Druk Nelam

Comparative Price Analysis of Local and Imported Vegetables

2011-10-27T09:00:00.000+11:00

The comparative price analysis of the local and imported vegetable are for the period of March to August 2011. All the data was collected at the Centenary Farmers Market (CFM) branch office. The data compilation and analysis was carried out by Department of Agricultural Marketing and Cooperatives, Ministry of Agriculture Bhutan.

More Jobs Predicted for Machines, Not People

2011-10-25T11:17:00.001+11:00

[The "key to winning the race" is to make machines complements, not substitutes: More Jobs Predicted for Machines, Not People, by Steve Lohr, NY Times: A faltering economy explains much of the job shortage in America, but advancing technology has sharply magnified the effect, more so than is generally understood

Measuring what makes life worthwhile

2011-10-24T18:36:00.000+11:00

Talk by Chip Conley:

Some Challenges for Bhutanese Govt

2011-10-23T12:00:00.000+11:00

Source: Dorji, P (2011) 'Rural Toursim in Bhutan', working paper, University of New England

Source: extracted from
http://bhutan2008.blogspot.com/
2007/05/wangdiphodrang-
valley.html

"Urbanisation is becoming amajor challenge in Bhutan. Bhutan has arable land of only 7.8 percent (The World Bank Group, 2011), that cannot be extended because of its steep mountain terrain. Most of the arable lands are now forgone forurbanization. As the country develops, most of the arable lands are beingconsumed by town re-allocation and real estate boom. With little scope of comparative advantage inthe secondary sector of economy against India and China, except for Hydropower, urbanization posses a serious threat to the livelihood of the rural people.

GNH foundation

2011-10-09T00:24:00.000+11:00

The exogenous and endogenous factors for the formulation of concept of Gross National Happiness Model for Bhutan.

Source: Stefan Priesner (2006) 'Gross National Happiness - Bhutan's Visioni of Development and its Challenges' retrieved from http://www.bhutan2008.bt/ndlb/typescripts/10/

Economics of Technology

2011-10-02T23:44:00.000+11:00

Source: Tech-in-print

Technological growth has provided lots of advantages and opportunities in our day-to-day life. It has also contributed to the growth of economy within the society. Technology has increased efficiency and productivity thus increasing the output, both in terms of goods and services. Nations, organizations, companies and individual has gained a lot from technological advancement. It has also provided us with comfort and luxury. Due to this, we see lots of innovation. All around the world there has been increasing reliance on technology. In the world of limited resources, technological innovation has become necessity.

Do you need to know!!!

2011-09-18T00:33:00.002+10:00

During the period of The Great Depression in the 1929-39, where almost every house holds in US and Europe were literally brought on the streets, we didn't even know the world beyond India and China existed. In 1998, when there was Asian Financial crisis, we didn't even hear about it. Then came the Dot Com Burst in year 2000-2001, we just woke up at that time. After almost six years came the Great Financial Crisis (GFC), the result of it was countries almost went bankrupt, millions of people were left home less, millions of people were left job less and few landed up in prisons. The aftermath of the GFC can be still seen today, countries like Greece, Italy and Spain calling for bailout and US almost defaulting on its debt, this time it just passed us by.

The question is do you need to know all this stuffs? Does it have any impact on us? Well my view is that everyone should know what lies ahead. Next time when there is another financial crisis, Bhutan may find it self right in the middle of crisis. To understand the gravity of the situation please watch the follow four series of video of the Meltdown of GFC.

What is the solution for inflation in Bhutan?

2011-09-17T00:18:00.000+10:00

Source: Reason for Liberty web page

A friend of mine posted this question as her status on Facebook and apparently she is working with the Ministry of Economic Affairs.

My answer to the above is nothing (short term). The inflation in Bhutan is the result of inflation in India since almost every goods and commodities are imported from India. In most case, inflation is curbed with monetary policy and fiscal policy, however for Bhutan the two may not work for the following reasons:

Who is the 'economist'?

