Twelfth Five Year Plan - Main Document

2015 Paris Agreement. having strong pro-environmental beliefs as compared to urban. A large majority As a country located in the ecologically fragile of the population reported that they feel Eastern Himalayas, Bhutan is vulnerable ‘highly responsible’ for conserving the natural to impacts of climate change. With a environment. majority of the population dependent on agriculture, and the economy heavily reliant on hydropower and tourism, climate change has serious implications for Bhutan’s socio- economic development. 7 TWELFTH FIVE YEAR PLAN VOLUME - I 8 CHAPTER 2 BHUTAN’S DEVELOPMENT JOURNEY 9 TWELFTH FIVE YEAR PLAN VOLUME - I 2.1 GNH-Our Development Figure 2.1: Percentage contribution of sufficiency Philosophy of each domain to overall GNH Index, by area Gross National Happiness is the overall guiding development philosophy of Bhutan. The concept was first expounded by His Majesty The Fourth Druk Gyalpo when His Majesty enunciated the visionary statement that “Gross National Happiness is more important than Gross Domestic Product,” in an interview with the Financial Times of London in 1986. Over the years, GNH has not only guided Bhutan’s socio- economic development but has also gained wider international recognition as an alternative model of socio-economic development. The Source: GNH Survey 2015 Constitution of the Kingdom of Bhutan mandates the State “to promote those conditions that will Since the 10th FYP, GNH Index and the findings enable the pursuit of Gross National Happiness”. of GNH surveys have been used to guide plan formulation and monitoring. The 16 National Key 2.2 Operationalisation of GNH Result Areas (NKRAs) of the 11th FYP were framed based on GNH. The GNH survey findings of 2010 The operationalisation of GNH was made were also used to develop some of the 11th FYP through policy and legislation during the reign key performance indicators. Continuing the past of His Majesty The Fourth Druk Gyalpo. Since efforts to operationalise GNH, the 17 NKRAs of 2008, indicators and tools have supported GNH the 12th FYP were formulated guided by the nine implementation. domains of GNH. The GNH Index score was also an important determining factor for allocation of 2.2.1 GNH Index resources to the Local Governments (LGs) in the 12th FYP. The GNH Index was introduced in 2008 to measure our progress towards maximising 2.2.2 GNH Policy Screening Tool GNH. The Index is comprised of nine domains- psychological well-being, health, time use, The GNH policy screening tool assesses the education, cultural diversity and resilience, impact of introducing a new policy on GNH, good governance, community vitality, ecological specifically whether the policy is GNH favourable diversity and resilience, and living standard. The or not. It is a tool with 22 variables representing nine domains include both conventional aspects the nine domains of GNH on a scale of 1-4 (1 of development such as standard of living, health representing negative impact, 2 uncertain, 3 no and education as well as unconventional aspects negative impact, and 4 positive impact). For a such as psychological wellbeing, community policy to be GNH favourable, a minimum score vitality, cultural diversity and time use. Three of 66 is required. Till date, 26 draft policies have nationwide GNH surveys were carried out in been screened using the tool and 15 policies 2010, 2015 including a pilot survey in 2007-2008 were approved during the 11th FYP. to develop Bhutan’s GNH Index baseline and assess progress. 10 Figure 2.2: Absolute change in GNH Index between 2010 and 2015 across dzongkhags Source: GNH Survey 2015. Note: *** statistically significant at 1%, ** statistically significant at 5%, * statistically significant at 10%. 2.2.3 GNH Index in Resource 2.3 Key Development Allocation Formula Milestones The GNH Index score has been used for the Bhutan follows a five year planning cycle that first time in the 12th FYP as one of the criteria outlines the socio-economic development to determine resource allocation to the LGs. A priorities and programmes to be implemented Dzongkhag, Gewog or a Thromde with a lower over a period of five years. The inception of the GNH Index score receives higher allocation of Five Year Plans in 1961 marked the beginning of resources. The weightage for the GNH Index planned socio-economic reforms in Bhutan. The has been set at 10 percent for Gewogs and table 2.1 provides a summary of objectives, total Thromdes and 15 percent for Dzongkhags. allocation, priority areas, and major milestones achieved during the past FYPs since 1961. 2.2.4 Other Applications Other areas under development include the GNH business certification, cost effective analysis, project impact studies and cost benefit analysis for major projects. The lead agency for formulation and implementation of these tools is the GNHCS and the Centre for Bhutan and GNH Research. 11 TWELFTH FIVE YEAR PLAN VOLUME - I Table 2.1 : Overview of the Five Year Plans Plan Main Goals Outlay Outlay Domestic Revenue (Nu. Million) Growth as % of Outlay Development of basic infrastructure. 107.2 - - 1st FYP (1961-66) Build on the foundations laid in the first 202.2 88.8 % 1.1% plan. 2nd FYP (1966-71) Improvement of agriculture and livestock 475.2 135.0 % 6.9% production, social services. 3rd FYP (1971-76) Balanced regional development. Setting up small and medium scale industries. Concentration on growth of agriculture, 1,106.20 132.8 % 5.4% livestock, forests and small industries. 4th FYP (1976-81) Economic self-reliance. 4,711.20 325.9 % 28.2% Sustained rate of growth. (1981-86) Greater distributional equity among 5th FYP regions. Participatory planning. 12 Priorities Main Achievements Roads- 66% Construction of 1,770 kms of roads: Education- 8.8% • Phuentsholing to Paro and Thimphu. • Samdrup Jongkhar to Trashigang. Roads- 40.8% • East-West lateral highway construction from Haa to Trashigang. Education- 17.66% • 102 schools established. Agriculture- 10 % • Teacher Training Institute-Samtse established. • Hydel at Thimphu, Paro & Wangduephodrang completed. • Detailed investigation for Chukha Hydropower Projected completed. Agriculture- 22% • Food Corporation of Bhutan established. Roads- 19.79% • Opened for tourism with establishment of Bhutan Tourism Corporation Ltd. Education- 20% • Received 287 tourists in 1974. Power & Mining-12% Health-8% Agriculture – 23.5% • Investment in major projects such as Chukha HEP, Penden Cement and Industry and Mines -15.8% Gelephu irrigation scheme. Education- 12% • Participatory planning initiated through the institution of DYT. Public Works-11.6% • First Broadcast Station established. Forestry-10% Industries- 22.7% • Chukha Hydropower commissioned in 1986. Power-22% • GDP-Nu.1,673.2 million. Power Sector- 16.5% • GDP per capita in 1986/87– Nu. 2,123. Public Works-14.2% • Tax revenue increased from Nu. 65.1 million (1981/82) to Nu.173.8 million Agriculture-13.3% [1986/87]. Education-4.1% 13 TWELFTH FIVE YEAR PLAN VOLUME - I Plan Main Goals Outlay Outlay Domestic Revenue (Nu. Million) Growth as % of Outlay Achieve economic self-reliance. 9,559.20 102.9 % 49.9% Improve governance through organizational development programmes. Rural development. 6th FYP (1987-92) Consolidation of development programmes. GNH based development. 15,590.70 63.1 % 60.9% Economic development and self-reliance. 7th FYP (1992-97) Living standard and quality of life. Decentralisation. Balanced and sustainable development. 30,151.30 93.4 % 68.8% Decentralisation. Institutional strengthening. 8th FYP (1997-02) 14 Priorities Main Achievements General Public Services-21.6% • Domestic revenue met the current expenditure for the first time. Agriculture-15.6% • 2,674 kms of road completed. Transport & • 90 percent of the population provided access to health care. Communication-11.7% • Immunisation coverage 84%. Education-10.9% • Gross primary enrolment rate 70 percent achieved. Powwer-9.6% • GDP(average growth) – 4.1 %. Public Works-8.9% • Infant Mortality Rate (per 1,000)– 142. Mining-6.6% • Maternal Mortality Rate (per 100,000) -770. Health-5% Health & Education-22.7% • GDP-Nu.12,249 million. Communication – 17.3% • Life expectancy –66 years. Agriculture- 15.7 % • Infant Mortality Rate (per 1,000) – 70.71. Finance-12.7% • Maternal Mortality Rate (per 100,000) – 380. Trade & Industry-9% Health & Education-17.7% • GDP-Nu.24,293 million. Power-15.7% • Kurichhu & Basochhu (upper)Hydropower Project commissioned. Finance-14% • Infant Mortality Rate (per 1,000) - 60.12. Agriculture-12% • Maternal Mortality Rate (per 100,000) - 255. Roads-11.8% • Net Primary Enrolment Rate (NPER) – 62 %. Communication-10% • Poverty rate – 31.7 %. • Life Expectancy – 66 years. 15 TWELFTH FIVE YEAR PLAN VOLUME - I Plan Main Goals Outlay Outlay Domestic Revenue (Nu. Million) Growth as % of Outlay Improve the quality of life and income. 70,000.00 132.2 % 64.6% Enhance good governance. Promote private sector growth. Preserve and promote culture. Environmental conservation. 9th FYP (2002-08) Accelerate economic growth. Poverty Reduction 145,625.00 108.0 % 60.0% 10th FYP (2008-13) 16 Priorities Main Achievements LGs- 24.5% • GDP-Nu.52,100 million. Communications- 14.8% • Tala & Basochhu (lower)Hydropower Project commissioned. Trade & Industry-12.2% • First National Population & Housing Census conducted. Agriculture-6.5% • GDP (average growth) – 9.6 %. Health-6.4% • GDP per capita –USD 1,414. Education-3.7% • Life expectancy –67 years. Finance-2.3% • Infant Mortality Rate (per 1,000) - 40.13. • Maternal Mortality Rate (per 100,000) – 215. • National Literacy Rate – 59.5 %. • Net Primary Enrolment Rate (NPER)– 88 %. • Poverty Rate – 23.2 %. Finance-20.74% • GDP-Nu.111,352 million. LG- 18.7 % • GDP average growth) – 8 %. Works & Human • GDP per capita (2009) – USD 1,851.66. Settlement-12.99% • Transitioned to Democratic Constitutional Monarchy. Education-7.1% • Druk Phuensum Tshogpa elected as Government and People’s Democratic Agriculture-5.5% Party as Opposition Party. Health-5.86% • Life expectancy years-68.1 years. • Infant Mortality Rate (per 1,000) - 30. • Maternal Mortality Rate (per 100,000) – 86. • Literacy Rate –63%. • NPER – 96%. • Poverty Rate reduced from 23% to 12 %. • GNH Index –0.743. 17 TWELFTH FIVE YEAR PLAN VOLUME - I Plan Main Goals Outlay Outlay Domestic Revenue (Nu. Million) Growth as % of Outlay Self-reliance and inclusive green 223,657.00 53.6 % 63.0 % socio-economic development 11th FYP (2013-18) 18 Priorities Main Achievements LG- 28.82% • GDP-Nu.164,628 million Finance-19.35% • GDP (average growth)-5.59 % Works & Human • GDP per capita – USD 3,438 (2017) Settlement-11.06% • People’s Democratic Party elected as Government and Druk Phuensum Agriculture-6.4% Tshogpa as Opposition Home & Culture-5.5% • Recommended for graduation from LDC status Education-3.92% • Second National Population & Housing Census conducted Health-3.82% • Life expectancy – 70.2 years • Infant Mortality Rate (per 1,000) - 15.1 • Maternal Mortality Rate (per 100,000)– 89 • Literacy Rate – 71.4% • NPER (Primary) – 94.7 % • Poverty Rate – 8.2 % • GNH Index –0.756 19 TWELFTH FIVE YEAR PLAN VOLUME - I 2.4 Five Year Plans and the 11th FYP. These goals were prioritized on the Sustainable Development Goals basis of urgency to address issue of poverty reduction, to fulfil Bhutan’s commitment to In September 2015, Bhutan together with the remain carbon neutral at all times; and to global community adopted “The 2030 Agenda for champion and show-case Bhutan’s success in Sustainable Development Goals (SDGs)” at the preserving its biodiversity. United Nations (UN) headquarters in New York. Given the similarities between our development Similarly, preliminary assessment of the 12th FYP philosophy of GNH and the SDGs, alignment of NKRAs and Key Performance Indicators (KPIs) SDGs with our FYPs did not pose a challenge. with the SDGs reveals high degree of alignment. A rapid integrated assessment conducted by The 17 NKRAs are closely aligned to the SDGs UNDP in October 2015 indicated high level of and their targets and indicators are integrated integration of the SDG targets with 11th FYP. Out into the 12th FYP. of 143 relevant SDG targets, 134 were found to be included in the 11th FYP. Bhutan presented its Voluntary National Review Report for the first time at the High Bhutan is also amongst the first few countries Level Political Forum at the UN Headquarters that began early implementation of the SDGs in New York in July, 2018. Bhutan remains since its adoption in 2015. While all 17 Goals are committed to implementing the SDGs and will important, Bhutan prioritized three SDGs (Goal 1 continue to closely monitor progress on SDG – No Poverty; Goal 13 - Climate Action; and Goal implementation in the 12th FYP. 15–Life on Land) for implementation during the Table 2.2: Alignment of 17 NKRAs, 17 SDGs and Nine Domains of GNH

