The country’s trade deficit declined by over six-billion-ngultrum last year compared to 2022. A trade deficit occurs when a country imports more than it exports. According to the finance ministry’s latest Bhutan Trade Statistics, the trade deficit reduced for the first time in four years after tripling since the onset of the pandemic in 2020.
The country’s trade deficit increased from over Nu 18bn in 2020 to over 32bn in 2021, and to almost 62bn in 2022. However, the difference between exports and imports dropped to Nu 55.5bn last year.
The reduction in the trade deficit has been attributed to a significant drop in the import bill following the continuation of the vehicle import moratorium and the suspension of commercial housing and hotel construction loans last year.
Import figures dropped from almost Nu 119bn in 2022 to a little over Nu 108bn in 2023.
Electricity made up the bulk of the total exports, last year, at over Nu 16bn, which is a drop of over Nu 6bn. Increased domestic demand for electricity has led to a drop in export numbers.
According to the central bank’s monthly statistical bulletin, revenue from domestic electricity demand increased by over Nu 2bn between 2022 and 2023.
Of the total trade deficit of Nu 55.5bn, over Nu 42bn is with India and the remaining with other countries.
The import bill, last year, comprised over Nu 13bn worth of diesel and petrol. Over Nu 3bn worth of rice, and Nu 2.2bn were spent on importing smartphones.
On the export front, silicon exports contributed to almost Nu 14bn in revenue.
Ferro-silicomanganese, dolomite, and boulder worth almost Nu 8bn were also exported.
India continues to be Bhutan’s largest export and import partner as trade with India accounts for over Nu 112bn.
Sherub Dorji
