Government taking steps in bolstering agricultural export

Government taking steps in bolstering agricultural export

The Ministry of Agriculture and Livestock (MoAL) is making efforts to facilitate and enhance export of agri-commodities including vegetables to improve the income and livelihoods of farmers.

The MoAL minister, Younten Phuntsho shared that the ministry is facing several challenges in addressing issues related to vegetables export and exploring new markets. To address the issue, MoAL is planning to integrate facilities and target to double the export value from Nu 3 billion to Nu 6 billion.

The statement was shared by the minister when a Member of Parliament (MP), Phub Dorji, asked the minister on what interventions and measures has the MoAL been preparing to implement in order to address issues related to vegetable export and explore additional markets to find new buyers.

Lyonpo responded that one of the key initiatives is the establishment of potato integrated facilities at source, which is expected to help mitigate this issue relating to marketing and sale. “We plan to operationalize the facility in Gangtey this year and also started the construction of a similar facility in Bumthang which will be operationalized next year, with a plan to establish a similar facility in Khaling in the future.”

The minister said that noting the handful of buyers across the border town, market exploration has become a top priority, particularly for marketing of potatoes. The Ministry and Food Corporation of Bhutan Limited (FCBL) are putting in concerted efforts to explore additional markets in Nepal and Bangladesh.

The Minister said that in the past, the marketing challenges related to export of potatoes and vegetables were with regard to the payment of Indian Currency and absence of free trade agreement with Nepal. “Presently, the negotiation of a free trade agreement with Nepal is undergoing.”

The minister also highlighted that FCBL faces challenges in ensuring timely payments to farmers due to the significant volume of exports especially during the peak export season. To address the issue, the government has been providing an overdraft facility worth Nu 150 million to FCBL enabling timely payment to the farmers.

“However, the FCBL requires at least Nu 50 million extra for the period of six months (June–December), placing a substantial financial burden on FCBL. Therefore, the Ministry is exploring the possibility of providing additional Nu 50 million to FCBL to ensure timely payments to the farmers,” the minister said.

Another issue is regarding the Indian buyers registered with FCBL requiring them to make payments in Indian currency for the import. The minister said that considering the highly perishable nature of the agricultural products, FCBL solicits support from the government to make this an exception for the agricultural products and allow FCBL to accept payment in Ngultrum for at least two to three years as interim measures. “This will help to attract more buyers which would eventually result in competitive auctioning.”

To address the marketing process, MoAL and FCBL are also working on digitalization and adoption of AI technologies. The minister said that a proposal for developing an ‘AI Based Market Information System’ has been submitted to GovTech, which is currently under review.  The ministry has also initiated an online auctioning system since 2023, though the Auctioning has seen limited online bidders.

To minimize post-harvest loss, the ministry is working on improving the post-harvest management. In the 13th FYP, the ministry is also targeting to double the export value from about Nu 3 billion to Nu 6 billion.

In other development, MoAL facilitated linking local entrepreneur like Sibjam with Zenxin Organics in Singapore, which has led to the export of organic broccoli and asparagus every week. The ministry has also explored new retail outlets for vegetables export.

Additionally, a team from Elite Supreme Services visited Bhutan in September 2023 and had meetings with relevant stakeholders. Based on the discussions, two truckloads of potatoes were sent to Calcutta, India for new market exploration by Elite Supreme Services. The proprietor of Elite Supreme services also attended BATIF 2024 and is exploring possible collaborations with SOEs like BLDCL and FCB.

The minister also shared that they are also exploring other opportunities for investment in agriculture related projects with foreign companies like fair group and Pran RFL, Dhaka. The minister said, “These companies have expressed interest in importing trout, asparagus, quinoa and other vegetables from Bhutan.”

By Nidup Lhamo, Thimphu