9 Domains of GNH NKRAs (2018-23) 17 SDGs (2015-30) (Long Term) (1) Macroeconomic Stability [8] Decent Work and Economic Growth Living Standard [8] Decent Work and Economic Growth (2) Economic Diversification Living Standard [9] Industry, Innovation and Infrastructure [1] No Poverty (3) Reducing Poverty and Living Standard Inequality Good Governance [10] Reduced Inequality Cultural diversity and (4) Preservation of Culture [11] Sustainable Cities and Communities resilience Community Vitality 20

9 Domains of GNH NKRAs (2018-23) 17 SDGs (2015-30) (Long Term) [11] Sustainable Cities and Communities Ecological Diversity and (5) Healthy Ecosystem Resilience [15] Life on Land Good Governance [7] Affordable and Clean Energy Ecological Diversity and (6) Carbon Neutrality, Climate & [9] Industry, Innovation and Infrastructure Resilience Disaster Resilient Good Governance [13] Climate Action (7) Quality Education and Skills [4] Quality Education Education (8) Food and Nutrition Security [2] Zero Hunger Living Standard (9) Infrastructure, [9] Industry, Innovation and Infrastructure communication & Public Good Governance Services [16] Peace, Justice and Strong Institutions [4] Quality Education (10) Gender Equality [5] Gender Equality Good Governance [8] Decent Work and Economic Growth Good Governance (11) Productive & Gainful [8] Decent Work and Economic Growth Living Standard Employment Time Use (12) Corruption Reduced [16] Peace, Justice and Strong Institutions Good Governance (13) Vibrant Democracy & [16] Peace, Justice and Strong Institutions Good Governance Decentralisation 21 TWELFTH FIVE YEAR PLAN VOLUME - I

9 Domains of GNH NKRAs (2018-23) 17 SDGs (2015-30) (Long Term) Health (14) Healthy and Caring Society [3] Good Health and Well-being Community Vitality [6 ] Clean Water and Sanitation (15) Sustainable Human Community Vitality Settlements Living Standard [11] Sustainable Cities and Communities (16) Justice Services [16] Peace, Justice and Strong Institutions Good Governance Living Standard Health (17) Sustainable Water [6] Clean Water and Sanitation Ecological Diversity and Resilience 2.5 Bhutan’s Graduation from the 2018 triennial reviews. It did not meet the List of Least Developed threshold for the Economic Vulnerability Index Countries (EVI) during both the reviews. Marking a key development milestone, Bhutan A standard transition period of three years will graduate from the UN’s list of Least is granted to a graduating country once the Developed Countries in December, 2023. The decision to graduate is taken. During this period, decision on Bhutan’s graduation was endorsed a country continues to receive all benefits during the 73rd session of the United Nations associated with being an LDC. Normally, Bhutan General Assembly held in December, 201811. In would graduate in 2021. However, Bhutan order to be considered for graduation, a country requested for a 3+2 years transition period must meet the threshold levels for any two of coinciding with the implementation of the 12th the three criteria or twice the income threshold FYP. The longer transition period was requested in two consecutive triennial reviews of the to address the last mile challenges in all sectors Committee for Development Policy (CDP), the and ensure sustainable graduation. As the subsidiary advisory body of the United Nation’s 12th FYP will be Bhutan’s last FYP as an LDC, Economic and Social Council (ECOSOC). Bhutan accelerated support of all development partners fulfilled the threshold levels for the Gross for the implementation of the 12th FYP will be National Income (GNI) per capita and Human crucial to ensure that graduation is sustainable Asset Index (HAI) criteria during the 2015 and and irreversible. 11. http://undocs.org/en/A/73/L.40/Rev.1 22 Table 2.3: Bhutan’s performance on LDC graduation criteria Criteria 1st Triennial Review (2015) 2nd Triennial Review (March, 2018) USD 2,277 USD 2,401 GNI Per Capita (83.3% above threshold) (95.2% above threshold) 67.9 72.9 Human Asset Index (2.9% above threshold) (10.45% above threshold) 40.2 36.3 Economic Vulnerability Index (25.6% below threshold) (13.44% below threshold) Source: Committee for Development Policy, UN DESA 23 TWELFTH FIVE YEAR PLAN VOLUME - I 24 CHAPTER 3

12TH FIVE YEAR PLAN 25 TWELFTH FIVE YEAR PLAN VOLUME - I 3.1 Introduction ▀▀ Reducing corruption, ▀▀ Improving justice services and The 12th FYP was formulated following extensive institutions, and consultations with all relevant stakeholders. The ▀▀ Promoting gender equality. Plan aspires to fulfill Druk Nyamrup Tshogpa’s pledges to create a stronger, united, self- A Harmonious Society is defined as ‘a society reliant country. The 12th FYP has taken into where every individual lives in harmony with consideration the pledges made by the other oneself, community, nature, culture and three political parties. traditions’. Priorities to create a Harmonious Society are: The duration of the 12th FYP is aligned to the government’s tenure. Accordingly, the 12th ▀▀ Preserving and promoting culture and FYP period will begin from 1st November, traditions, 2018 and end on 31st October, 2023. ▀▀ Maintaining healthy eco-system, carbon neutral and climate resilient development, 3.2 12th Five Year Plan Objective ▀▀ Promoting healthy and caring society, and The objective of the 12 FYP is “Just, Harmonious th and Sustainable Society through enhanced ▀▀ Ensuring livability, safety and Decentralisation.” The objective has been sustainability of human settlements. inspired by the Royal Addresses and is anchored A Sustainable Society is defined as ‘a society able on the provisions of the Constitution; lessons to sustain its social, economic and environmental from the review of the 11th FYP; extensive development needs’. Priorities to create a stakeholder consultations including Civil Society Sustainable Society are: Organizations (CSOs) and political parties, and regional and international commitments ▀▀ Ensuring renewable energy supply, including the SDGs. The 12th FYP objective is underpinned by principles of leaving no one ▀▀ Ensuring macro-economic stability, behind, narrowing the gap between the rich and ▀▀ Enhancing economic diversity, and poor, and ensuring equity and justice. productive capacities, ▀▀ Ensuring water, food and nutrition A Just Society is defined as ‘a society where every security, citizen has equitable access to resources and opportunities to pursue and realize individual ▀▀ Improving efficiency and effectiveness of and national aspirations’. Priorities to create a public service delivery, Just Society are: ▀▀ Preserving cultural authenticity, and ▀▀ Reducing poverty and inequality, ▀▀ Ensuring community vitality. ▀▀ Creating productive and gainful Decentralisation means empowering local employment, governments and other sub-national bodies through provision of greater financial, planning ▀▀ Improving access to quality health and administrative responsibility, authority and services, accountability. ▀▀ Improving quality of education and skills, ▀▀ Strengthening democracy and decentralisation, 26 3.3 Strategic Framework 3.4 Flagship Programmes The 12th FYP is guided by the development A notable feature of the 12th FYP is the philosophy of GNH and its nine domains. The flagship programme. Flagship programmes strategic planning framework for the 12th FYP are interventions to address high priority illustrated below outlines the key deliverables national issues that require multi-sectoral of the Plan defined as the National Key collaboration and coordination in a Result Areas (NKRAs) at the national level, concerted manner. In addition to regular Agency Key Result Areas (AKRAs) at agency programmes, flagship programmes are level and Local Government Key Result Areas designed as key means to achieve the NKRAs (LGKRAs) at local government level. These through implementation of high impactful results will contribute to achieving the 12th activities. Flagship programmes focus on FYP objective. To measure the progress of major activities which are beyond financial these results, each NKRA, AKRA and LGKRA and technical capacity of the LGs. has corresponding KPIs with baseline and targets for the Plan period. Some of the high priority national issues to be addressed through the flagship programmes In order to achieve the results, flagship are economic growth and diversification, programmes, central programmes and LG employment generation, access to reliable programmes will be implemented. Central and safe drinking water, rural income agencies and LGs will ensure coordination, generation, efficiency and effectiveness of consolidation and collaboration to ensure public services, and waste management. synergy and efficiency during all stages of planning and implementation. Each flagship programme will have a Figure 3. 1: Strategic Framework MAXIMISATION OF GROSS NATIONAL HAPPINESS PLAN OBJECTIVE INSPIRATION AND Just, Harmonious and Sustainable Society through ANCHOR enhanced Decentralisation ROYAL ADDRESSES

