Ouch! The Rupee Crunch
The recent belt-tightening measures
announced by the Royal Monetary Authority, following the Rupee crunch, have
thrown a large number of Bhutanese people into a high state of anxiety. Unerringly
reactive, it was comical to see a huge number of Bhutanese people queuing up at
the fuel pumps - in an effort to top up their vehicle fuel tanks - proof that
they have not really understood the extent of our problems.
Regulating the outflow of Rupee isn’t going
to solve our problems - not even in the short term. However, it is a start. But
we need to go beyond that - we need to make some serious structural
adjustments. It is time for some hard decisions. It is time that we are
shameless about admitting that the pursuit of our past and present economic
polices, if there was one, need a 360° turn around.
While we tinker with our economic, fiscal
and monetary policies and redirect our focus to some fresh thinking and
perspective, an inconspicuous article in an obscure Blog may hold one among many
answers to the mystery surrounding the inexplicable Rupee crunch.
An article headlined "Food For Thought…..” in the Blog authored by K B Wakhley (http://www.kbwakhley.blogspot.com)
contains a strangely alarming and intriguing insinuation. He reveals that
the Bhutan Power Corporation Limited is paying the Indian contractors a
whopping Nu.37.08 million for every KM of the combined 159.1 Km of the two
400kV double-circuit transmission lines that run from Punatsangchhu-I
Hydroelectric Project site to the Bhutan-Indo border.
As corroborated by an Indian expert in an
email addressed to K B Wakhley, the cost of construction/installation of the
transmission lines should not exceed Nu.15.00 million per KM. As opposed to
that, the Bhutan Power Corporation Limited has paid a sum of Nu.37.08 million
per KM - more than one and a half times what it should cost us!
At first glance, overpayment on a project
component that represents merely 5% of the overall project cost should not be a
cause for concern. However, as I delved deeper into the issue, my thought
process enters the realm of the seriously bizarre and the whacky.
What, for instance, if the overpayment is
not an isolated case? In other words, what for instance, if we were to discover
that over-design and exaggerated costs are inherent in all of the hydropower
projects in Bhutan?
What, for instance, if we were to discover that the hydropower projects should
cost us less than half the current projections?
Besides other even more devastating implications
that boggle the mind, could it be that our much touted hydropower projects are
at the core of our Rupee crunch woes?
Ouch!
Indeed an eye opener on issues plaguing our small nation. A deeper analysis and investigative journalism may shed some more light. Politics seems to run deeper than we apparently thought. Please keep up enlightening us.
ReplyDeleteCurrently, this issue is running hot among Bhutanese people abroad. The news is indeed a surprising flash for all the people and more particularly for the business people and other management cooperating with Indians.
ReplyDeleteI hope the RMA investigates further to protect the consumers from failing to circulate their business as desired.
The news is really a thought provoking one.
Wish everyone in Bhutan stays calm with the uprising of new policies. God Bless!
"These are the times that try men's souls" so said Thomas Paine in seventeen hundred something. Of course the lay person have not even understood the problem; forget the extent of the problem. The ques at the petrol pump displays the simplicity of thinking of the Bhutanese people. It is better that the trying times are now rather than later. Hopefully there will be a getting together of heads to solve the problem rather than trying to blame the government for whatever is happening. It is better we suffer now for a stronger Bhutan for I believe adversity brings forth strength and courage. I suppose what is happening in the hydropower sector is the same that is happening in the ordinary construction industry world but just on a gigantic scale. Anon.
ReplyDelete