Low turnout in industrial estates amid loan moratorium
Time:2024-06-06 12:55

industry (1)

During the moratorium period, challenges in obtaining loans along with the impact of the pandemic led to a decreased number of entrepreneurs applying for loans across all industrial estates.

During a recent meet-the-press (MTP) session on May 30, the Minister of Industry, Commerce, and Employment (MoICE), Namgyal Dorji, said that the Department of Industry (DoI) was publicizing and extending invitations to entrepreneurs interested in occupying available spaces within all industrial estates and parks.

The Changchey Industrial Park (CIP) in Semjong, Tsirang, was established with an initial investment of Nu 52 million as part of the CSI Industrial Park initiative under the Startup and Cottage and Small Industry (CSI) development programme in 2020. Its operations were scheduled to begin by July 2021. However, little progress can be seen in its development today.

Lyonpo said that, presently, five CSIs were allocated plots within the industrial park. “Despite numerous announcements inviting applications, only seven new applicants at Changchey have received Provisional Letters of Interest.” Two of these applicants reportedly withdrew their applications, citing their unpreparedness to initiate their projects.

In 2021, there were originally nine plots dedicated to improving agricultural production. However, all nine businesses withdrew their proposals due to challenges arising from the loan moratorium and the pandemic.

“The new businesses faced challenges, particularly in obtaining food clearance certificates from the Bhutan Food and Drug Authority (BFDA),” Lyonpo said. “The DoI and BFDA have been working on the issuance of a provisional certificate for obtaining business licence.”

According to the proposals, the slots were allocated for various purposes, including manufacturing processed cheese and ice cream, processing meat (such as sausage and ham production, meat segmentation, packaging, and marketing), production of fruit juices using local fruits, and producing nutraceutical foods from organic raw materials.

Lyonpo said that plans were the same for industrial estates in other places. “The Dhamdhum Industrial Park, designated for clean-tech industries, and the industrial park at Norbugang for ferro-industries will see major changes in the 13th Plan.”

During the MTP session on March 29, Lyonpo said that the development of industrial zones in Dhamdhum was progressing through three sub-divisional phases: Phases A and B have already been completed, while the final phase, Phase C, is currently underway.

“In the sub-category, private entrepreneurs have already filled approximately 50 out of the total 77 slots; there are expectations for more slots to be occupied in the near future,” Lyonpo said.

At Norbugang, about 195-acre land has been designated for an industrial park. This area is intended to accommodate development of ferro industries.

“Samtse is planned as an industrial hub for its feasibility to work, export and market,” Lyonpo said. “The Gawadrong dry port is also planned to enhance its feasibility.”

To uplift the industrial parks at various locations, Lyonpo said that the government would continue providing business development support services such as capacity building, post-support services, access to infrastructures, and access to markets.

Government intervention with the Royal Monetary Authority and financial institutions, Lyonpo said, was necessary to ensure access to finance.

“Rules and regulations, guidelines and ease of doing business with policy reforms, as well as the need for the donor agencies’ support with establishment of foreign direct investment (FDI) viability, must be aligned to promote and develop the industrial estates,” Lyonpo said.

Bhutan is developing industrial estates in Chukha, Mongar, Thimphu, Samdrupjongkhar, Sarpang, and Samtse.


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