Limited access to markets is one of the major barriers to the growth of Cottage and Small Industries (CSIs) in the country, according to a Department of Cottage and Small Industries study.
The study, which was carried out in May, states that CSIs in the country are relatively unprepared and lack resources when it comes to taking their products to international markets. “There is an imminent need to establish a dedicated market outside Bhutan to gain access to global markets,” it states.
The feasibility of establishing CSI markets in countries that have imported substantial volumes of Bhutanese products has been studied, it states.
The study showed that it was feasible to establish CSI markets in Thailand, Bangladesh, the United States of America and Australia. The markets have been identified based on the value and types of CSI products exported to the countries in the last three years and the country’s diplomatic ties with them.
The study recommends selecting interested CSIs and establishing two CSI markets outside Bhutan within the 12th Plan.
Promoters of CSI products that have not been certified have been recommended to liaise with relevant agencies to get their products certified to be eligible for export in the international CSI markets.
The department is expected to bear the rental and hiring charges for the first six months, the cost of basic furnishings of the marketplace and the cost of shipment for establishing CSIs outside Bhutan in the beginning.
The department will also bear expenses on CSIs’ participation at trade fairs, trial marketing, standardisation and certification of products with Bhutan Standard Bureau and Bhutan Agriculture and Food Regulatory Authority, among other activities.
Agro-based products constitute 45 percent of the total CSI products exported from the country. Forest-based products, mineral-based products and handicrafts constitute 41 percent, 8 percent and 6 percent of the total exports respectively.
The study has identified kiwi juices, kombucha, yacon, sea buckthorns, yellow docks, alcoholic beverages, coffee, candies, local flours, handmade paper, shilajit, souvenirs and books as potential exports.
“The initial focus is on CSI products but the coverage may be widened to include all Bhutanese products based on demand, scale and quality in the near future. This would help diversify the visibility of authentic Bhutanese products in the global market,” the report states.
The report states that amid challenges at the domestic and international levels, the government has been making efforts to help CSIs enter international markets to reap the benefits of the global economy.
CSIs account for about 95 percent of the total industries in Bhutan. As of 15 June 2022, there were 26,945 active licensed CSIs in the country.