National Council adopts EIB

The National Council (NC) of Bhutan adopted the European Investment Bank (EIB) framework agreement on Wednesday.

Finance Minister Namgay Tshering introduced the Framework Agreement as an urgent bill to the NC on Tuesday.

Lyonpo mentioned that by signing the framework, Bhutan can have access to new concessional financing opportunities to meet the increasing development financing needs and also have more financing options after the graduation from the group of Least Developed Countries.

Lyonpo said that the council had objected to the Framework in 2015 justifying that the framework was not consistent with the country’s external commercial borrowings guidelines and might undermine Bhutan’s sovereignty.

He said that the government has worked tirelessly for the past one year with the Secretariat of the European Investment Bank on the objections of the National Council and, consequently, they have agreed and considered all the objections.

According to the National Interest Analysis report, Bhutan will have the advantages of access to financing sources; long maturity period; low fixed/floating interest rate; and increase of convertible currency reserve. However, Bhutan might face the challenges of exchange rate risk and interest rate risk.

The Foreign Affairs Committee presented the Framework Agreement between the government and European Investment Bank to the House for deliberation.

The Committee presented a total of 17 sections for deliberation and the House adopted all the recommendations of the Committee. The recommendations were mainly minor changes in the Dzongkha text of the agreement.

The Chairperson of committee, Member of Parliament (MP) from Tsirang Dhan Kumar Sunwar said the agreement was tabled as an urgent bill and the government has also rectified all the objections made by the council in 2015.

The House, with 18 ‘Yes’ and 5 ‘Abstain’ votes, from a total of 23 members present and voting, adopted the Framework Agreement. The Agreement will be submitted to His Majesty The King for Royal Assent.

Similarly, the National Assembly ratified the Convention on Framework Agreement between the government of Bhutan and European Investment Bank (EIB) Governing Activities in Bhutan with  42 ‘Yes’   and “4’ abstaining out of the  total  46 members present and voting.

The ratification of the convention through national interest analysis was found to be in the country’s interest.

Dechen Dolker from Thimphu