2011-09-10T23:17:00.000+10:00

In past few months, due to the economic turmoil all over the world there have been many economic concerns within the country as well. Inflation, recessions, credit crises, economic policy, etc are few examples to mention. Under such circumstance, our media has done well to cover the news and report to the public within their professional capacity and such a fine service is very much appreciated.

Marketing margin for Tourist rates

2011-09-08T16:03:00.000+10:00

In recent years, international people are increasingly interested in visiting Bhutan, however, due to the high rates there interest seems to be compromised. I was asked many times, why the rates was so high, i tired my best to break down the cost and explain the rational behind the high rates but it didn't seem like a enough explanation to them. In a survey conducted by Gurung et al (2008), a respondent (international tourist) made the following comments:

"I understand the principle, but wealthy people (especially westerners) are the most wasteful and least mindful of your resources, they are also often arrogant and so the Bhutanese people do not get to see the nice people that do exist in the west."

Tourism in Bhutan; Who benefits?

2011-08-27T22:35:00.000+10:00

Source: Tourism Council of Bhutan

Tourism in Bhutan is experiencing a major boom, even when the world was going through various economic crises such as Asian financial crises, Dot com bubble burst and global financial crises, there wasn't sight of decline in the demand for tourism in Bhutan. In 1996, total number of tourist was 5,138, in 2007 the number increased to 21,094 (Gurung & Seeland 2008)and in 2010 total number of tourist was 40,873 (Tourism Council of Bhutan 2011). Despite the our 'High Value, Low Impact' tourism policy, charging US$200 during peak season and US$165 during off season, statistics might suggest that the demand for tourism in Bhutan is inelastic to price.

Promotion of Domestic Markets

2011-08-22T01:55:00.000+10:00

Domestic market in Bhutan is very poor owing to various reasons. The two reasons that are worth highlighting are the attitude of consumers and marketing strategy of retailer.

Source: google, extracted from http://www.pigseye.com/hj/index.htm

Attitude of consumers: We the Bhutanese have a notion towards consumption of nominally cheaper products, I mean everyone wants to make best out of their limited financial resources but the argument is that ‘is the difference of price real or nominal’. As far as I am concerned I have been living in border area for years and what is prominent to me is that there is no real price difference between markets of Bhutan and India (border areas), of course when you move further into central and northern regions of the country the price appreciates due to various charges but individually every one would have to bear that cost even if they shop from India.

Sustainable economic growth for Bhutan

2011-08-12T23:50:00.000+10:00

I have been wanting to write on this tropic for a while so here i am. My article 'Pockets of the Giants' also talks on sustainable development strategy for our country and in this article i will talk about those that has not been discussed in my previous article. Dasho Karma Ura also talked about 'three tips for a healthier bhutanese society' in Business Bhutan, which are also very essential for our sustainable economic growth, it is not discussed here as well?

Following are some of the issues that i think is essential for sustainable growth of Bhutanese economy that are not covered in the above articles:

Better to invest than save???

2011-08-05T15:17:00.000+10:00

Did you read this article from Kuensel? Well what do you think? I'm very skeptical about it. How is it better for us to invest more when there is rise in inflation?

'Considering rising inflation and interest rates remaining fixed, Bhutanese economists say it might be economically better to invest, rather than keep money in the bank' Kuensel

When there is inflation in an economy, it means that price of goods and commodities in the commodity basket taken to measure CPI (consumer price index) has generally increased. That means we are paying more price for that particular commodity in comparison to what we used to pay few days/months/years ago. Generally when there is more inflation in an economy, it is a BAD SIGN, to much money in the market and to contain inflation, monetary policy is normally used by increasing real interest rates. By increasing real interest rates it would reduce investments and encourage savings, resulting in less money in the economy and lowering the inflation. This means it is not economically better to invest.

Wrong Plan

2011-08-01T23:28:00.000+10:00

source: www.CartoonStock.com

Another perfect example of improper planning carried out by the authorities reported by Rinzin, C. R for Kuensel(31 July 2011). Yet again we see similar plans and policies implemented over and over again.

