Thursday, July 29, 2021
News

Better outlook for Bhutan economy in 2021: Fitch

   SocialTwist Tell-a-Friend    Print this Page   COMMENT

| January 5, 2021 12:43:08 PM IST
Bhutan's real GDP is likely to grow by 4.7 per cent in 2021, rebounding from a 3.5 per cent contraction in 2020, Fitch Solutions said on Tuesday.

An almost complete absence of tourism activity for 2020 crippled hospitality and transport services.

Manufacturing and construction were also affected during 2020 from disruptions to critical inputs, temporary export restrictions, foreign labour shortages (due to lockdowns in India), and weaker external demand.

However, a rise in hydropower output and exports due to the on-streaming of 720 megawatt Mangdechhu hydropower project likely cushioned the economy's decline.

"We expect somewhat of a reversal of the above trends in 2021, with tourism-related services, manufacturing and construction to aid the recovery," said Fitch.

"Hydropower output will stabilise without commissioning of another hydropower project, implying low growth. A weak pipeline of public infrastructure projects also suggests a limited rebound in construction despite an easing of foreign labour constraints."

Fitch said Bhutan remains effectively closed to inbound tourism as of January 2021 since the country's decision to shut its borders in March 2020 due to the Covid-19 pandemic. This has resulted in about an 88 per cent fall in tourist arrivals and revenue in 2020.

"With a global vaccine rollout underway, we currently assume that Bhutan will reopen its borders to international tourists by H2 2021, and this should accordingly drive increased activity for services, particularly hotels and restaurants, transport, and retail trade."

These three categories account for a combined 23 per cent of GDP.

Meanwhile, ongoing economic recovery in India will also support Bhutan's exports manufacturing sector, while easier movement restrictions smooth the flow of critical inputs.

India is Bhutan's largest trading partner, accounting for 80 per cent of exports and 84 per cent of imports. (ANI)

 
  LATEST COMMENTS ()
POST YOUR COMMENT
Comments Not Available
 
POST YOUR COMMENT
 
 
TRENDING TOPICS
 
 
CITY NEWS
MORE CITIES
 
 
 
MORE BUSINESS NEWS
Pandemic pushes digital payments, RBI in...
STL delivers Cloud-Native OSS/BSS soluti...
IMAC announces pricing of $200 million I...
Saraswat Bank donates Rupees one crore t...
JSW Energy enters into agreement with Au...
Now SEBI nails Raj Kundra and Shilpa She...
More...
 
INDIA WORLD ASIA
COVID-19 cases decreased fairly well in ...
Leaks claim OnePlus 9T won't be happenin...
Construction work of Rs 1500 cr National...
Mizo police not yet vacated disputed bor...
Transgender booked in UP for kidnapping ...
UP Police officer alleges casteist slur,...
More...    
 
 Top Stories
Olympics: South Africa stun Germany... 
Global cues, value buying lift equi... 
SC reserves verdict on Amazon's ple... 
Lok Sabha passes AERA Amendment Bil... 
Jagan misusing SC, ST Atrocities Ac... 
Israel to vaccinate elderly with 3r... 
Efforts on to help students to trav... 
1 person killed, 10 trapped in Turk...