17 NATIONAL KEY RESULTS AREAS CONSTITUTION VISION 2020 M&E STRATEGY FOR GNH AGENCY KEY RESULT LG KEY RESULT FLAGSHIP PROGRAMMES AREAS AREAS 2015 GNH SURVEY RESULT

11TH PLAN MID-TERM CENTRAL AGENCY REVIEW LG PROGRAMMES PROGRAMMES INTERNATIONAL GOALS COORDINATION CONSOLIDATION COLLABORATION STAKEHOLDER CONSULTATION 27 TWELFTH FIVE YEAR PLAN VOLUME - I detailed blueprint with clear results, for funding functions and provision of end-to-end interventions, costing, an 'investment menu'12 for all levels of timelines and division of responsibilities government. among various implementing partners. ▀▀ Determine, plan and implement other A blueprint will be developed for each aspects of decentralisation such as [i] flagship programme by Technical Working size, levels and capacities of functional Groups (TWG) composed of multi- burden, and [ii] human resource and sectoral stakeholders. The Government staff allocation for functions. shall approve the flagship programmes Above all, the delineation of responsibilities and implementation will be rigorously and revision is guided by the “principles of monitored by the Prime Minister's Office. subsidiarity and responsiveness” – who should do what and who will pay for what, which suggest that [I] goods and service provision should take 3.5 The Division of place at the lowest level of the government Responsibilities Framework that is capable of efficiently undertaking these (DoRF) functions, and those national level public goods and services that benefit the entire nation are In keeping with the provisions of the Constitution best performed by central agencies, and, [II]that of the Kingdom of Bhutan 2008 and LG Act 2009, LGs are best placed to understand the needs of and Government’s decentralisation efforts, the people as they are situated closer to them greater responsibility and resources (functional and can respond to changing needs of the and financial) have been delegated from the people quickly and easily. Centre to the LGs with clear delineation of responsibilities. The objectives of the framework Economies of scale, negative externalities, are to: equity, variety in demands of the people, transaction cost, levels of discretion in decision- ▀▀ Decentralise expenditures with assigned making, and levels of technical skills required functions to LGs based on efficiency, in terms of provision of goods and services by proximity and competency. It is to allow levels of government were also considered. greater autonomy and flexibility for LGs in terms of priority setting and choices The assigned responsibilities and the 'investment for enhanced planning, implementation menu' in the framework will be monitored and provision of efficient public goods for compliance. Based on the DoRF, past and service delivery with enhanced expenditure trends, and resource availability, accountability and professionalism. the capital grants for Dzongkhags, Gewogs ▀▀ Strengthen coordination and and Thromde ‘A’s in the 12th FYP have been implementation of policies, plans and doubled to Nu. 50 billion from Nu. 25 billion programmes amongst different levels of in the 11th FYP. This demonstrates the Royal government by providing clarity of roles Government’s commitment to allocate greater and distinct division of responsibilities. share of financial resources to LGs for enhanced local development and greater decentralisation. ▀▀ Provide a basis for resource sharing between Central agencies and the LGs 12. The “investment menu” comprises of list of expenditure functions such as schools, hospitals, farm roads, gewog connectivity roads, dzongkhag roads, and short-term capacity development,which is based on who should do what and who will pay for what. 28 3.6 National Key Result Areas Each NKRA is important in and of itself and interlinked with other NKRAs. To facilitate National Key Result Area is a development coordination and collaboration, a lead agency outcomes at the national level that will and collaborating agencies have been identified contribute towards achieving the plan objective. for delivery of each NKRA. The progress towards All central agencies and local governments achievement of NKRA is measured through KPIs. are responsible for contributing towards Each NKRA has at least one KPI with clear KPI achievement of the NKRAs through their description, unit of measurement, data sources respective Agency Key Result Areas (AKRAs) and and baseline and targets. Local Government Key Result Areas (LGKRAs). In the 12th FYP, 17 NKRAs, guided by nine domains This section outlines the detailed description of GNH, have been identified through extensive of each NKRA. The description highlights the consultation with various stakeholders ranging current situation and challenges (where we are from the private and corporate sector to right now), targets (where we want to be), and youth groups, government (central agencies, key strategies, programmes, and responsible constitutional bodies and LGs), political parties, agencies (how to get there). parliamentarians and CSOs to capture the needs and aspirations of the nation and its people. 29 Figure 3. 2 : The Seventeen NKRAs 1. Macroeconomic 2. Economic diversification 3. Reducing poverty and 4. Preservation of culture 5. Healthy ecosystem 6. Carbon neutrality, climate stability inequality and disaster resilient 7. Quality education and 8. Food and nutrition 9. Infrastructure, 10. Gender equality 11. Productive and gainful skills security communication and employment public services 12. Corruption 13. Vibrant democracy 14. Healthy and caring 15. Sustainable human 16. Effective justice 17. Sustainable water reduced and decentralisation society settlements services Table 3.1: The 17 NKRAs and the 9 GNH Domain matrix Psychological Time Cultural Good Community Ecological Living GNH DOMAINS Health Education Wellbeing Use Diversity Governance Vitality Diversity Standard 12th FYP NKRAs Macroeconomic Stability X Economic Diversification X Reducing Poverty & X X Inequality Preservation of Culture X X X Healthy Ecosystem X X Carbon Neutrality, Climate X X & Disaster Resilient Quality Education & Skills X X Food & Nutrition Security X Infrastructure, Communication & Public X X Services Gender Equality X X X Productive & Gainful X X X Employment Corruption Reduced X Vibrant Democracy & X Decentralisation Healthy & Caring Society X X X Sustainable Human X X X Settlements Effective Justice Services X X Sustainable Water X X X TWELFTH FIVE YEAR PLAN VOLUME - I NKRA 1 Macroeconomic stability This NKRA aims to create a strong Containing expenditure growth macroeconomic environment by ensuring stable growth, sustainable fiscal deficit, price stability, While the constitutional mandate to meet full employment and sound financial system. current expenditure through domestic revenue A stable and predictable macroeconomic is being fulfilled, there is no binding constraints environment will lead to better resource to contain current expenditure growth. Average allocation decisions, promote investment and current expenditure from the 8th to the 11th FYP sustainable growth. Ministry of Finance is the grew at an average rate of 90 percent14. The lead agency for this NKRA. growth in current expenditure during the 11th FYP is attributed to increase in maintenance Current situation and key and operational costs of public infrastructure challenges and services, personnel emoluments, interest payments on public debt, and provisions Over the last three decades, Bhutan’s economy for elections and central schools. Inability to has grown at a rate of approximately 7.5 contain current expenditure growth will lead percent. In the last 10 years alone, GDP has to depletion of savings for future investments. more than tripled and per capita income Therefore, it will be crucial to rationalise current increased from USD 1,815 to USD 3,43813. expenditure. Equally important is to rationalise Domestic revenue has continued to grow over government expenditure and minimise the successive plan periods with hydropower as wasteful capital expenditure by ensuring cost the main contributor. The coverage of current effectiveness especially in public construction expenditure by domestic revenue increased and government procurement. from 73 percent in the 5th FYP to 124 percent in the 11th FYP. Similarly, the coverage of total Managing public debt expenditure also increased from 28 percent to 63 percent. Bhutan’s public debt stock reached 108 percent of GDP at the end of the 11th FYP compared to Despite the economic progress, challenges still 63.5 percent at end of the 9th FYP. Major share remain. The following are the key challenges of the debt constitutes hydropower debt. that need to be addressed in the 12th FYP: Bhutan’s debt level has been maintained within 13. NSB, National Accounts Statistics (2018). 14. MFCC (Oct 2018). 