The National Assembly yesterday decided to convert Rural Enterprise Development Corporation Limited (REDCL) to a Cottage and Small Industry (CSI) bank. The decision was made while deliberating on the Economic and Finance Committee’s recommendations on Review Report on National Budget for Financial Year 2019-20.
The committee’s chairperson, Athang_Thoedtsho MP Kinley Wangchuk said, REDCL was instituted to promote CSI by providing microlending activities for agricultural and production based projects. However, the committee observed that the major portion of the fund is directed towards processing activities compared to the manufacturing activities.
Finance Minister Namgay Tshering also supported the recommendation.
“People have been facing difficulty in availing themselves of loans from financial institutions. Towards this, we have all the supporting documents ready to convert REDCL to CSI bank. We will club the revolving fund from BDBL and REDCL to institute the CSI bank.”
The CSI bank will help with the development of agricultural and livestock activities in rural areas.
“Small business enterprises in rural areas are deprived of getting loans. Moreover, without such banking facilities, villagers are not able to keep their savings. Therefore, if such services can be made available in villages,” Draagteng_ Langthil MP Gyem Dorji said.
Some members also pointed out that the loan disbursement from the financial institutions is minimal which hampers the growth of agricultural productivity that ultimately contributes towards increasing country’s import.
Of the Committee’s 18 recommendations, the house endorsed 14 and did not support three. The three rejected recommendations are proper admission and scholarship guidelines in private schools for the students in class eleven and twelve, on the reinstatement of the recurrent and capital budget of the National Assembly of Bhutan and on budget allocation for the human resource from RGOB fund.
The Committee’s final recommendation to instate the Bhutan Chamber of Commerce and Industry (BCCI) as a Civil Society Organisation(CSO) was also not supported by most of the members of the parliament. The House, however, decided to discuss the recommendation in the winter session after a proper study.
The House today unanimously adopted the Budget Appropriation Bill for the financial year 2019-20 and the Supplementary Budget Appropriation Bill for the financial year 2018-19. All the 43 members presented in the house, supported the adoption of the bill. The total budget for the financial year is Nu 64.83bn.
From the total budget allocated for the financial year, over Nu 34bn will be used for current expenditure and while more than Nu 30bn ngultrum will go into capital expenditure.
The budget bill will be now forwarded to the National Council.
