Mysterious Exports By Bhutan

When in 1984 I visited the USA, I asked a senior US government official if he knew where Bhutan was – he said YES - The Bahamas. Our isolation was so total that ninety five percent of the human population did not know where Bhutan was. And yet, unknown to most of the world and to the Bhutanese themselves, Bhutan has not remained too far removed from world events – we have been right there, and done it, in a variety of ways – since 1904. I am proud in the knowledge that few of the verses in the gargantuan book on human progression have been contributed by Bhutan, as minute as we are.

Today I would like to speak of one piece of history that very few Bhutanese would have heard about – Bhutan’s unknown but well documented exports of industrial goods running into millions of dollars.

This is a combined CO and GSP Form that seems to be current - during the early 1980s they were separate forms.

In the early 1980s, I was heading the Export Section of the Export Division of the Ministry of Trade, Industry and Forests. In my capacity as the head of the country’s exports, I had to attend some of the conferences and meetings on GSP (Generalized System of Preferences) conducted by UNCTAD (United Nations Conference on Trade and Development). During one such meeting, I was made aware of a number of records that listed items of export from Bhutan.

The list contained millions of dollars worth of exports by Bhutan – more that ten times the country’s GDP. And the items? - few thousand tons of sugar, manufactured bicycle parts and medical equipment running into hundreds of thousands of pieces. I was aghast – we did not produce/manufacture these items so how could we have exported them? I protested saying that there was some mistake – that as the head of the country’s exports I would be the first to know – and I know nothing of such exports. But the Meeting said that there are documentary proofs of the entry of the goods in the country of import and that there are signed Certificates of CO (Country of Origin) and GSP Forms issued by the RGoB based on which the Customs in the importing countries allowed duty free import of these goods.

This was very intriguing – it cannot be that there was some mistake at the port of entries in the importing countries. However, after many days of brooding over the matter I finally managed to untangle the mystery.

Obviously some Indian exporters saw an opportunity in what we were not exporting. So they exported the goods and filed the papers as Bhutanese exports. Why they would do that is because Bhutan as a LDC was given preferential treatment by some importing countries – our processed goods were allowed duty free import. How does this help? It helps because once the customs duty is removed – the importers get to import the goods at a much more competitive price than exports from other competing countries.

Many questions to this day remain unanswered: who in the RGoB issued the Certificates of Origin and signed and sealed the GSP Forms for those none-existent exports? How did the Customs officials at the port of exit accept Bhutanese documentation from Indian exporters? Or where the exports made by some shady Bhutanese companies - in cahoots with some Indian exporters?

We will never know - but it is obvious that the whole operation was a well conceived and thought-out scam!!