The balance of trade with India alone accounts for around Nu 2.6bn
Amid growing imports, electricity is the only rescuer to narrow the country’s trade deficit. Reports of this year’s two quarterly trade statistics reveal that the country imported goods worth more than Nu 38bn against an export of Nu 15bn, leaving a trade deficit of about Nu 23bn until June this year.
If the electricity sale had not been for more than Nu 7bn in the first half of this year, the gap could have been even wider.
The country’s trade deficit in the second quarter of this year, including trade-in electricity, is estimated at around Nu 5bn.
The balance of trade with India alone accounts for around Nu 2.6bn.
A country, meanwhile, experiences a trade deficit or negative trade balance if its import bill is more than its earnings from export.
In 2019, the total imports were worth Nu 69.1bn and the export was around Nu 47.48bn. However, the trade balance decreased at Nu 18.8bn deficit last year, down from Nu 30bn in the previous two years.
In 2020, Bhutan exported goods worth Nu 48.25bn and imported worth 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.
According to the provisional trade statistics for the second quarter this year, Bhutan imported commodities worth more than Nu 19.3bn, while its export value (including electricity) was recorded at around Nu 13.8bn.
Compared to the second quarter of 2020, the trade deficit has remained more or less constant. A slight increase in imports was followed by a slight increase in exports.
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.
Among the top import commodities, petroleum products such as diesel and petrol dominate in terms of value. Until June this year, the country imported about Nu 3.9bn worth of diesel and about Nu 1.1bn worth of petrol.
The import of fuel is further aggravated by vehicle import, whose monetary value every quarter reached more than Nu 1bn, meaning that until June vehicle import touched about Nu 2.3bn.
The country also imported Nu 723mn worth of rice when efforts were put to achieve rice self-sufficiency.
In terms of export, boulders emerged as the top export commodity in the first quarter of the year with more than Nu 1bn in value. However, it dropped to third position with Nu 496mn.
Bhutan’s top exports include silicon, which earned the country Nu 7.9bn in the second quarter this year, followed by boulder and cement worth Nu 496mn and Nu 407mn respectively.
Figures show the country’s trade balance began deteriorating from 2013. But there is a slight improvement in trade deficit which could be attributed to the increased earnings from electricity export.
Meanwhile, the top imported goods are from India worth Nu 15bn, followed by Thailand, and export goods to India worth Nu 12b, followed by China worth Nu 2.1bn in the second quarter of this year.
Kinley Yonten from Thimphu