32 Figure 3.3: Trend in current expenditure Source: CBS & GNHR’s construct from Annual Financial Statements 2002-2017, Ministry of Finance. the permissible thresholds for both hydro limited capacity to earn convertible currency, and non-hydropower debt in line with Public financing debt service may prove to be a challenge. Debt Policy 2016. However, given the declining Overseas Development Assistance (ODA) and Figure 3.4: Debt service in the 11th FYP Source: CBS & GNHR’s illustration from Monthly Statistical Bulletin, RMA (February 2019). Note: Debt service ratio is a percentage of debt service payment in proportion to export value of goods and services in any given year 33 TWELFTH FIVE YEAR PLAN VOLUME - I Figure 3.5: Movement in external debt stock, 2001/02-2016/17 Source. CBS & GNHR’s construct from Selected Economic Indicators, RMA (2002-2017). Limited domestic savings Creating productive and gainful employment Investment has been driven mainly by Hydropower led structural transformation government through a combination of capital has not translated into a commensurate shift expenditure and construction of hydroelectric in the sectoral share of employment within projects. Gross domestic savings is able to the economy. As a result, agriculture sector finance only 66 percent of investment with is still the largest employer with 57.2 percent remaining financed through external loans and employment15, while contributing only 16.5 ODA. This has contributed to a consistent current percent to GDP16. The economy has achieved full account deficit and increase in public debt stock. employment, but youth unemployment remains Efforts to increase domestic savings through high at 12.3 percent in 2017 with a higher rate of expanding sources of revenue and curtailing female youth unemployment. There is a need costs will need to be undertaken. There is a to diversify the economy in areas with high need to harmonize fiscal and monetary policies potential for job creation to absorb the growing to encourage private savings in the economy number of youth entering the labour market which could become one of the major sources each year. of investment. Measures to create an enabling environment for profitable businesses and investment opportunities to flourish, enhance access to finance, and divert capital towards productive sectors must be undertaken. 15. NSB, Bhutan Living Standards Survey (2017). 16. NSB, National Accounts Statistics (2018). 34 Strategies 2. Strengthening fiscal sustainability This programme aims to strengthen In order to address the challenges and achieve results based planning and budgeting the NKRA, following strategies have been process. The key features of the identified: programme are to focus on outputs and outcomes of government ▀▀ Broadening revenue base and spending programmes, promote streamlining tax administration. understanding of fiscal issues and challenges in pursuing prudent ▀▀ Instituting expenditure control public financial management. In measures on public constructions and addition, this programme will enhance procurement. effective allocation and utilisation of ▀▀ Exploring additional concessional scarce public resources with greater financing windows. accountability. The programme will be ▀▀ Boosting private investment and implemented by MoF. savings. 3. Strengthening public financial management This programme aims to ensure Programmes prudent use of public resources The following programmes will be through judicious expenditure implemented to acheive the NKRA: management, efficient fiscal transfers and treasury operations. 1. Strengthening macroeconomic The Government’s assets, properties coordination and inventory management will be This programme aims to promote a enhanced. The programme will be sound macroeconomic environment implemented by MoF. by developing a macroeconomic model to track and forecast key macroeconomic variables. An early economic warning system will be operationalised to ensure appropriate macroeconomic policies and decisions are taken in a timely manner. The programme will also improve governance and management of state owned enterprises. The programme will be implemented by MoF. 35 TWELFTH FIVE YEAR PLAN VOLUME - I Table 3.2: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year National Annual Average rate at which Accounts 1.1 average real the GDP changes/grows % 11th FYP 5.59 6-7 percent Statistics, GDP growth over the plan period. NSB Real Gross Domestic National GDP per Product per capita by Accounts 1.2 USD 2017 3,438 >4,500 capita the end of the plan Statistics, period. NSB Average Annual Average fiscal deficit as a fiscal deficit Financial 1.3 percentage of GDP over % 11th FYP 1.38 <3 over the plan Statement, the plan period. period MoF Current Current account Annual 1.4 account balance expressed as a % 2016-17 - 22.8 <-12 Report, RMA balance percentage of GDP. The ratio of total external debt service Monthly Annual debt 1.5 (principal and interest % 2016-17 24.9 ≤25 Statistical service ratio repayment) to total Bulletin, RMA export earnings. 36 NKRA 2 Economic diversification This NKRA aims to develop an inclusive, The growth has been driven by government sustainable and equitable economy with expenditure and investment. decent livelihood opportunities for everyone through accelerated private sector growth and The economy remains undiversified with investment in agriculture, tourism, cottage manufacturing sub-sector accounting for and small industries (CSIs), mining and allied minor share in the industries sector. Electricity hydropower industries. Ministry of Economic sector alone contributed an average of 16 Affairs is the lead agency for this NKRA. percent between 2007 and 201617. The share of hydropower sector is as high as 30 percent Current situation and key if hydropower construction is included. challenges Furthermore, close to 85 percent of trade is with India consisting mainly of hydropower18. The share of industry sector in GDP There exists untapped economic opportunity increased from 11.5 in 1980 to 40.6 percent to diversify the export basket with the large in 2017 and share of agriculture dropped Indian market and beyond. to 17.4 in 2017 from 42.9 percent in 1980. Trading sector constitutes majority of Figure 3.6: Average sectoral share to GDP, businesses in Bhutan at 72 percent with 2007-2017 industries making up only 28 percent19. Within the industries sector, CSIs constitutes about 96 percent. However, only 11 percent of CSIs are in production & manufacturing (P&M) concentrated in producing low value added products. About 50 percent of the P&M units are engaged in production of furniture (23 percent), audio visual production (8 percent), bakery (7 percent), fabrication works (7 percent) and sawmill (6 percent). As of 2018, there are a total of 20,093 industries in the country, of which 18,032 are CSIs (90%) and 2,061 Medium & Large (10%). About 35% of these industries are located in Thimphu. 17. NSB, National Account Statistics (various years). The following are some of the key economic 18. DRC, MoF, Bhutan Trade Statistics (2018). 19. DSCI, MoEA, CSI Annual Report (2018). challenges: 37 TWELFTH FIVE YEAR PLAN VOLUME - I Limited commodities for export through the change in its volume and composition. The total exports increased by Foreign trade has played a crucial role in the 34 percent between 2007 and 2017 while the economy and its growth. This is reflected import volume increased significantly Table 3.3: Share of electricity and top 10 commodities of total merchandise export (2007-2017)20 Indicators 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Average Total Export (Nu. Million) 27,859 22,591 23,993 29,324 31,486 28,420 31,853 35,585 35,229 35,258 37,297 30,809 10,034 11,033 10,091 10,411 10,441 9,125 11,227 10,634 12,124 13,032 11,983 10,921 o/w Electricity (36%) (49%) (42%) (36%) (33%) (32%) (35%) (30%) (34%) (37%) (32%) (36%) o/w other top 10,686 7,384 10,077 14,330 16,119 14,291 15,094 17,528 16,001 15,394 17,760 14,060 10 exports (38%) (33%) (42%) (49%) (51%) (50%) (47%) (49%) (45%) (44%) (48%) (45%) Table 3.4: Ranking of exports to India (Nu. in million) Export Average 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 commodities (2004-2016) Electricity 2,712 3,439 4,982 10,034 11,033 10,091 10,411 10,441 9,382 11,227 10,634 12,125 13,032 39% export Base metals 1,737 2,491 4,098 6,302 5,251 7,013 9,833 10,044 10,800 10,005 10,826 9,606 8,875 31% and articles Mineral 674 984 1,587 1,809 2,162 2,519 2,782 2,573 2,924 3,309 4,800 4,814 4,646 11% products Products of chemicals or 712 714 587 783 894 1,051 1,454 1,476 1,639 1,885 1,954 1,990 1,715 6% allied industries Vegetable 286 243 277 307 242 607 453 595 585 977 1,475 1,132 1,536 3% products Animal and vegetable fat 0 224 1,448 1,875 605 4 13 24 7 3 14 8 10 2% oils Plastics and 271 293 247 276 213 308 246 309 331 462 635 678 677 2% articles Prepared food 408 389 414 368 276 319 318 407 391 579 838 897 1,067 2% stuffs Textiles 536 787 476 445 291 66 41 32 46 44 30 11 1 2% Wood and 280 310 254 303 300 313 311 306 350 297 365 333 304 2% articles of wood Articles of stone, cement, 24 15 25 113 122 81 74 121 127 152 196 168 150 0% etc. Total 7,641 9,890 14,395 22,616 21,388 22,371 25,937 26,329 26,581 28,941 31,768 31,763 32,013 100% 20. DRC, MoF, Bhutan Trade Statistics (2007 & 2017). 38 by 208 percent. A few products have of the total exports basket, earnings from dominated Bhutan’s export basket over the these products are also vulnerable to both last decade apart from hydropower. Electricity external and internal shocks. The mineral and remained the highest merchandise export base metal products are currently competitive over the last decade averaging 36 percent due to subsidised electricity rather than any between 2007 and 201721. Another 45 percent technological advantage. Non-hydro export was concentrated only in 10 commodities. In has stagnated over the last decade signifying 2017, total export amounted to Nu. 37,297 major challenge in product diversification. million of which electricity contributed 32 percent followed by base metals at 29 percent, Further, there is also limited value addition mineral products at 10 percent, and chemical with majority of the commodities being and allied products at 4 percent. Traditional exported in their primary form. exports (agriculture) contributed up to 4 percent of the total export. Challenges related to ease of doing business Besides limited products making up majority Bhutan’s overall ease of doing business rank Table 3.5: Ease of Doing Business Ranking has significantly improved to 81st position out Ranking Score of 190 economies in 2018 from 141st in 201322. Sl. No. Indicator As evident from the table 3.5, Bhutan is doing 2013 2018 2013 2018 well in the indicators of paying taxes, enforcing

