BKP feels the need to rethink on the hydropower projects
Bhutan KuenNyam Party ( BKP) has stated that to avoid the probable occurrence of a black swan event, the government needs to pause and rethink whether there is an urgency to accelerate efforts in aggressive development of hydropower. While hydropower would remain an important component of our economy, Bhutanese should think about whether it is useful to pursue further development of hydropower – at great cost and risks to its citizens and ecosystem for pursuit of revenues, about which concerns must be confronted in terms of overdependence on one source and a single buyer. Or should we agree to take a staggered approach and learn from past experiences on all aspects of equitable social development, employment, macroeconomics, political economy and the environment.
In a press release issued by BKP it states that the government must analysis as to what benefit the Bhutanese people and the private sector has derived from the availability cheap hydropower in the country so far. With the commissioning of Chukha, Tala and Kurichu hydroelectric projects, Bhutan been able to put in concerted efforts in sharing socioeconomic benefits to the Bhutanese population. For instance, job creation for our youth, business development for the private sector, markets and townships for our dzongkhags. The hydropower development agreements should have policies and terms to create jobs for our youth not necessarily at production sites or during the construction period but whether an overall development agenda is in place to develop communities running a vibrant local economy as a spillover effect along the valley floors.
“With cheap power available in the country, has the development of Bhutanese owned industries in the southern border gained momentum on grounds of comparative advantage with potentials to create more jobs for the unemployed and additional revenues for the government so far has to be looked into.” the press release added .
At the end the 11th five- year plan our GDP to debt ratio is estimated to a record high of 111% with increasing disbursements of PHPA I & II and Mangdechu; not mentioning Nikha Chu and Kholong Chu projects. With 80% of loans accrued to hydropower, the government must be real sure that financial projections and business models ( financing schemes) will yield correct outcomes because past projections have not always been true. We must take valuable lessons from PHPA cost deviations from the actual estimates.
Bhutan Kuen-Nyam Party thinks, Bhutan should not have any urgency to develop new hydropower projects but rather pause to undertake some reflection before blocking another river. Instead prudent borrowings should be invested in sustainable job creation and private sector development, because ultimately it is the people of Bhutan who will have to pay off the liabilities and not any government.