In a major boost to the government of India, the new Prime Minister of Bhutan, Lyonchhen Dr. Lotey Tshering, said his government is committed to strengthening the existing ties between Bhutan and India.
Speaking to India’s Foreign Secretary Mr. Vijay Gokhale, who was in Bhutan this week, Prime Minister Dr. Lotey Tshering said Bhutan and India share a “special bond of friendship and cooperation”. “Our foreign policy should not change every five years with change in government,” the prime minister said.
Dr. Lotey Tshering’s party, Druk Nyamrup Tshogpa (DNT), swept the polls on October 18 winning 30 of the 47 constituencies in Bhutan’s third National Assembly (Lower House) election. The new government officially assumed office on November 7.
Mr. Vijay Gokhale is the first high-level foreign dignitary to visit Bhutan after the election. He conveyed the warm wishes of the Prime Minister of India and assured Prime Minister Dr. Lotey Tshering of India’s continuous support to Bhutan’s development. The foreign secretary also conveyed Prime Minister Narendra Modi’s invitation to Dr. Lotey Tshering to visit India.
Mr. Vijay Gokhale last visited Bhutan in the first week of April this year.
Bhutan’s 12th five year economic plan
A brief post on the Facebook page of the Office of the Prime Minister of Bhutan stated that Prime Minister Dr. Lotey Tshering and Mr. Vijay Gokhale discussed Bhutan’s 12th Five Year Plan (2018-2023) and other developmental activities of mutual interest.
Since 1961 Bhutan has followed a five-year socio-economic development planning cycle. The five-year plans articulate the socio-economic development priorities that are implemented over a five-year period. The Indian government has continued to play a major role in financing the plans. In fact, India solely financed Bhutan’s first three five-year development plans.
According to Gross National Happiness Commission (GNHC, Bhutan’s equivalent of India’s Planning Commission), the total indicative outlay for the 12th Plan is expected to be around Nu. 310 billion, about 38 percent more than the 11th Plan (2013-2018) outlay. The Ngultrum is pegged to the Indian Rupee at par. According to India’s Ministry of External Affairs, New Delhi committed Rs. 45 billion for Bhutan’s 11th Plan. Additionally, another Rs. 5 billion came in as part of the Economic Stimulus Plan.
The two countries first discussed India’s scope of assistance to 12th Plan in New Delhi on 10 November 2017. The discussion took place during the annual India-Bhutan development cooperation talks and was co-chaired by Mr. Vijay Gokhale.
At least three new hydro-electricity projects are expected to be complete and commissioned in the 12th Plan. The new projects will take Bhutan’s installed generation capacity from 1,500 MW to 4,500 MW. The projects would contribute hugely to domestic revenues.
The 12th FYP is an ambitious five-year project. With the theme ‘A Just, Harmonious and Sustainable Society’, the Plan has identified a set of 16 national key results areas with corresponding key performance indicators. The draft went through multiple consultations with people from all parts of the country.
The Plan’s ambition also comes from its move for greater fiscal decentralization. According to GNHC, the 12th Plan has increased the capital allocation to the local government to 50 percent, up from 11th Plan’s 30 percent. This means resource allocation to the local government would almost double. Therefore, the local government will also see a greater decentralization of roles and functions in implementing the planned activities.
The 12th Plan conundrum
The Plan technically should have begun on 1 July 2018 considering the July-June fiscal year and the five-year cycle. However, the 12th Plan has not yet begun because of a number of minor complications.
With democratically elected political parties taking over the reins of the government since 2008, GNHC has started reviewing the winning party’s manifesto and public pledges to align them with centrally planned activities. The GNHC studies possible implications of the manifesto on the five-year plan and submits recommendations based on which the government acts.
The Cabinet then approves the Plan and presents it to the first session of the Parliament. Simultaneously implementation of planned activities begins.
However, the 12th Plan has not been approved so far although GNHC officials have aligned the DNT manifesto and public pledges to the draft Plan. It is expected to take another couple of months before the Plan is finalized. This means at least six months of the five years would have elapsed when the Plan is approved for implementation.
A similar conundrum was encountered when the Ninth Plan ended and the 10th Plan began. However, the GNHC leaves it to the government of the day to make the decision as to when the new Plan should formally begin. Technically, though, a five-year plan coincides with the elected government’s five-year tenure. By this rationale, the 12th Plan will spill over into the next government’s tenure in 2023.
Gopilal Acharya is the creator of The Talking Hills. He is an award winning journalist and has written for CNN, South Asian Monitor, The Straits Times, Scroll.in, The Telegraph, Kuensel, Bhutan Times, and The Journalist, among others. He is the author of Bhutanese Folk Tales (From the East and the South) and Dancing to Death (a book of poems). The manuscript of his debut novel, With a Stone in My Heart, was longlisted for the 2009 Man Asian Literary Prize. His poetry and fiction have appeared in Asia Literary Review and Himal Southasian.