Government and RMA looking to bring about radical policy reforms

Nidup Gyeltshen, Thimphu
Jan 4 2016

Both the government and the central bank are looking to bring about radical policy reforms with the financial sector looking relatively better. There have been with significant improvements in most indicators including reserve management and GDP.

One reform in particular could have direct bearing on those travelling for pilgrimage to India. Royal Monetary Authority will be opening six new counters in Thimphu and Phuentshogling where Ngultrum can be exchanged for rupees.

RMA’s governor Dasho Penjore said the new counters would cater only to Bhutanese pilgrims and not to traders and businessmen.

The Prime Minister and Finance Minister visited the central bank’s head office this morning where they discussed on the new rupee exchange counters. During the meeting, the central bank also handed over a cheque worth Nu 788M to the government.

The amount handed over to the government was mostly interest earnings made by the central bank by investing its foreign currency reserve in the international market. Earlier, the central bank did not declare any amount to the government for two years.

According to government officials, this additional revenue would likely be used to revise salaries of the Royal Bhutan police. The estimate for revision so far has worked out to Nu 300 M annually.

Prime Minister, Tshering Tobgay met with all the staff of the central bank and spoke on the importance of monetary policy. Lyonchhen said the RMA was an important national institute having direct bearing on economic development and social welfare.

Finance minister, Namgay Dorji after the meeting said, while reserve has improved, a major portion of the short term rupee debt has mostly been cleared except for the Rs 7 B borrowing from the Government of India line of credit, bearing a minimal 5 percent interest rate.