Module Title: Bhutanese Economy

Module code:             ECR201

Programme:               BA Economics +, BA (Economics)

Credit Value:             12

Module Tutor:           Dr. Anil Dogra

General Objectives

This module aims to improve the student’s knowledge about the pattern of growth and development of Bhutanese economy since 1961, and emphasize upon strengthening the ability of the students to understand the impact of development planning in Bhutan.

Learning outcomes

After the completion of this module students should be able to:

·         Discuss the development process in Bhutan.

·         Demonstrate an understanding of the origins, functions and importance of Bhutanese's principal economic institutions and their significance;

• Develop an appreciation of why and the ways in which these institutions developed
• Assess the interaction between institutions to affect the regulation and functioning of the Bhutanese economy
• Develop the capacity to research, discover, and present information in a clear, concise, and literate manner in an essay-type assignment and examination.
• Critically analyze the magnitude of inequality and poverty in Bhutan and policies.   

Learning and teaching approach

Lectures/ Guest speakers (60 hours)

Tutorials (15 hours)

Seminars (25 hours)

Group Discussions / Debates (10 hours)

Case Study (10 hours)

Assessment

Semester end examination (50%)

Assignments (10%)

Term paper (25%)

Term Paper presentation in seminars (15%)

Subject Matter

1.      Nature of the Bhutanese Economy                                                     (12 hours)

Major features of Bhutanese economy since 1961. Objectives and strategies of planned development and the role of the state. Bhutan’s planning process. Structural and occupational changes since 1961- Rate, Pattern and structure of growth since 1961, change of share of agriculture, industrial and territory sector in national income.

2.      Agriculture                                                                                          (12 hours)

Factors influencing agricultural productivity –Role of Technology, Agricultural Credit, Marketing and Government Policies.  Industry: Industrial Policy. Rate and Pattern of Industrial Growth, Problems and Prospects of Industrialization, Role of Public sector and Private sector in the economic development of Bhutanese economy

3.      Financing of plans                                                                               (12 hours)

Instruments and role of internal and external resources finance, Rates of saving and investment. Role of international aid, and assistance. Banking and Finance: Royal Monetary Authority and Its Functions, Monetary Policy, Growth and performance of Commercial Banks and NBFIs. Role and Scope of Indigenous Banking and Micro Financing                                

4.      Demographic changes                                                                         (10 Hours)

Features of the changes in the size and quality of life of the population. Analysis of the report of Census 2005 (subject to update.)                                                                                                                           Poverty and inequality: The magnitude of inequality and poverty in Bhutan. Policies and programme to reduce and eradicate unequal distribution of income and eradicate poverty                                                                            

5.      International Trade                                                                             (6 Hours)

Composition and direction of International trade in Bhutan. Balance of trade and Balance of payment in Bhutan. International aid and external debt                                                                   

6.      Gross National Happiness                                                                   (8 Hours)

Bhutan’s developmental philosophy and Strategy for GNH.   Emerging economic policies: Economic Development Programme (EDP) Micro Small and Medium Enterprises (MSME), Co-Operative Act and Companies Act). Millennium Development Goals, Decentralizations of Decision Making: Role of DYTs and GYTs, WTO Issues and Bhutan.

Reading list

Essential Reading:

1. RGOB (2008-2013). Tenth Five Year Plan (2008-2013), Vol.1. Ministry of Planning
2. RGOB (2002). Bhutan (2020): Vision for peace prosperity and happiness. Ministry of Planning
3. RGOB (2010). Population and development situation analysis, Bhutan 2010, GNH (Research and Evaluation Division)
4. Annual RGOB (2012). National Account Statistics 1980-2012. CSO, Planning Commission

Suggested reading:

5. RGOB (2001). Household Income and Expenditure Survey 2000, 2003, 2007, 2009 (Pilot): Report on Income and Expenditure, Poverty Measurement, and Socioeconomic Profile of the Households, CSO, Planning Commission, Thimphu
6. Ghimiray, M. (1993). Comparison of Traditional and Modern Farming System in Bhutan. Background Paper, NEC, Bhutan.
7. BDFC (different years).  Annual Report on Agriculture Credit. Thimphu.
8. RGOB (different years). Selected Economic Indicators. Royal Monetary Authority
9. RGOB (different years); Annual Budget Report. Ministry of Finance.
10. Sen Gupta, B. (1999). Bhutan: Towards a grass-root participatory policy. New Delhi: Konark Publishers Pvt. Ltd.
11. http://ibscdc.org/Free%20Cases/Bhutans%20Gross%20National%20Happiness%20p1.htm
12. http://www.undp.org.bt/assets/files/publication/Macroeco_cs_for_Bhutan.pdf

(Updated June, 2013)