Nu 10bn trade deficit in first quarter of 2021

The balance of trade with India alone accounts for around Nu 9.9bn

The country’s trade deficit in the first quarter of this year, including trade-in electricity, is estimated at around Nu 10bn.

The balance of trade with India alone accounts for around Nu 9.9bn.

A country experiences a trade deficit or negative trade balance if its import bill is more than its earnings from export.

According to the provisional trade statistics for the first quarter this year, Bhutan imported commodities worth more than Nu 19.3bn, while its export value (including electricity) was recorded at around Nu 9.32bn. 

Compared to the first quarter of 2020, the trade deficit has remained more or less constant. A slight increase in imports was followed by a slight increase in export. 

Last year, the country exported goods worth Nu 41.8bn and imported Nu 69bn worth of goods. This could be largely due to electricity export.

Although the exact import and export figures may be known only at the end of the year, electricity generation during the first three months of the year (January-March) is usually low. This is why the electricity export earned about Nu 1,296mn in the first three months. 

The country also imported fuel in the same period, resulting in a serious deficit in energy trade. Diesel and petrol are listed as the top ten import commodities, the former being the top import product, valued at Nu 1.45bn. 

Rice also forms a huge component of import making it to the top ten list with more than Nu 500mn in the first three months of the year, an increase from Nu 400mn in the first quarter of last year. 

Bhutan’s top exports include silicon, which earned the country Nu 2.9bn in the first quarter this year, followed by boulder and cement worth Nu 1.4bn and Nu 533mn respectively. 

Figures show the country’s trade balance began deteriorating since 2013. 

The country experienced a trade deficit of Nu 18bn in 2020 against Nu 21bn in 2019. This slight improvement in trade deficit could be attributed to the increased earnings from electricity export. 

In 2019, the total imports were worth Nu 69.1bn and export was around Nu 47.48bn. However, last year, the trade balance decreased at Nu 18.8bn deficit, down from Nu 30bn in the previous two years. 

In 2020, Bhutan exported goods worth Nu 48.25bn and imported Nu 66.63bn. Had it not been for the electricity export, the country’s export value in 2020 was Nu 20.73bn, which could result in a trade deficit of more than Nu 45.7bn.

Meanwhile, the top import goods are from India worth Nu 16.56bn, followed by Thailand, and export goods to India worth Nu 5.4bn followed by Bangladesh worth Nu 2.2bn in the first quarter of this year.

Kinley Yonten from Thimphu