Bhutan receives the largest share of Indian foreign aid with 61.60 Bn
With 63 percent of its share in total grants and loans, Bhutan received the largest chunk of Indian foreign aid with 61.60 Bn which includes 49.6 Bn for Plan Aid and 12 Bn for Non-Plan Aid. This was revealed during the presentation on Indian Budget (2015-2016): Opportunities for Bhutan in the capital last Friday which was organized by Embassy of India in Bhutan.
Indian ambassador Gautam Bambawale said during the presentation said that within the South Asia region, one of the value propositions that India has been making over the past several years to its entire neighborhood, it’s SAARC and outside bilateral was that all our neighbor must utilized and leverage the growing Indian economy for its own economy development and social progress.
“This is especially to our very close friend and very neighborhood Bhutan”, said the ambassador.
Naturally an Indian economy which is projected to grow by 7- 8 percent for the next three years and possibly faster represents a very big and huge opportunities. He added that, India will be investing in infrastructure as well as in manufacturing.
The services sector which also form a larger part of the Indian economy will also naturally developed rapidly in the coming years. Therefore, it will be natural that Bhutan can not only sale more hydropower and attract more tourist from India. Since Bhutan has the potential for organic production, Ambassador said that Bhutan should look for new sector which can be developed by Bhutan which there is unlimited demand by India.
“To increase agro processing such as in the form of jam, jelly, pickle and squash which have unlimited market demand in India. For instance, Druk jam is available in and around Delhi market but it is not available in Bombay, Chennai, Bangalore and Hyderabad”, said the ambassador.
He further added that, if Bhutan is able to increase its production of fruits and vegetable and expand the processing and bottling of these products, there is a huge scope for the sale of this item in India.
The chief executive officer (CEO) of Druk Punjab National Bank Mukesh Dave, said that focus has been more on economic growth and how the fiscal deficit is going to be connect, the economic growth in fact is now looking up because of the certain happenings in the past and by reduction in the current account deficit, reduction of the oil prices, control of inflation and all these measures has encouraged the figures of economic growth reaching up to 8.5 percent.
He said that they are also looking at budget for controlling the fiscal over spending; the public debt spending has been actually the norm in the past they tend to over spent.
For the all 22 items, the rates of basic customs duty on certain inputs, raw materials, intermediates and components have been reduced so as to minimize the impact of duty inversion and reduce the manufacturing cost in several sectors. This may result in reduction of the import cost for Bhutan, as a number of items included in the said list result in INR out flow, he added.
The CEO further added that there is a direct correlation with the measures and its impact on Bhutan and some other areas where impact on Bhutan can be indirect or can open areas of opportunities are excise and customs on petrol and diesel, reduction of indirect taxes, eases of doing business, emphasis on make in India and North-Eastern part of the country brought in the main stream.
He added that the launch of important infrastructure projects like All India Institute of Medical Sciences (AIIMS) in Assam and setting up of Centre for film production, animation and gaming in Arunachal Pradesh would benefit Bhutan.
“Any development in the bordering states is a welcome sign for Bhutan, for it provides business and trade development opportunities”, said the CEO.
The CEO said that the impact of the reforms initiated in the budget will take time to be visible but it can be seen as another positive forward step in strengthening of Indo-Bhutan ties.
Meanwhile, the Indian financial year will begin from April 1, but the impact will felt from June.