Bhutan people should pay more if they want to become self-sufficient in rice production

A recent study conducted by the agricultural ministry’s Phub Dem, and Nicholas Minot of the International food policy research institute (IFPRI), concluded that in order to gain self-sufficiency in rice production, the people of Bhutan would have to pay Nu 75 per kg.

The study looks into the potential of agricultural trade of Bhutan. It discussed four major arguments against agricultural trade.

The study mainly used the example of rice consumption in Bhutan. Bhutan imports rice from India. Due to high production cost of rice, if the country wants to become self-sufficient in rice production then people would have to pay more for the rice. It said that price of locally produced rice would increase 2.5 times compared to the imported rice. Instead paying Nu 30 per kg, people would have to pay Nu 75 per kg of rice.

This may seem like a good reason for rice import but the study also said that importing crops would hurt local farmers.

Due to agricultural trading, many Bhutanese farmers are getting into producing export crops causing food insecurity by reducing domestic food production. The study disagreed with this argument saying that though land use for growing export crops is expanding but the effect is still negligible.

The study revealed that 4.9 percent of the cropped area in Bhutan is used to produce export crops. This would not have any major effect on the prices of the staple crop of the country.

Regarding the volatility of world food market, the study said that by becoming self-sufficient the volatility does not go away rather it replaces the volatility from the world market to the domestic market. Self-sufficiency is not the only solution to solve the problem of price volatility.