “We have signed agreements with Japan and the European Union. Their support too will continue till 2027.”

Lyonpo said that these countries provide support because the country has good relations with them, and not for being an LDC.



According to Lyonpo, there is evidence that the countries getting affected in terms of trade after they graduate. Since Bhutan is not a member of the World Trade Organisation, trade would not be affected too.

“Most of our trade is with India, Bangladesh and Thailand. We have strong trade agreements with them and it will continue.” Lyonpo said.

However, there could be a slight reduction in support from UN organisations. “But we will continue to get loans from Technical Bank and the UN Capital Development Fund’s assistance (UNCDF) for five years after graduation.” Climate finance might be reduced in future but it will continue for now.

“The graduating countries should have policies for the smooth transition. A committee and Gross National Happiness Commission have already made it ready to be incorporated in the 13 FYP,” Lyonpo said.



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