Especially when the planning for infrastructural development goes wrong, it results is far greater cost than the initial cost of construction. The opportunity cost, sunk cost and the cost of maintenance in the future adds up to the initial cost. That is the cost of such mistakes are far greater than what it seems.

Mineral Development Policy

2011-07-31T14:59:00.000+10:00

Economic affairs minister Khandu Wangchuk reiterated what the prime minister assured saying that, when a country was looking at GNH and the inter-generational sharing of resources, a price had to be paid. “Probably the price will be for present generation to compromise, so the future generation will have these natural resources,” he said. “Nothing is free.” Samten Wangchuk reports for Kuensel (29 July 2011).

How far can our Minister for Economic Affairs justify the above statement? The answer should have been presented with the proposal, i mean the out come and benefits of the policy should have been highlighted with the proposal, if at all there was any. In fact following are some of the issues that should be given due consideration before providing any useless justification:

Central bank of India increases interest rate

2011-07-28T13:42:00.000+10:00

The Central bank of India has increased interest rate in order to curb with the rising inflation that is currently at around 10%. So is it good or bad for Bhutan?

Increase in the interest rate means increase in the cost of borrowing, that mean that we will get less expansion of business near our border or in the nearest town. This would result in lower economic growth across our border, which is already in an economic turmoil. For us the better and faster these places grow, better it is for us, both in terms of economic security and social security.

Real estate bubble: Thimphu and Paro

2011-07-12T17:01:00.000+10:00

Yesterday i was chatting with one of my friend and we were talking about various investment opportunities in Bhutan. She told me that it is good to invest on land in Thimphu and Paro, a topic on which i had reservation ever since i recall. Despite my intention of explaining the situation to her she still said that if i want to invest i should be investing on lands in aforesaid areas and as a matter of fact she wasn't the only one who told me that.

So here i am writing on real estate boom in Thimphu and Paro. As far as i am concern, the ever increasing price of land in these places has resulted in the spill over of sore of land price to places beyond the commercial areas, which is definitely also result of increased demand. There is no denying that there is a real estate bubble boom in these areas.

Misplaced priority

2011-07-04T16:23:00.000+10:00

In the national report, our PM has mentioned that Bhutanese increasing trend of buying motor cars was a misplaced priority. He addressed that owning a car was a sort of social competition among the population, which i believe is true but only to a certain extend because the entire population who bought cars or want to buy, doesn't do it to compete with its neighbours. It is to facilitate them self with a proper and safe mode of transportation.

Transport industry in Bhutan has lots of lapses despite the efforts from the respective ministries. The foremost lapses are the unethical nature of most of the public transport drivers. The reckless driving of the drivers, puts the life of passengers at risk for example the public transport from Thimphu to P/ling; the drivers drive the buses or taxis more speedily than most cars on the road, these drivers are experienced but not perfect. The time of departure for the buses are being monitored effectively but the arrival time is not being monitored.

Pockets of the Giants

2011-06-30T19:23:00.000+10:00

Asia's two rising giants, China and India. Although India is growing at a slower pace than China, both are growing at a pace, where most economies and economists of the world are left worrying, what would happen in the near future. Which bubble will they create and what would be the effects when that bubble busts? China is already showing signs of growth in housing bubble, which in future is likely to burst like any other bubbles.

Trapped between these two economic giants are Bhutan and Nepal, we are the pockets of the Giants. However, we have never been able to access to these huge markets, we have never been able to take advantage of it owing to various reasons. Some of the reasons are due to lack of natural resources (raw materials), lack of economies of scale and the geographical landscape limits the scope of using modern farming machinery. We have rather been another of their market, whereby almost all the goods and commodities are imported from these two countries.

Debt out of housing policy

2011-06-28T13:50:00.000+10:00

In Samtse, restriction on construction of houses has been imposed for more than past eight years by the authorities. The reason is mainly attributed to town planning and most of the houses that we see today are the houses that were built almost a decade ago.

Recently there has been increased number of people migrating to Samtse due to increasing economic activity and decentralisation of most public and private departments and offices.