Thukten Zangpo

Fifteen industries located in the old Phuentsholing Industrial Estate (below hospital) want the government to help them find a new place for their factories. They need about 20 acres of land to move their factories from the old industrial area.

The request came after Phuentsholing Thromde informed 15 industries in writing that it would not renew their lease for industrial land when it expires.

This is because the area is now classified as a residential and recreational precinct according to the revised Local Area Plan. Thromde wants to create a recreational area in the current industrial zone.

Among the 15 companies, four have their lease agreements expiring in 2024, five in 2025, and the remaining five in 2026. However, these companies can extend their lease agreements until early 2026. These companies have been operating since 1983.

The president of the Association of Wood-based Industries, Phuntsho Wangdi, said that the government has not yet identified a new location for the industries to move to. He also said that it would not be fair for the industries to have to pay for the costs of moving to a new place.

The industries also requested the relevant government agency, Ministry of Industry, Commerce and Employment to make some basic infrastructure improvements for an easier relocation process. This includes setting up power lines, water supply, sewerage system, and other essential facilities.

They also expressed the need for developing a detailed plan, or an action plan with a timeline, in collaboration with relevant stakeholders, including representatives from the affected industries. This plan would ensure a systematic relocation of these industries and assess the costs involved in relocation as well as any potential business or opportunity losses.

They said that relocating within just two years could disrupt their financial responsibilities, making it difficult to make timely payments to financial institutions, especially considering the ongoing economic challenges. Moreover, the businesses could face a decline in revenue and employment during the relocation process, which would negatively impact not only employees but also their families and the overall economy.

The 15 industries collectively generated an average annual turnover of Nu 864 million during the fiscal year 2018-2019 and provided employment to 586 Bhutanese. They also contributed to the national treasury through tax payments.

However, it’s important to note that these industries also have a combined financial liability of Nu 771 million.

The businesses involved in these industries engage in various manufacturing activities, producing a diverse range of products. These include block boards, plywood, furniture, fruit drinks, atta (wheat flour), maida (refined wheat flour), milk, polyvinyl chloride (PVC) cables, pet preforms, joinery, cardboard boxes, high-density polyethylene (HDPE) pipes, unplasticised polyvinyl chloride (UPVC) products, aluminum doors, and more.

Dralha Flour Mill, located in the area, is the sole flour mill in Bhutan and serves numerous manufacturing units, including bakeries, restaurants, and hotels among other essential industries like Bhutan Milk and Agro Private Limited, and Bhutan Salt Enterprise.

The industry representatives say that these industries not only strengthen the country’s self-reliance but also help mitigate  economic uncertainties, reduce dependence on imports and substitute imports.