India watching, Bhutan heads for runoff round of parliamentary polls

New Delhi: After the general elections in Bangladesh have been done and dealt with, Bhutan, another of India's neighbours, will hold the runoff round of parliamentary elections on Tuesday amid challenges of high youth unemployment and economic growth.

The two parties that have qualified for the runoff round from the primary phase are the People's Democratic Party (PDP) led by former Prime Minister Tshering Tobgay and the newly-formed Bhutan Tendrel Party (BTP) led by Dasho Pema Chewang, who had resigned as Secretary of the National Land Commission of Bhutan in November 2022.

The other three parties that were in fray in the primary phase held in November last year were the incumbent Druk Nyamrup Tshogpa (DNT) or Bhutan United Party, Druk Phuensum Tshogpa (DPT), and Druk Thundrel Tshogpa (DTT).

In the two-phase election system of Bhutan, the two largest parties emerging from the primary phase face each other in the runoff round. What has drawn the interest of observers is the sudden emergence of the BTP, registered only in January 2023, as a challenger to an established party like the PDP. The PDP was in power in the Himalayan kingdom from 2013 to 2018.

Despite its late entry into the poll fray, the BTP promptly took the lead by announcing a full slate of 47 candidates. In a short span, the BTP successfully assembled experienced candidates from diverse backgrounds, including politics, civil service, and business. The party conducted an extensive consultation campaign, engaging with various segments of society.

Now, what do the PDP and the BTP offer to the people of Bhutan?

The PDP has articulated its economic objectives, aiming to double the GDP from $2.5 billion to $5 billion and elevate the GDP per capita from $3,400 to $12,000 within the coming decade. Additionally, the party seeks to achieve full employment, reaching 97.5 percent in the next five years, generating an average of 10,000 jobs annually. This ambitious plan includes the creation of 2,000 jobs within the digital sector. Furthermore, the PDP aims to bolster private sector investment, aiming for a substantial increase from the current 40 percent to a robust 60 percent within the next five years.

On its part, the BTP aims to expand the size of the country's economy to $10 billion by 2034 from the current level of approximately $2.85 billion in 2022. It aims to propel Bhutan towards a high-income nation by 2034 and achieve economic self-reliance and promote an open and progressive economy.

So are these goals achievable?

Responding to a questionnaire sent by Bhutan's national newspaper Kunsel, PDP leader and former Prime Minister Tobgay said that his party’s manifesto isn't just a list of promises.

"It's a meticulously researched plan that has been extensively consulted upon and tailored to meet the genuine needs of our citizens," he said. "Our short-term pledges are aimed at mitigating the short-term needs of our society, while our comprehensive economic reforms, rooted in our manifesto, are long-term strategies to uplift the economy sustainably. We don't take these commitments lightly; they are a solemn promise to the people of Bhutan that we are fully dedicated to delivering on."

Responding to the same questionnaire, BTP's Chewang said that his party's approach to rebuilding the country's economy and achieving high income status is by adopting a strategy that unleashes the economic potentials of each household, chiwog, gewog, dzongkhagand the nation as a whole. For those in the dark, a chiwog is a basic electoral precinct in Bhutan, a gewogis an administrative division comprising a group of villages, and a dzongkhagrefers to one of the 20 districts of the Himalayan kingdom.

"This strategy is already in place," Chewang said. "However, we have pledged some special allowances to senior citizens, the differently-abled and vulnerable groups. These are investments we are making to uplift the lives of our vulnerable groups in the process of reducing inequality and an effort towards making our societies progressive."

Both the PDP and the BTP have committed themselves to the globally acclaimed Gross National Happiness (GNH) on the basis of which the government measures its success. The GNH is a measure of economic and moral progress that the country of Bhutan introduced in the 1970s as an alternative to gross domestic product. The four pillars of GNH are good governance, sustainable development, preservation and promotion of culture, and environmental conservation.

"Bhutan is an example of happiness, sustainability, and cultural richness," PDP's Tobgay said in his response to the Kuensel questionnaire. "We want the world to see us as a nation that balances progress with traditions, cherishes its natural beauty, prioritises the well-being of its people, and values the vision of our monarchs above all else."

On his part, Chewang of the BTP said: "We envision a prosperous Bhutan with a vibrant economy, a happy society and thriving communities where our values, tradition and culture are deeply entrenched, yet a modern society where innovation is impelled by enormous digital assets."

However, the reality today is that the GNH being affected by growing youth unemployment after the COVID-19 pandemic and a surge in emigration, Australia being the prime destination. According to a World Bank report in 2023, job creation in Bhutan outside of the public sector and agriculture has been limited.

"The lack of economic diversification and limited private sector activity pose risks to long-term growth and job creation," the report stated. "High unemployment rates since the COVID-19 pandemic, particularly among the youth, contributed to significant emigration. The youth unemployment rate, which was already high before the pandemic, stood at 29 percent in 2022."

