BoiC formally launched
The most contradictory, the establishment of the Business Opportunity and Information Centre (BOiC) and Access to Revolving Funds and Business Information Centre by the present Government on 19th December 2013 a time-bound autonomous agency, under the aegis of Ministry of Economic Affairs was officially launched on last Wednesday by the Prime Minister, Lyonchhen Tshering Tobgay and Indian Ambassador to Bhutan, His Excellency Gautam Bambawale.
With the launched of BOiC, those people wanting to start a small and cottage industry can now get loans from BOiC through the partner bank Bhutan Development Bank Limited (BDBL).
The total fund of Nu 1.9 billion under Revolving fund of the Economic Stimulus Plan, the BOiC will facilitate and provide access to funds under the revolving fund. The revolving fund has been divided into two parts, the revolving fund-I with the budget of Nu 1.5 billion for cottage and small manufacturing industries and in the revolving fundII with the budget of Nu 0.4 billion for non-formal rural activities.
Economic Affairs Minister, Lyonpo Norbu Wangchuk said, BOiC is not a silver bullet to all the economy challenges and the problems that we are facing but definitely it will make share of contribution to help us resolve these problems. The centre could think of a solution to correct the fundamental flaw of the economy that we are going through. The fundamental flaw could be that we imported more and export very little. This has given rise to all the problems that we have today.
Lyonpo said according to a global statistics, if we invest US $5000 in huge industries, it will manifest into one job, but in a small and cottage industries, if we invest US $ 150, it will result into one job. We don’t produce much but we just consume what was being produced across the border. Therefore, the focus of the BOiC is the production and manufacturing industries.
Lyonpo further added that, BOiC is all targeted to promoting small and cottage industries and the centre’s target is some 6000 jobs over a period of five years and that’s huge for a small country like ours.
During the press conference, CEO of BOiC Karma Tshering said, although they had received several proposals from the people including civil servant and the corporate employee, but they didn’t accept any proposal.
But after the launching of the centre, they will accept the proposal and evaluate accordingly, he added.
“Our objective is to take BOiC’s services to every part of the country and ensure people from far flung villages get access to the services without having to come to Thimphu. BDB is an ideal partner bank with very good network coverage and experience in rural, cottage and small business”, said the CEO
During the launched Prime Minister said, it is our pledges during our last election that we will establish the Economic Stimulus Plan (ESP) to solve our economy problems. The problems we are facing are with trade imbalance, youth unemployment, INR crunch, and we have the problems with the financial institution that they are unable to give the loans.
“Although the ESP will not solve all the problems but with this plan, the business people will able to get loan”, said the Lyonchhen.
Lyonchhen further added that, with RF, small and cottage industries and non-formal activities in rural areas could increased and more over, we can also help to those students who wanted to pursue their higher studies and to the retired civil servant.
Managing Director of BDBL, Pema Tshering said, “The objectives and mandates of BDBL to service rural, cottage and small industries in the rural areas conforms to BOiC as both the agencies have similar target groups. Therefore, this partnership of BOiC and BDB is an excellent collaboration and arrangement to deliver the financial services effectively and efficiently for the benefit of Bhutanese public”.
Chairperson of the BOiC and also the Economic Affairs Ministry’s joint secretary, Sonam P Wangdi said, although the BOiC don’t required any mortgage while lending loans but it is mandatory to have a guarantor.
He also added that, keeping the rate of interest at 4 percent, during the deliberation in fact we wanted at one-point in time and even not charge the interest, but we found that we need some incentive, but at the same time we need certain obligation. So this purpose would able to meet the basic cost. This is the lowest level we could go down to meet the cost both in terms of postfund services and to cover some of the over head cost of the BOiC.
Meanwhile, the Revolving Funds of Nu 1.9 billion will be managed in adherence to the fund management guidelines issued by the Ministry of Finance. The Ministry of Finance and the Royal Monetary Authority will manage and monitor the funds and the BDBL will disburse the fund.
Besides launching of the centre’s website and the business information centre, the compact agreement was sign between the centre and the BDBL.