The government has declared 100 percent foreign direct investment (FDI) in the agriculture sector.
Full FDI in the sector aims to boost the production of six key commodities, namely mandarin, quinoa, rainbow trout, black pepper, asparagus, and strawberry.
This is a significant increase from the previous limit of 74 percent FDI.
The announcement was made yesterday at the inaugural session of Bhutan Agrifood Trade and Investment Forum (BATIF) 2024.
At the event, Lyonchhen Tshering Tobgay said that Bhutan must invest in modern technologies and adopt climate-smart approaches to enhance agriculture in Bhutan.
“Rugged terrain, climate change, human-wildlife conflict, shortage of farm labour and land fragmentation pose farming challenges. Yet, opportunities are equally compelling,” he said.
Lyonchhen underlined the feasibility of growing organic apples in Bhutan, developing a feasible market, and exportingthem to support smallholder farmers and entrepreneurs.
Minister of Agriculture and Livestock, Younten Phuntsho, emphasised the importance of embracing innovation, technology, and sustainable practices to achieve Bhutan’s vision of a modern, efficient, and market-oriented agri-food system.
“Most importantly, we need to harness the power of collective effort and collaboration,” he said.
Bhutan, lyonpo said, had the potential to reshape and transform its agri-food system, contributing not only to the nation’s food and nutrition security, but also to global efforts towards sustainability.
In the policy context, lyonpo said that Bhutan’s agrifood system was underpinned by a robust macro-policy framework, driving sustainable agriculture, food security, and economic prosperity.
Key policy documents, such as the Food and Nutrition Security, National Food System Pathways, and Low Emissions Development Strategy guide the efforts to enhance resilience and sustainability, all within the broad framework of GNH.
Industry Minister Namgyal Dorji stressed that investments in agriculture should empower farmers. He said that Bhutan already hosts several foreign investors, emphasising the potential for further collaboration to benefit farmers.
“The government will allow the employment of foreign expatriates in Bhutan without restrictions,” lyonpo said.
Today, there are approximately 8,000 smallholder farmers in the country. Lyonpo emphasised the importance of supporting them to achieve innovative, resilient, and sustainable outcomes in agriculture.
The contribution of RNR, the primary sector, to GDP, steadily declined from 38 percent in 1992 to 14.67 percent in 2022.
The sector employs 43.5 percent of the population in 2.75 percent of arable land.
Key focus
Bhutan aims to increase the agriculture sector’s contribution to GDP from USD 365 million in 2022 to USD 625 million by 2029, and USD 854 million by 2034.
Citrus production, for example, is expected to engage 5,000 households across 16 dzongkhags, resulting in an annual production of 28,800 metric tonnes (MT).
Quinoa cultivation is feasible in seven dzongkhags, with a target production of 2,360 MT a year, which can benefit 4,000 households.
Rainbow trout production is planned on 13 farms in three dzongkhags, with an annual production target of 72 MT.
Black pepper cultivation is feasible in five dzongkhags, and is expected to benefit 3,000 households.
Asparagus cultivation, planned in two dzongkhags, has the potential for 700 to 900 MT a year, engaging 2,000 households.
Strawberry cultivation is feasible in two dzongkhags and has the potential to benefit 500 farms with a production of 360 MT a year.
BATIF 2024
Six new products, namely mushroom tea, organic green and black tea, vermicompost, aiga processed cheese block, agarwood chips and oil, coffee plants sapling, and cherries collection were launched yesterday at the event.
Happening between May 15 and 19, the BATIF provides a platform for policymakers, entrepreneurs, and businesses to present investment opportunities to a wide audience, including foreign investors, multilateral development banks, and the private sector.
The event is organised by the Ministry of Agriculture and Livestock in collaboration with the Ministry of Industry, Commerce and Employment, the Food and Agriculture Organisation of the UN, the European Union, the Bhutan Chamber of Commerce and Industry, and various government agencies.
