Bhutan’s exports increase by more than 13 percent
Last Updated on December 7, 2024 9:37 am
Bhutan’s exports to India and other countries, including electricity, increased by over 13 percent as of September this year, compared to the same period last year.
Export earnings reached Nu 46.8 billion as of September, up by Nu 5.32 billion from last year. This year exports are expected to be more than the pre-pandemic level.
India continues to be Bhutan’s largest trade partner, accounting for 80 percent of exports, valued at Nu 37.38 billion. The remaining 20 percent export market includes Bangladesh, Italy, Nepal, and China, among others.
The growth of export revenue plays a critical role amid rising imports and diminishing reserves. The country’s export to India earns Indian rupee while it earns in USD for export to other countries.
Electricity exports to India, the major export, increased by 5.3 percent this year. As of September, 4,419.69 million units of electricity worth Nu 15.25 billion were exported, compared to Nu 14.48 billion during the same period last year.
While ferrosilicon exports, Bhutan’s second-largest earner, dropped from Nu 13.77 billion to Nu 11.07 billion, boulder exports increased to Nu 2.5 billion from Nu 1.61 billion last year. Dolomite exports saw a decline, falling to Nu 1.9 billion from Nu 2.68 billion in 2022.
Exports to Bangladesh, Bhutan’s top trading partner outside India, reached Nu 4.43 billion as of September this year. The key export items include boulders, mandarin, apples, cardamom, green tea, fruit juices, and other minerals.
Bhutan exports only ferrosilicon to Italy while gypsum, incense, tableware, among others are exported to Nepal. Exports to China include painting, handicrafts, ferrosilicon, and incense.
The 13th Plan highlights Bhutan’s limited integration into regional and international markets. Exports are constrained by infrastructure limitations, including a lack of market information, port and airport facilities, telecommunications and inland transport.
Given the high import and export costs, Bhutan’s logistics performance ranked second-lowest among South Asian nations in 2022.
Internal barriers include unreliable supply of electricity and other utilities, and slow progress in the simplification of customs and administrative procedures. External barriers include non-tariff barriers such as technical and phytosanitary measures.
With trade primarily confined to India and a limited reach to 27 other potential markets, the 13th Plan document recommended enhancing trade routes and logistics connections to expand export destinations.
Other recommendations include identifying and establishing new markets, strengthening bilateral, multilateral, and regional trade relations, and developing innovative export products and services. In addition, providing support for both new and existing industries, as well as facilitating intellectual property registration, will be essential to drive growth and competitiveness
To boost exports, the government has pledged to promote Bhutanese products through strategic marketing, establishing regional and international sales outlets, and improving export infrastructure. Plans also include regular cargo flights, cold storage facilities, and auction yards in the dzongkhags.