Bhutan has better economic freedom compared to its neighbors

Bhutan is a land locked country and does not have a thriving economy still it topped other South Asian countries in the worldwide economic freedom ranking.

Bhutan came up with an economic freedom score of 57.6 points making it the 103^rd freest economy in the 2011 Index of Economic Freedom. In the Asia-Pacific region, the country is ranked 18^th out of 41 countries.

After Bhutan, Sri Lanka came up at the 107^th position with a score of 57.1 points and Pakistan 123^rd with 55.1 points. India was ranked 124^th with 54.6 points followed by Bangladesh at 130^th with a score of 53.0 points.

Nepal and Maldives were at the lowest at 146^th (50.1 points) and 154^th position (48.3 points).

This is quite surprising for a country like Bhutan. The first parliamentary election of the country took place in 2007. This is a great achievement for Bhutan government.

The economic freedom is measured by ten components comprising business freedom, trade freedom, fiscal freedom, government spending, monetary freedom, investment freedom, financial freedom, property rights, freedom from corruption, and labor freedom.

It is evaluated by the Wall Street Journal and the Heritage Foundation, two of the top economic organizations in the U.S.

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Bhutan Times

Small Development Programme of Bhutan approves more projects

Bhutan’s Small Development Programme (SDP) approved 641 small projects to people of 20 districts of Bhutan. The total cost of the projects is Nu 2.248 billion.

All the 641 proposals have been approved by the committee which consists of representatives from the foreign ministry, the Indian embassy and Gross National Happiness Commission (GNHC).

The projects focuses on farm roads, irrigation channels, construction of outreach clinics, construction of administrative offices and community centres, rural water supply scheme, drinking water sup­ply, toilets near BHUs, education centres, bridges, culture, and RNR centres and others.

SDP is India’s Nu 7 billion program grant aimed at improving the condition of rural people of Bhutan. It is part of the government’s 10th five-year plan of the Bhutan government.

Till date, 1082 projects have been undertaken by SDP. In FY 2009-2010, the committee approved 441 projects worth Nu 1.3 million. The first lot of Nu 394 million had been released in February 2010. The FY 2010-2011 will see the beginning of the second phase of the SDP.

Officials of Bhutan and Indian government are keenly overlooking the progress of the overall project. The administrative committee will meet shortly to consider more projects and set a budget ceiling of Nu 2.5 billion for the FY 2010-11.

At the National Assembly, Finance Minister said that the government used only Nu 195 million of the SDP fund about 2.3% of the grant.

Bhutan Observed Hike in Freight Charges due to New Restrictions

Because of the new restrictions imposed by the Supreme Court of India, freight charges from India to Bhutan would increase by 60-80 percent. The new restrictions will be implemented from May 21, 2010.

On April 30, 210, the Commissioner of transport in Guwahati and Assam published the notifications regarding overloaded trucks that would go through the national highway network.

The notification says that no overloaded vehicle should ply the highways even after paying their fines under motor vehicle act. Excess loads will be unloaded right on the spot after detection and the vehicle owner would have to bear all the responsibilities and cost of unloading.

The new law permits load of a six wheeler truck to 9 metric tonnes, 10 wheelers to 15 metric tonnes.

The Supreme Court actually passed the order in 2009 based on the appeal made by the National Highway Authority Of India and other parties that are working on building the four and six lane national highways across India.

The Supreme Court gave orders to all the surface transport authorities working in states all over India to stop overloaded vehicles from running on the highways. Contractors who are building the highway will be held responsible for their respective segment for a certain period of time. During this period, if they fail to meet the necessary standards, their security deposits will be forfeited.

The restrictions have been imposed to ensure the longevity of the roads, less emissions and traffic safety. However, these restrictions have not been fully implemented in Assam, West Bengal and some other states.

Bhutan government’s proposed reform upsets contractors

Bhutan’s contractors are not happy with government’s proposed reform to improve the country’s construction industry. Many fear that the new point-based evaluation system would encourage favoritism and corruption and would further delay the works of 10^th five year plan which was initiated in 2008 and would continue all the way to 2013.

Wangdi Gyeltshen, Executive Director, Construction Development Board, said that Construction industry is the oldest industry of Bhutan but it did not see much growth over the year despite getting maximum budget from the government. Hence, the reform has been introduced.

Wangdi Gyeltshen said that the new system would nil the possibility of making any “guesstimate” on the part of the bidder. Earlier, government officials used to reward projects to the contractors with the lowest bid but often they failed to complete the project in time. Under this new system, contracts would not be awarded based on highest or lowest bidding but to contractors who would come up with innovative and efficient systems to complete projects.

Officials of the Human Settlement Ministry said that the resistance to the reform came from a small group of contractors and none of them from the top construction companies in the country. In the last consultation meeting, about 55 participants appeared and there were no representatives from the top contractors of the country.