The House of Committees of the National Assembly (NA) has included the Economic Stimulus Plan (ESP) on the agenda for the upcoming Second Session of the Fourth Parliament. The Economic and Finance Committee of the NA is tasked with reviewing the ESP and proposing recommendations.
During a press conference held by the NA on November 8, Rinchen Wangdi, the chairperson of the Economic and Finance Committee, stated that the ESP is intended to help the economy recover from the effects of the COVID-19 pandemic. The plan was officially launched on May 19, 2024, supported by Nu. 15 billion in funding from the Government of India.
The chairperson acknowledged that despite nine months since the formation of the government, the ESP’s progress has been unsatisfactory. The Committee has consulted with the Cabinet Secretary, the Ministry of Finance, the Royal Monetary Authority (RMA), and the chief executives of the participating financial institutions. Findings revealed issues such as inadequate coordination, an incomplete Standard Operating Procedure (SOP), and a complex application process that had to be routed through the RMA.
The chairperson emphasized that training Community Service Center executives would simplify the ESP loan application process. Otherwise, the implementation of the ESP may be significantly delayed. “The ESP should be implemented swiftly to start generating income for the people if it is truly aimed at economic recovery,” the chairperson stressed.
In response to these challenges, the Economic and Finance Committee plans to propose several motions and provide alternative solutions during the parliamentary session. The Committee has prepared multiple step-by-step options to be presented if the primary solutions prove ineffective. The chairperson also noted that the Parliament aims to represent the public’s concerns, although the outcome of the deliberations remains uncertain until the session concludes.
At a “Meet the Press” session on October 11, the Prime Minister admitted that the ESP’s implementation was not progressing as expected. He highlighted that the government and financial institutions are working to resolve issues related to public confusion over the application process and eligibility criteria. Financial institutions have already received over 190 loan applications under the ESP.
A key initiative within the ESP is the Concessional Credit Line, launched on August 7, 2024, in Thimphu. This program offers collateral-free loans at a 4% interest rate to new and expanding businesses in sectors such as agriculture, livestock, small industries, and manufacturing. Additionally, a Reinvigoration Fund is available to provide interest subsidies, aiding businesses that are still recovering from the pandemic. Applications for this fund will be accepted until December 31, 2024.
The Nu. 15 billion ESP aims to boost domestic production, reduce youth unemployment, strengthen foreign currency reserves, foster new business ventures, and revitalize the tourism sector. The first tranche of Nu. 2.5 billion was disbursed by the Government of India to the Royal Government of Bhutan in May 2024, with funds allocated to various sectors, including agriculture, livestock, the creative industry, tourism, and the De-Suung Skilling Programme. Ongoing initiatives include the Price Guarantee Scheme for priority crops and livestock products.
Sangay Rabten from Thimphu