1 Trading across borders 172 28 na 94.25 contracts and trading across borders.

2 Paying taxes 104 15 na 89.28 Challenges still remain in getting credit, dealing with construction permits and starting a

3 Starting a business 86 91 na 86.38 business indicators. Further, critical challenge

4 Getting electricity 91 73 na 77.39 remains in improving protecting minority investors and resolving insolvency.

5 Registering property 86 54 na 72.99 Delay in commissioning of hydropower

6 Enforcing contracts 37 28 na 69.99 projects Dealing with 7 132 88 na 68.85 construction permits Hydropower is a major source of revenue and driver of economic growth.

8 Getting credit 109 85 na 55.00 It contributes approximately 13 percent 9 Protecting minority 147 125 na 46.67 to GDP23 and 10 percent to national investors revenue24 in 2017. Consequently, delays

10 Resolving insolvency 189 168 na 0.00 in commissioning of projects mainly due to geological surprises has direct impact Overall 141 81 54.67 66.08 on both growth and domestic revenue. 21. DRC, MoF, Bhutan Trade Statistics (2007 & 2017). 22. The World Bank, Doing Business Report (2014 & 2018). 23. NSB, National Accounts Statistics (2018). 24. DRC, MoF, National Revenue Report (2016/17). 39 TWELFTH FIVE YEAR PLAN VOLUME - I Projected economic growth in the 12th FYP ▀▀ Attracting private and foreign investment by creating enabling The economy is projected to grow between business environment particularly 6-7 percent on average in the 12th FYP period improving indicators of ease of doing as shown in table 3.6. business in which Bhutan is lagging behind. Strategies ▀▀ Promotion of high value added CSIs In order to address the challenges and through support to product design achieve the NKRA, following strategies have and branding, skills development, and been identified: facilitate marketing. Table 3.6: Sector wise growth projections in the 12th FYP Average 12th FYP Sector wise growth projections 2018/19 2019/20 2020/21 2021/22 2022/23 Growth Agriculture, livestock and forestry 3.73 2.83 2.83 2.84 2.84 3.01 Agriculture proper 3.98 3.00 3.00 3.00 3.00 3.20 Livestock production 3.64 3.09 3.09 3.09 3.09 3.20 Forestry and logging 3.22 2.00 2.00 2.00 2.00 2.24 Industry 4.51 3.91 3.32 2.15 1.68 3.12 Mining and quarrying 14.00 14.00 9.74 4.97 4.00 9.34 Manufacturing 10.27 10.27 10.27 11.72 13.03 11.11 Electricity, gas and water 5.50 8.86 1.92 -4.35 -4.13 1.56 Construction -1.61 -7.27 -2.28 0.58 -3.47 -2.81 Services 8.85 10.52 8.25 6.49 7.03 8.23 Wholesale and retail trade, hotel and 11.36 9.91 9.93 9.94 9.95 10.22 restaurant Wholesale and retail trade 12.43 10.19 10.19 10.19 10.19 10.64 Hotel and restaurant 5.94 8.42 8.49 8.55 8.60 8.00 Transport, storage and communications 9.65 9.33 9.33 9.33 9.33 9.39 Financing, insurance and real estate 7.75 7.39 8.97 9.01 9.05 8.44 Finance 8.37 8.06 10.00 10.00 10.00 9.29 Real estate 5.31 4.65 4.65 4.65 4.65 4.79 Community, social and personal services 6.24 15.88 4.59 -3.29 -2.08 4.27 (govt) Private social & recreational services 4.16 4.16 4.16 4.16 4.16 4.16 Real GDP at market prices 5.36 5.44 5.24 4.37 5.09 5.10 Source: MFCC (October 2018) 40 ▀▀ Accelerating tourism sector 3. Creating business and investment development through diversification friendly environment of products, services and amenities, This programme will improve all intensifying marketing to promote 10 indicators of the ease of doing Bhutan as a year round destination for business index to create an enabling high-end tourism. business environment. Specifically, the programme aims to improve ▀▀ Diversifying into allied hydropower starting a business and, dealing industries and securing energy security with construction permits, resolving for economic growth. insolvency and protecting minority investor indicators. The programme Programmes will be implemented by MoEA. The following programmes will be 4. Enhancing hydropower generation implemented to achieve the NKRA: and transmission This programme aims to generate 1. Enhancing economic growth through 2,444 MW by end of the plan period. sector diversification The programme will also initiate This programme aims to accelerate efforts to develop hydropower related development of priority sectors, services in the region. The programme which have potential to create will be implemented by MoEA. wealth, employment and sustainable growth as identified in the Economic 5. LG programme on poverty reduction, Development Policy (EDP) 2016. The income generation, and job creation programme will increase secondary This programme aims to enhance sector GDP growth rate to 11 percent rural economy through establishment from 6.7 percent in 2017; establish of cottage, small and medium scale 100 additional medium and large industries with job creation potential. industries; attract 25 new FDI projects; The programme will be implemented and create jobs in CSI, hydropower, by the LGs. mining, medium and large industries, and trading sectors. The programme will be implemented by MoEA. 2. Promoting export This programme aims to diversify exports and increase export volume and markets particularly of non- hydro sector. The programme will be implemented by MoEA. 41 TWELFTH FIVE YEAR PLAN VOLUME - I Box 3.1: Startup & Cottage and Small of Labour and Human Resources, Ministry Industries (CSI) Development Flagship of Agriculture and Forests, Royal Monetary Programme Authority, Bhutan Standard Bureau, Bhutan Chambers for Commerce and Industries (BCCI), This programme aims to foster job creation Local Governments and private sector. and enhance income generation by enabling creation of new CSIs and improving competitiveness of existing ones. It will focus Box 3.2: Sustainable Tourism Development on building entrepreneurship and innovation Flagship Programme culture and promote startups. A total of 1,050 CSIs, both new and existing will be provided This programme aims to increase contribution with targeted support to help generate of tourism to national economy and rural additional 4,700 jobs. livelihood through balanced regional development and seasonal spread of tourism Business incubation centres and FabLabs will while providing an enhanced visitor experience be established in colleges and technical training of Bhutan as exclusive destination. The institutes to encourage creativity and innovation. programme adopts a three tiered approach Furthermore, platforms will be provided to to achieve its objective. It will create the showcase and identify creative business ideas. necessary policy and regulatory frameworks to The existing Business Startup Centre will be support an enabling environment, institutional strengthened to provide end-to-end services strengthening and the adoption of safeguards ranging from business idea generation, mentoring and safety standards. It will identify and of entrepreneurs, skills development, product implement selected projects to develop diverse design, production enhancement and marketing. tourism packages and a specific component on The flagship programme will provide targeted allied waste management across the country. support through product standardisation, It will undertake focused end to end activities packaging, certification and branding to in five strategically placed Dzongkhags for produce and market 20 different products that accelerated tourism development. have market potential. The programme targets to increase tourism The programme will also streamline legal and gross receipts from Nu.10 billion to Nu. 39 policy frameworks; improve access and explore billion and direct revenue contribution from alternative financing mechanisms; build human Nu.1.6 billion to Nu. 5.5 billion in the next five capital; and improve business development years. It is expected to create 15,000 additional services to create enabling ecosystem for Start- jobs. up and CSI growth, An indicative outlay of Nu.1.566 billion has An indicative outlay of Nu. 1.2 billion has been earmarked for the programme, and been earmarked for the programme, and implementation will be led by Tourism Council implementation will be led by Ministry of of Bhutan in collaboration with the LGs, Ministry Economic Affairs in collaboration with Ministry of Economic Affairs and Private sector. 42 Box 3.3: Organic Flagship Programme An indicative outlay of Nu.1.0 billion has been earmarked for the programme, and This programme aims to commercialize organic implementation will be led by Ministry of production. The programme will provide access Agriculture and Forests in collaboration with to bio-inputs and organic seeds, develop an the LGs, Ministry of Economic Affairs and organic value chain and market system, and other relevant agencies. develop and operationalize organic certification systems. The programme will target the organic production of 8 selected commodities for export and 4 for domestic consumption. The programme aims to produce approximately 254,000 metric tonnes of bio-inputs within five years. It will generate approximately 1,500 new jobs and engage around 33,000 farmers across the country. Table 3.7: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Non-hydro revenue Non-hydro is defined as total 11th FYP 2.1 % 6.9 6-7 MFCC Revenue growth revenue minus hydro average revenue Distance to frontier in Doing Distance to all 10 areas of ease of Score Business 2.2 Frontier Score 2018 66.08 >70 doing business of the (0-100) Report, World (Doing Business) World Bank Bank 43 TWELFTH FIVE YEAR PLAN VOLUME - I NKRA 3 Reducing poverty and inequality This NKRA aims to improve living conditions Current situation and key of the general population and narrow the challenges gap between the rich and the poor. It aims to eradicate poverty in all its forms through Poverty improvements in health, education and living standard. It also aims to create an inclusive Bhutan has managed to bring down incidence of society by reducing various forms of inequality both income and multi-dimensional poverty of income and consumption and unequal as a result of broad-based as well as targeted access to critical services such as health poverty reduction programmes and policies and education. Gross National Happiness implemented over successive plans. The Commission Secretariat is the lead agency for national poverty rate has been reduced from this NKRA. 23.2 percent in 2007 to 8.2 percent in 201725. In the same period, rural poverty was brought down to 11.9 percent from 30.9 percent Figure 3.7: Poverty rates by dzongkhag, 2017 25. NSB, Bhutan Poverty Analysis Report (2017). 44 and proportion of urban poor reduced poverty in all its forms. The Bhutan Poverty from 2 percent to 0.7 percent. Incidence of Analysis Report (PAR) 2017 has found that of subsistence poverty or extreme poverty stood the estimated surveyed population of 692,895 at 1.5 percent. in 2017. Multi-dimensional persons in the country, 56,855 are estimated poverty was more than halved to 5.8 percent26 to be poor and 10,687 are subsistence poor. in 2017 from 12.7 in 201227. At the household level, of the estimated 164,011 households, 9,424 are poor and 1,677 Sustained investments in health and education are extremely poor. There is also disparity have improved the lives of people especially in poverty levels among Dzongkhags with in areas of life expectancy, mortality, and poverty rates ranging from 0.3 percent to literacy. 97 percent of rural households have 33.3 percent. Poverty in rural areas at 11.9 access to electricity and almost all households percent is higher than urban areas at 0.8 (99.5 percent) have access to improved water percent. About 97 percent of the poor reside supply28. About 92 percent of households in rural areas and among the extremely poor, have access to improved sanitation facilities. practically everyone resides in rural areas. It The GNH Survey 2015 also found that is important to note that from the 8.2 percent improvements in standard of living through of monetary poor, 7.2 percent are not multi- significant increases in sufficiency levels of dimensional poor and from the 5.8 percent of housing, assets and income contributed to the the multi-dimensional poor, 4.8 percent are increase in the level of GNH. not monetary poor29. Despite the progress, Bhutan is still confronted The causes of poverty are numerous with the last-mile challenge of eradicating Figure 3.8: Level of satisfaction with standard of living 26. NSB, Poverty Analysis Report (2012). 27. NSB, Bhutan Multidimensional Poverty Index (2017). 28. NSB, Bhutan Living Standards Survey (2017). 29. NSB, Bhutan Multidimensional Poverty Index (2017). 45 TWELFTH FIVE YEAR PLAN VOLUME - I going beyond lack of income, and are self- expenditure of households in the fifth (richest) reinforcing in nature. Shortage of labour due per capita consumption quintile (Nu. 17,802) to migration, lack of education, disabilities, is more than seven times that of households and lack of infrastructure are some of the in the poorest per capita consumption quintile main compounding causes. The diverse (Nu. 2,468) and the income gap is wider characteristics and profile of the poor in between the rural and urban population30. The Bhutan reveal the need for highly targeted and average annual household income for urban customised interventions to reduce poverty population was 172 percent more than that of in the more deprived groups. The Bhutan rural counterparts. Multi-dimensional Poverty Index 2017 also found that the incidence of multi-dimensional Strategies poverty is determined by a range of factors including age, gender and education level of In order to address the challenges and achieve head of household. the NKRA, following strategies have been identified: Inequality ▀▀ Target the poor: Groups most vulnerable Bhutan has always strived to pursue inclusive will be identified and provided to need- and broad-based development policies and based interventions to increase their programmes. For example, the provision of ability to earn income and improve free access to basic public health services their overall standard of living. The and education to all citizens, representing focus will be on creating income- two important social equalisers, have been generating opportunities through prioritised since the beginning of development skills enhancement and capacity planning in 1961. However, Bhutan’s Gini index, development, ensuring food security which measures the level of income inequality and improving overall health and well- within the country increased to 0.38 in 2017 being. from 0.36 in 2012. The deterioration of the ▀▀ Continue broad based social investments: score calls for assessment of existing policies Broad-based social sector programmes and programmes to ensure that benefits of in areas of health, education and development are equitably shared and that agriculture shall be implemented by inequality stemming from differential access both central agencies and LGs. The to opportunities and wealth are minimised. focus shall be on enhancing equitable access to social services as well as At the household level, inequality can lead pursuing improvements in overall to adverse outcomes in education and quality of services provided. health outcomes including mental illness, social mobility and level of trust within the ▀▀ Implement specific policy measures: community. Specific policy measures that are pro-poor to reduce inequality In terms of consumption, the mean per capita shall be pursued. To ensure that Dzongkhags, Gewogs and Thromdes 30. NSB, Bhutan Living Standards Survey (2017). 46 with high incidence of poverty receive medical teams offering specialist adequate resources, poverty shall services to unreached pockets and be used as a criterion to determine populations will be instituted. Efforts to resource allocation among LGs. The support the informal sector will also be national minimum wage rate for the undertaken. national workforce shall be reviewed. Allowances for women in rural areas Programmes during initial months of child birth shall also be explored. provision of free Since poverty and inequality are cross cutting nutritious lunch for needy children in issues, interventions to achieve the NKRA have identified schools and institutes shall be been mainstreamed into the programmes of launched. To provide equitable access, other 16 NKRAs. well-equipped permanent mobile Table 3.8: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year People living below multi- Bhutan Multidimensional dimensional (health, 3.1 % 2017 5.8 <5 Multidimensional Poverty Line education and living Poverty Index, NSB standard) poverty line. Ratio of income distribution within the country’s resident on a scale of 0-1 Poverty Analysis 3.2 Gini Coefficient Range 2017 0.38 <0.38 with 0 representing Report, NSB perfect equality and 1 representing perfect inequality. 47 TWELFTH FIVE YEAR PLAN VOLUME - I NKRA 4 Preservation of culture This NKRA aims to reinforce efforts in Current situation and key preserving and promoting culture and challenges tradition to strengthen our identity and sovereignty. It takes cognisance of culture as The strong Bhutanese identity, which we an evolving dynamic force and the need to are proud of today has been laid on the facilitate continued evolution of traditional foundations of a strong Bhutanese culture that values and institutions as a progressive has evolved and remained vibrant through society31. Culture and tradition encompass centuries. Bhutan continues to uphold its intangible aspects such as knowledge, skills, culture while embracing rapid modernisation. attitudes, beliefs, music, oral traditions, and The following table shows changes in key festivals in addition to tangible culture, which variables of cultural domain as captured by includes dzongs, temples, arts, antiquities, the 2010 and 2015 GNH Surveys. indigenous food, and sports. Ministry of Home and Cultural Affairs is the lead agency for this While the overall cultural diversity index has NKRA. not deteriorated significantly over the last five years, the sector still faces challenges as follows: Table 3.9: Comparative results of key indicators of Culture domain, 2010 and 201532 Sl. Indicators 2010 2015 Change No. Results Results

