Project on Agriculture

The economy of Bhutan, one of the world’s smallest and least developed countries, is based on agriculture and forestry, which provide the main livelihood for more than 60% of the population. Agriculture is the primary source of livelihood for the majority of the people in Bhutan. Approximately 80% of the populations in Bhutan are involved in the agriculture sector and over 95% of the earning women in the country work in the agricultural sector. Agriculture in Bhutan is characterized by its labor intensive nature with relatively low intensity of farm inputs.

Major crops cultivated in Bhutan are maize and rice where 49% of total domestic cultivation is maize and 43% for rice. Agriculture in the country includes cultivation of wheat and other minor cereal crops. Paddy is the primary crop in those regions where proper irrigation is available. Apart from paddy, other crops like wheat, barley, oil seeds, potato and different vegetables are also cultivated in these lands. Maize is mainly cultivated in dry land regions at lower elevation. Forests are also responsible for regulating the availability of water for agricultural purpose.

Goals & Objectives of Agricultural sector “To intensify and diversify adopting an integrated approach in nutrient and pest management and achieve at least 70 percent self-sufficiency on the food grains”.   Ministry of Agriculture Based on the above statement the ministry of agriculture holds the following goals & objectives:   National Food security   Conservation of natural resources   Sustainable economic production   Enhancement of rural income   Social and Regional balance Role of the Agriculture sector

Agriculture in Bhutan has a dominant role in the economy of the country and is the largest sector in the Bhutanese economy. Some of the roles of the agriculture are as follows:

• Source of employment: Agriculture is one of the main sources of income for the Bhutanese since Bhutan is a developing country and depends mostly on the agricultural products. Agriculture sector provides has provided employment opportunity and will continue to provide for some more years.
• Contribution to National Income: National income is the total money earned within the country. In Bhutan, agricultural sector provides the majority contribution to the capital earned within the country. It comprises of one third Gross Domestic Product of our country.
• International Trade In spite of its remote and land-locked location, Bhutan has been relatively successful as an agricultural exporter. The value of agricultural exports has grown at an annual rate of almost 9% since 2000. Taking advantage of the cooler climate, Bhutan exports oranges, potatoes, vegetables, and apples to India and Bangladesh which helps in promoting international trade.
• Contribution to Government revenue: The tax collected through agricultural lands is one of the main sources of income for the government which in turn is used to protect the welfare of the people. Challenges faced by the Agriculture Sector Agriculture sector in Bhutan is facing problems undermining their growth and development. Though the Royal government is putting in great effort to develop and promote the sector it still faces some challenges as follows:   Natural calamities   Labor Shortage   Lack of marketing facilities   Social factors Agricultural Finance

Finance is the life blood of the agriculture sector and helps in enhancement of the agricultural production like in purchasing the fertilizers, pesticides, seeds, etc. In Bhutan there are financial institutions who provide agriculture loans in the form of short-term, medium-term and long-term funds. The financial institutions that provide credit to the farmers are:   Bhutan Development Bank Limited   Royal Insurance Corporation of Bhutan   Bank of Bhutan   Bhutan National Bank Industrial Sector in the Bhutanese Economy Bhutan is one of the least developed countries in the world.

Before 1960s, manufacturing was a household work and a few items like agricultural tools, weapons, handicrafts, wood product were produced on a small scale. However, after 1961, the number of industries expanded steadily. Nevertheless, industrial development experienced relatively in slow pace in Bhutan due to weak entrepreneurial orientation, high transport, underdeveloped infrastructure, etc. The industrial growth would enhance the living standard of the people and increase the rate of economic growth of a nation. In Bhutan the basis of industrial growth are “Sustainable Development” and “Gross National Happiness”.