According to the report, Bhutan's real gross domestic product (GDP) growth rate is projected to decline to 4 percent in financial year 2023-24.

"Overall growth is expected to be supported by higher growth in tourism-related services," it stated. "On the demand side, growth is supported by private and public consumption, reflecting higher government spending. However, public investment is contributing negatively to growth due to a decline in capital spending. Medium-term growth is expected to be supported by a recovery in the non-hydro industry and services sectors, and by the commissioning of a new hydro plant."

In this connection, the report also refers to Bhutan's relations with India. "Bhutan maintains strong economic and strategic relations with India, particularly as its major trading partner, source of foreign aid and as a financier and buyer of surplus hydropower," it stated.

"While hydropower has provided a reliable source of growth, non-hydro sectors, facing constraints related to the country's challenging investment climate including high trade costs and a small domestic market, remain less competitive. As a result, job creation outside of the public sector and agriculture has been limited."

However, whichever party comes to power this time around will have the opportunity to address these challenges following Bhutan King Jigme Khesar Namgyal Wangchuk's announcement last month of setting up a special administrative region in Gelephu bordering India's northeastern state of Assam.

The project envisages connectivity of Bhutan with South and Southeast Asia and the Bay of Bengal region. The announcement of the project coincided with with the concurrent development of a 57.5-km railway line linking Kokrajhar in Assam with Gelephu. The Rs 10-billion project, a result of discussions between King Wangchuck and Indian Prime Minister Narendra Modi during the former's visit to Delhi, signifies a historic milestone in rail connectivity between the two nations.

In fact, the manifestoes of both the PDP and the BTP have stressed on enhancing economic, connectivity and people-to-people ties with India. Both the parties have promised waiving the sustainable development fee imposed on foreigners for tourists coming through towns bordering India.

India finds mention in the PDP manifesto six times. Apart from the waiver of SDF, the party promises to establish an India-Bhutan office along the Indian highway to provide assistance to travellers and truckers in distress, including those involved in accidents. It also aims at establishing railway connectivity at Gelephu, Nganglam, Samtse, Samdrup Jongkhar, and Pasakha with the Indian rail links.

The PDP manifesto also promises to streamline the referral system and institute additional referral systems from Samtse, Mongar, Phuentsholing, Gelephu, Nganglam and Dewathang in Bhutan where patients can be referred to Siliguri, Bogaigoan and Guwahati in India. It also seeks to develop Nganglam, a town in southeastern Bhutan bordering Assam, into an economic hub.

"Bordering the Indian state of Assam, Nganglam is home to the country's largest cement plant - Dungsam Cement," the manifesto states. "Given its strategic importance, we will develop Nganglam into a thriving economic hub."

In its manifesto, the BTP, apart from promising to remove SDF on tourists coming through towns bordering India, stated that it will position mines and minerals as a key economic driver and mentioned India in this regard. It stated that the projection for income from mineral exports, including stones, cement clinker, limestone, dolomite, and gypsum to India and Bangladesh is substantial, with an estimated $19.968 billion from 2024 to 2041 and $2.4 billion from 2024 to 2028.

"Recognising the significance of the mining and mineral sector, we aim to reform the sector. The objective is to ensure a more equitable distribution of benefits among the people and the state, positioning mines and minerals as one of the five major economic drivers for the nation’s prosperity," the BTP manifesto stated.

Apart from economic cooperation and people-to-people ties, elections in Bhutan are of special interest for New Delhi as the Himalayan kingdom serves as a buffer between India and China. India and Bhutan share a long and porous border, and stability in the Himalayan kingdom is crucial for New Delhi's security concerns.

Bhutan and China do not share official diplomatic relations. China claims approximately 764 sq km in the northwestern and central regions of Bhutan. Initially, the dispute was part of border negotiations between India and China, but direct talks between China and Bhutan began in 1984.

However, the elections in Bhutan this time will be of special interest because of the latest border talks the Himalayan kingdom held with China in October last year.

An official statement issued by the Chinese foreign ministry following the negotiations read: "The conclusion of boundary negotiations and the establishment of diplomatic relations between China and Bhutan fully serve the long-term and fundamental interests of the country and nation of Bhutan. China is ready to work with Bhutan in the same direction, seize the historic opportunity, complete this important process as soon as possible, and fix and develop China-Bhutan friendly relations in legal form."

Elections in Bhutan hold substantial importance for India on various fronts. Beyond the diplomatic and geopolitical considerations, the democratic processes in Bhutan resonate with shared values of inclusivity and representation.

As India closely observes the outcomes of Bhutan's elections, it not only strengthens the bilateral ties but also reaffirms the commitment to fostering democratic ideals in the region. The peaceful and democratic evolution of Bhutan serves as a testament to the enduring friendship between the two nations and underscores the mutual interest in promoting stability, prosperity, and democratic governance across the South Asian landscape.