1 Overall culture diversity and resilience index 11.05 11.01 Dropped by 0.04 points

2 Percent of population who can speak mother 95.2 94.9 Dropped by 0.03 points tongue ‘very well’

3 Percent of population who participate in cultural 33.2 45.8 Improved by 12.6 activities

4 Proportion of population who perceived Driglam 93.1 92.2 Dropped by 0.09 Namzha as very important

5 Proportion of population that possesses skills in 62.0 62.58 Improved by 0.58 at least one of 13 different arts and crafts (zorig chusum) 31. RGoB, Constitution of Kingdom of Bhutan (2008). 32. CBS&GNHR, GNH Survey Results Report (2010 & 2015). 48 Maintaining vibrancy of intangible culture ▀▀ Promoting Dzongkha and Dzongkha computing. Languages, spiritual values, arts and festivals ▀▀ Promoting contemporary arts such as are key components of our rich intangible films and music. culture. Ensuring vibrant practice of these aspects of culture in the face of rapid ▀▀ Promoting cultural industries as an modernisation is a challenge. Some of our economic enterprise. local dialects, songs, dances, lozeys, festivals ▀▀ Including culture as a criteria for and rituals are on the verge of extinction as resource allocation to LGs. there are very few elderly people keeping these traditions alive. The younger generation Programmes is either not keen or do not have the skills to continue these traditions. For instance, The following programmes will be the Olekha, a local dialect spoken in Rukha, implemented to achieve the NKRA: Wangdue Phodrang is already extinct. Therefore, documenting, preserving, and 1. Sustenance and continuity of cultural promoting intangible cultural heritage has heritage become urgent. This programme aims to undertake preservation and conservation of both Preserving cultural structures tangible and intangible cultural heritage. Based on requirements, new Dzongs Many of the rich historical, cultural and and Lhakhangs will be constructed and spiritual sites which existed for centuries are existing ones maintained and restored. under continuous threat from both natural In order to safeguard cultural heritage, and man-made disasters. These monuments the programme will register cultural are exposed to a range of disasters such properties, conduct research, and as earthquakes, fires, windstorms, and undertake documentation. Museums and landslides. Conservation, restoration, and cultural library services will be enhanced. making these sites disaster resilient is critical. Furthermore, disaster management In addition, meeting the financial resources capacity of cultural heritage sites will for restoration and preservation of cultural be improved. The programme will be infrastructure is a recurring challenge. implemented by MoHCA. Strategies 2. Enhancing spiritual values This programme aims to promote In order to address the challenges and meditation, monkhood, and spiritualism. achieve the NKRA, following strategies have The programme will be implemented by been identified: Dratshang Lhentshog. ▀▀ Preserving age-old traditional 3. Promotion of national language and festivals. local indigenous languages ▀▀ Supporting important historical This programme aims to promote use community-managed lhakhangs. of the national language and other local 49 TWELFTH FIVE YEAR PLAN VOLUME - I dialects. The programme will conduct 4. LG programme on preservation and research, organise national events promotion of culture and traditions including awareness programmes and This programme aims to preserve improvement of language contents. The and promote culture and tradition by programme will specifically document maintaining tangible cultural heritages 18 indigenous dialects native to such as community lhakhangs and Bhutan for use and preservation. The chortens in respective Dzongkhags. programme will be implemented by The programme will also focus on Dzongkha Development Commission. promotion and preservation of intangible culture such as local songs, dances, folk stories and local festivals. The programme will be implemented by the LGs. Table 3.10: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year People enjoying Population that have met the sufficiency in sufficiency threshold of speaking GNH Survey, 4.1 % 2015 95 ≥95 speaking native native language as defined by CBS&GNHR language GNH survey People enjoying Population that have met the sufficiency sufficiency threshold of cultural GNH Survey, 4.2 % 2015 46 >50 in cultural participation as defined by GNH CBS&GNHR participation survey Population that have met People enjoying the sufficiency threshold of sufficiency GNH Survey, 4.3 knowledge and practice of % 2015 43 >50 in Driglam CBS&GNHR Driglam Namzha as defined by Namzha GNH survey 50 NKRA 5 Healthy ecosystem This NKRA aims to maintain efforts to conserve timber, fiber, and fuel34. In Bhutan as well, our natural environment to ensure sustainable there is growing evidence indicating that vital ecosystem services. Ecosystem services include ecosystem and the services it provides has been land, clean water, clean air, and ambient climate degrading over time. Reports highlight drying of that are essential for sustaining life on the water sources, outbreak of pest and diseases, planet. Ministry of Agriculture and Forests is the occurrence of flash floods and landslides, and lead agency for this NKRA. increasing pressure on biodiversity through developmental activities. Current situation and key challenges Further, with rapid pace of socio-economic development, pressures on the natural Environmental conservation is a domain of environment is rising. The conversion of forests GNH and it is integrated in every policy and into other land uses is increasing. Between 2008 development plan. Adequate legal framework and 2014, 9,426 ha of state reserved forest land and regulations emphasising sustainable were lost to construction of transmission lines, management and utilisation of natural 5,462 ha to farm roads and 5,208 ha to long- resources have been adopted. Currently, about term land lease35. Moreover, between 2011 and 71 percent of the total land area of Bhutan is 2012, 153 ha of state land were allocated from under forest cover with over 50 percent as parks, protected areas and 2,561 ha of land from other biological corridors and strict nature reserves. state land for developmental purposes leading A preliminary estimate of Bhutan’s ecosystem to habitat fragmentation. services was valued at USD 15.5 billion a year in 2012, ten times more than the country’s Fuel wood accounts for 21 percent of total GDP at that time. The estimate also confirmed household energy consumption. Illegal that 53 percent of the total ecosystem service harvesting and wildlife poaching further benefits is accrued by people outside Bhutan33. compound pressure on forest resources and In our efforts to capture benefits that people biodiversity. Limited knowledge on population derive from the natural environment, work on dynamics of key indicator species, geological establishing GNH accounts, covering ecological and hydrological aspects, infrastructure capital, cultural capital, human capital, social development for nature-based tourism are a and economic capital is being initiated. constraint. Globally, ecosystems are facing degradation The National Biodiversity Strategies and Action to meet growing needs for food, fresh water, Plan for Bhutan, 2014 identifies land use 33. An Initial Estimate of the Value of Ecosystem Services in Bhutan, Kubiszewski et al. 2013 34. Millennium Ecosystem Assessment, Ecosystem and Human Well-being (2015). 35. RGoB, Bhutan State of the Nation Report (2016). 51 TWELFTH FIVE YEAR PLAN VOLUME - I conversion, over exploitation of timber and fuel will also ensure that environmental wood, forest offences and wildlife poaching, conservation is integrated in economic unsustainable agricultural practices, pollution, development process through proper invasive species, human wildlife conflict, climate implementation of environment change, over-grazing, and waste as factors legislations and regulations. The affecting the ecosystem. programme will be implemented by the NECS. Strategies 3. Strengthening air quality In order to address the challenges and achieve monitoring system the NKRA, following strategies have been This programme aims to install additional identified: automated air quality monitoring stations to ensure ambient air quality across ▀▀ Exploring innovative financing for the country. The programme will be sustainable management of protected implemented by the NECS. areas. ▀▀ Initiating payment for ecosystem services. ▀▀ Strengthening research on biodiversity information. ▀▀ Promoting traditional knowledge and customary practices in conservation and sustainable use of biodiversity. Programmes The following programmes will be implemented to achieve the NKRA. 1. Sustainable natural resources management and utilisation This programme aims to ensure a holistic, concerted and effective approach towards sustainable use and management of natural resources for economic, environmental and social well-being of the present and future generations. The programme will be implemented by MoAF. 2. Enhanced environmental service delivery This programme aims to provide effective and efficient environmental services and promote knowledge and awareness on environment issues. The programme 52 Table 3.11: Key Performance Indicators Baseline No KPI Description Unit Baseline Target Source Year Population Number of tigers Survey Reports, status of living within the Department of 5.1 umbrella geographical Number 2015 103 ≥103 Forest and Park species boundaries of the Services, MoAF (Tiger) country Particulate matter of less than 10 micrometres in Ambient diameter (PM10) 43 <60 Air Quality in Thimphu, and Annual (Thimphu) (Thimphu) Administrative 5.2 levels(PM10) Pasakha. PM10 Average μg/ 2016 275 <120 Data, NECS is generally m3 (Pasakha) (Pasakha) understood as “repairable dust” that is inhaled by humans. 53 TWELFTH FIVE YEAR PLAN VOLUME - I NKRA 6 Carbon neutrality, climate and disaster resilient This NKRA aims to ensure a carbon neutral36 remained constant, with emissions from other development path and enhance capacity to sectors such as industrial and transport sectors respond, mitigate and adapt to climate change. increasing over the years. Bhutan currently has It also aims to build resilience and preparedness 71 percent forest cover, and efforts to conserve to respond to disasters thereby reducing losses protected areas are on-going. In 2017, Bhutan for on human lives, infrastructure and livelihood. Life (BFL), a transition fund of USD 43.1 million National Environment Commission Secretariat contributed by multilateral and private donors37 (NECS) and Ministry of Home and Cultural Affairs has been established to secure the permanent are the lead agencies for this NKRA. maintenance of Bhutan’s protected areas. Bhutan’s mountainous terrain and variation in Current situation and key agro-ecological zone renders it vulnerable to challenges impacts of climate change and disasters. There are increasing incidences of forest fires, risk of During the 15th Session of Conference of Parties GLOF, drying up of water sources, crop diseases, (COP15) of the United Nations Framework windstorm and erratic and high intensity of Convention on Climate Change (UNFCCC) in rainfall. In addition to these climate induced Copenhagen in 2009, the Royal Government of disasters, Bhutan falls within active seismic zone Bhutan committed to remain carbon neutral IV and V of the Indian tectonic plate where zone for all times. Additionally, Bhutan submitted its V comprises the area most at risk. Experts have Intended Nationally Determined Contributions predicted incidence of a major earthquake in the zone. (INDC) in September 2015 towards finalisation of Paris Agreement. This was subsequently ratified by the Parliament further re-iterating Bhutan’s Strategies pledge to remain carbon neutral. In order to address the challenges and achieve the NKRA, following strategies have been According to the 2nd Green House Gas (GHG) identified: inventory, Bhutan is a net sink with an estimated ▀▀ Mainstreaming environment in all sequestration capacity of 6.3 million tons of sectoral and local government plans. carbon dioxide (CO2) per year with an annual emission of 2.1 million tons. Although the ▀▀ Managing waste as a national flagship highest emission is the agriculture sector, it has programme. 36. The term “carbon” refers to GHGs such as Carbon dioxide (CO2); Methane (CH4) and Nitrous Oxide (N2O) and is measured in unit of CO2 equivalents (CO2 e). The term “Carbon neutral” means quantity of GHG emission does not exceed the sequestration capacity. 37. WWF, GCF, GEF, BTFEC, Bhutan Foundation, Bedari Foundation, Jeffrey Boal (PlowShare Group, Inc.) Carmen Busquets, Tammy and Bill Brown, DT Families foundation, Neville and Pamela Isdell, Micheal and Diane Moxness, Nicolas Oltramare, Philipp Family Foundation, Anne Reece, Roger and Victoria Sand. 54 ▀▀ Exploring eco-friendly public transport 4. Implementation of bilateral and system. multilateral environment programmes ▀▀ Enhancing mitigation and adaptation to This programme aims to ensure that climate change. Bhutan fulfils its bilateral and multilateral environmental agreements. It will also ▀▀ Strengthening preparedness and facilitate effective implementation of low response to both natural and man-made emission and climate resilient development disasters. activities. The programme will be implemented by NECS. Programmes 5. Enhancement of disaster risk The following programmes will be reduction and management implemented to achieve the NKRA: This programme aims to enhance Disaster Risk Reduction and Management through 1. Climate smart and disaster systematic and holistic approach of resilient development managing disaster. It will strengthen This programme aims to formulate and disaster preparedness, response and implement climate change responsive recovery capacity and also institute policies in agriculture and farming. effective post disaster mechanisms to The programme will promote green ensure disaster risk information and climate technologies, management resilient development at all levels of the of pests, diseases and disaster in the government and community at large. agriculture sector. The programme will be The programme will be implemented by implemented by MoAF. MoHCA. 2. Strengthening waste prevention 6. Weather and climate services and management for building climate resilience This programme aims to ensure strict This programme focuses on development enforcement of the Waste Prevention of reliable weather and seasonal climate and Management Act, 2009 and its forecasts, develop agro-met, aviation and regulations. The National Integrated Solid weather warning services. The programme Waste Management Strategy, 2014 will will be implemented by the National Centre be implemented to attain zero waste. The for Hydrology and Metrology (NCHM). programme will be implemented by the NECS. 7. Hydrology, cryosphere and water resources information 3. Strengthening water security and early warning services and enhancing management This programme aims to strengthen This programme aims to enhance institutional capacity including monitoring of environmental flow of major infrastructure for regular monitoring, risk rivers.The programme will be implemented assessment and early warning system of by the NECS. natural disaster. The programme will be implemented by NCHM. 55 TWELFTH FIVE YEAR PLAN VOLUME - I 8. Promote use of alternative 10. LG programme on carbon neutral, renewable energy climate and disaster resilient This programme aims to develop development renewable energy resources to supplement This programme aims to undertake the national energy needs by harnessing strengthening mitigation and adaptation solar and wind energy. The programme will measures through installation of bio-gas be implemented by MoEA. plants, promotion of quality and resilient infrastructures, and sustainable land 9. Safe, reliable eco-friendly and management and agriculture practices. The sustainable surface transport programme will be implemented by LGs. This programme aims to ensure low emission transport system and promote green transport. This programme will be implemented by MoIC. Table 3.12: Key Performance Indicators Baseline No. KPI Description Unit t Baseline Target Source Year Tonnes of CO2 National equivalent National emissions emissions / 6.1 Ratio 2013 1:3 1:3 reports to against national Tonnes of CO2 UNFCCC sequestration forest carbon sequestration Number of Agencies agencies Administrative with Disaster with disaster Data, Dept. Management preparedness / All 6.2 Numbers 2017 2 of Disaster and management/ Agencies Management, Contingency contingency plans MoHCA Plan developed in the 12th FYP period 56 NKRA 7 Quality education and skills This NKRA aims to achieve excellence in student learning outcomes were below the minimum learning outcomes comparable to leading expectations of their grade levels, unable to international standards while also reflecting the perform basic numeracy and literacy tasks; country’s rich culture and traditions. The NKRA and, (b) Majority of students were unable to will focus on transforming Bhutan’s Technical understand core concepts and apply knowledge and Vocational Education and Training (TVET) to real-life situations across grades and system and position it as a mainstream career subjects40. Similarly, the findings of the Education choice. without Compromise Report (2008) showed that children could not master the curriculum within Education and skills under this NKRA refers to the prescribed time, resulting in high primary early childhood care and development (ECCD), school grade repetition. An education quality general education, TVET, tertiary education, and survey of primary schools in Bhutan (Classes II non-formal and continuing education. Ministry and IV) conducted by the World Bank in 2007 of Education is the lead agency for this NKRA. found that the overall rate of learning was low. Current situation and key As per the Programme for International Student challenges Assessment for Development (PISA-D) Report 2018, it was found that students in Bhutan Bhutan is very close to achieving the goal of in general have higher success rates in items Universal Primary Education. As of 201838, the requiring lower cognitive skills, however, ANER was 96.8 percent constituting 97.4 percent significant gap exists in performance in more boys and 96.1 percent girls. The GER for basic demanding tasks. Overall, it was concluded that education (Class PP-X) stands at 103 percent and Bhutanese students have performed at par with GER for secondary (Class VII-XII) at 89.3 percent top PISA-D countries but significantly below for the same year. The GER for tertiary education Organisation for Economic Co-operation and (19-23 years old) within and outside Bhutan was Development (OECD) average. 24.2 percent39 in 2018. Recognising the importance of ECCD programme While accessibility has improved significantly, in laying foundation of human development and various studies have pointed out the need lifelong learning, ECCD programmes have been to urgently address issues about quality of intensified in the country in recent years. The education. In a diagnostic standardised test GER for ECCD has increased from 7 percent in conducted in 2008, it was found that: (a) Student 2013 to 23.4 percent in 2018. The concept of 38. MoE, Annual Education Statistics (2018). 39. ibid. 40. REC, The Quality of School Education in Bhutan: Realities and Opportunities (2009). 57 TWELFTH FIVE YEAR PLAN VOLUME - I ECCD is relatively new to Bhutan, and there is Bhutan is faced with dual challenge of high a need to further expand ECCD programme to youth unemployment and an increasing number reach out to all children to set strong foundation of youth entering the labour market43. Youth for improving educational outcomes. unemployment was estimated at 12.3 percent44 and large number of university graduates were Enrolling the un-reached group of children unable to find employment. It is projected continues to remain a challenge. It is estimated that 62,743 youth will enter the labour market that in 2018, about 3.2 percent or close to 2,840 over the 12th FYP period. Therefore, it is vital primary age children (6-12 years old) were still to ensure that the Technical Training Institutes out of school or were not enrolled in any form (TTIs) and TEIs have the required capacity to of structured learning. This group of children provide relevant and quality post-secondary is assumed to be those in remote and hard-to- education and training to address the high reach areas, children of nomadic communities youth unemployment issue. Bhutan Education and migrant population, children with learning Blueprint (2014-2024) aims to enrol at least 20 disabilities whose special learning needs are percent of the students at higher secondary level currently not catered for, and those who have in technical and vocational education courses by dropped out of schools. 2024. Currently, the combined annual intake capacity of the six TTIs, two institutes for Zorig Chusum, and While TVET is gradually gaining popularity one institute for tourism and hospitality in the in the country, TVET systems have not been country, is just over 800 students45. able to effectively align with the needs of the economy. This is largely due to challenges such Only about seven percent of class X passed as poor technical and institutional capacity students take up TVET courses. In comparison, to deliver relevant and quality programmes, countries such as Singapore, Finland, Germany weak coordination and collaboration among and Australia, more than 40 percent of students the key stakeholders, and weak institutional completing secondary education choose to enrol arrangement for education progression for TVET in TVET courses. These countries possess well graduates among others. There is also limited intake developed TVET systems capable of providing skills capacity in Technical Training Institutes (TTIs). that match their respective economies’ needs. In addition, TVET system in these countries have Over the years, remarkable progress has been clear pathways to progress within the vocational made in tertiary education. Currently, there are field as well as to transition into general education

19 Tertiary Education Institutes (TEIs) offering system. In contrast, in Bhutan, nearly 80 percent various higher education programmes to 11,311 of TVET courses are at Certificate level with limited students41. However, low competency of the progression opportunities. graduates and high unemployment among university graduates are challenges confronting Non-Formal Education (NFE) and Continuing tertiary education42. It was also noted that the Education programme continue to serve as TEIs do not adequately prepare graduates effective lifelong learning programmes in to become entrepreneurs nor offer relevant providing basic literacy and functional skills courses based on business needs. to youth and adult population who missed 41. MoE, Annual Education Statistics (2018). 42. MoE, Tertiary Education Roadmap (2016). 43. MoLHR, TVET Blueprint 2016-2026 (2016). 44. MoLHR, Labour Force Survey (2017). 45. MoE, Annual Education Statistics (2018). 58 formal education. In 2018, there were 6,017 ▀▀ Strengthening GNH based value NFE learners attending basic literacy and post education in schools and institutes. literacy courses in 560 NFE centres. The Royal Government continues to strengthen NFE Programmes programme to achieve higher adult literacy rate. The 2017 PHCB report showed increase in literacy The following programmes will be implemented rate from 59.5% in 2005 to 71.4% in 2017. to achieve the NKRA: Today, youth comprise about 20 percent of 1. Improve quality and inclusive school the total population, and they are also most education vulnerable to substance abuse, crime and This programme aims to provide inclusive violence, and suicide. Hence, it is critical that education to all children ensuring that GNH values and principles are deeply embedded no child is left behind irrespective of in the consciousness of the large population circumstances such as disabilities, of youth. In 2010, the Ministry of Education remoteness and economic disadvantage. implemented 'Educating for GNH' programme It is also aimed at providing quality as a strategy to embrace and advance the vision wholesome education by reducing of GNH through education. The GNH Survey dropouts and repetition. The programme 2015 has shown that 99 percent of population will be implemented by MoE. have met the sufficiency threshold of values. However, it was found that the percentage of the 2. Strengthen and expand vocational youth aged 15-24 who thought that ‘lying could education in schools never be justified’ decreased to 60 percent in 2015 This programme aims to enrol 2,500 compared to 80 percent in 2010. The survey also students in technical and vocational observed incidence of anger and other negative courses in school education system and emotions to be highest among younger age create pathways between mainstream groups. Therefore, the survey recommended education and vocational & technical the need to advance value education in schools education. The programme will be and educational institutes. implemented by MoE. Strategies 3. Enhance teacher development and In order to address the challenges and achieve support the NKRA, following strategies have been This programme aims to provide 80 identified: hours of professional development to each teacher in a year to enhance their ▀▀ Making teaching a profession of choice . knowledge and skills through in-service trainings and workshops at national, ▀▀ Strengthening ECCD and primary dzongkhag and school levels, and will education. also provide prestigious scholarships ▀▀ Shifting from examination based to and fellowships outside the country. The holistic and formative assessment. programme will also ensure efficient ▀▀ Creating pathways between mainstream deployment of teachers by subject. The and vocational education. programme will be implemented by MoE. ▀▀ Transforming TVET for sustainable development. 59 TWELFTH FIVE YEAR PLAN VOLUME - I 4. Enhance equity and quality of Tertiary 8. Improve quality and relevance Education of school curriculum and This programme aims to ensure equitable implementation access to tertiary education to meet long- This programme aims to reform, revise term human resources requirement of the and update the existing curriculum country in priority areas. The programme to meet emerging needs. This will will implement undergraduate scholarship include development of curriculum and programme both within and abroad, and assessment policies, and streamlining accredit TEIs by regional and international standards to guide reform and revision of accreditation bodies. The programme will existing curriculum and development of be implemented by MoE. new curriculum. The programme will be implemented by Royal Education Council. 5. Improve health and wellbeing of children and youth 9. Enhance the quality/standard of This programme aims to implement the Examination and Assessment Systems school feeding strategy as long-term This programme aims to strengthen investment in developing human capital. assessment and examination system The programme will also cover various by adopting international system such youth value and skill development as PISA. Affiliation with Cambridge for programmes such as life skill education, English language testing and development counselling, scouting, sports, and of National Education Assessment will establishment of youth centres. The also be the focus of the programme. programme will be implemented by MoE. The programme will be implemented by Bhutan Council for School Assessment and 6. Enhance adult literacy and lifelong Examinations. learning This programme aims to provide basic 10. Enhance quality and relevance of literacy and functional skills to adults, programmes particularly in rural areas who have missed This programme aims to offer postgraduate the formal education. It also provides programmes especially at masters and women friendly curriculum to prepare doctoral level. Under this programme, them as local leaders, bring positive impact the Royal University of Bhutan (RUB) on child care, healthy habits and natal care. aims to equip campuses with state of The programme will also help them benefit the art facilities for quality learning and from socio-economic growth through comprehensive student support services. improved literacy. The programme will be The programme will be implemented by implemented by MoE. RUB. 7. Transform technical and vocational 11. Enhance research, innovation and education and training scholarship This programme aims to ensure This programme aims to enhance research implementation of the priority areas capacity of the RUB through improvement of TVET Blueprint 2016 to improve in research infrastructure, facilities and access, quality and relevance to provide services, and strengthen partnerships with adequate supply of skilled workforce. The government agencies and international programme will be implemented by MoLHR 60 .partners. The programme will advocate 15. Excellence through Sports for All for a national policy on science, technology This programme aims to deliver sports and innovation that ensures creation of and recreation to all and promote a enabling environment for research. The vibrant sporting culture. The programme programme will be implemented by RUB. will focus on promoting active lifestyle (sports for all), sports participation (events 12. Promote innovation and and competitions) and sports excellence entrepreneurship (world, continental and regional games). This programme aims to develop The programme will be implemented by entrepreneurship culture and skills among Bhutan Olympic Committee. students to create job opportunities for themselves and others. The programme 16. LG programme on quality education will be implemented by RUB. and skills improvement This programme aims to enhance 13. Enhance management and learning outcomes by improving school professional development programme infrastructure and facilities, developing This programme aims to develop and skills and knowledge of teachers, and deliver high quality and need-based improving learning materials. The management development programmes programme will be implemented by the for mid-level managers of public sector, LGs. local governments, corporate and business sector and civil society organisations. The programme will be implemented by Royal Institute of Management. 14. Enhance quality of medical and health education and skills This programme aims to enhance quality of medical and health education and skills provided by the Khesar Gyalpo University of Medical Sciences of Bhutan (KGUMSB). This will be achieved through development of infrastructure, expansion of programmes, capacity development of faculty members, promotion of research, and updating existing curriculum to international standard. The programme will be implemented by KGUMSB. 61 TWELFTH FIVE YEAR PLAN VOLUME - I Table 3.13: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Students who score at least 60 percent Student’s each in Math, Science, 7.1 perfomance % 2017 14 20 BCSEA English and Dzongkha in BCSE in Bhutan Certificate for Secondary Examinations. Mean score in Reading, Reading: Mean score Math and Science 45.3 Reading: >50 in the core in the Programme Math: 38.8 Math: >44 7.2 subjects % 2017 BCSEA of International Science: Science: >50 in PISA Student Assessment 45.1 participation participation. (PISA-D) Graduates Graduates from from In- KGUMSB:80 KGUMSB:80 In-country Tertiary country TEIs RUB:70 RUB:75 Education Institutions, 7.3 Employed % 2016 RIM:90 RIM:90 DAHE, MoE who get employed within one JSW School JSW School within 12 months after year of of Law: NA of Law:100 graduation graduation TVET TVET graduates who graduates Administrative get employed within employed Data, Dept. six to 12 months after 2015- 7.4 within 6 % 80 90 of Technical graduation from TVET 2016 months to Education, Institutes within the one year of MoLHR country graduation 62 NKRA 8 Food and nutrition security This NKRA aims to enable our farmers to Current situation and key enjoy returns of their labour from the growing challenges economy. The NKRA will specifically aim to increase food production to enhance food self- Food self-sufficiency is defined as being able sufficiency and nutrition security. Nutrition to meet consumption needs (particularly for security will specifically address nutritional staple food crops) from own production rather needs of women and children in order to than by buying or importing46. Food subsistence reduce prevalence of malnutrition. Ministry of is defined as households (and their members) Agriculture and Forests is the lead agency for consuming (in real terms) equal to or more than this NKRA. the food poverty line, of Nu. 1,473.45 per person per month47. Figure 3.9: Trend in import of different food items Source: Bhutan Trade Statistics 2004-2016. 46. Joint SDC-IFPRI-Bhutan Project, Food Security and Food Sufficiency in Bhutan (2010). 47. NSB, Bhutan Poverty Analysis Report (2017). 63 TWELFTH FIVE YEAR PLAN VOLUME - I As per BLSS 2017, 2.7 percent of households Between 2010 and 2016 land used for agriculture experienced food insufficiency for one or more decreased by 15,453 acres51. Increasing forest months in a year. Average domestic production area and development activities will continue to of cereals was about 68 percent of the total exert pressure on the limited agricultural land. requirement between 2014 and 201648. Bhutan is only 46.7 percent self-sufficient in rice, 86 Outbreak of pest and diseases percent in maize, 84 percent in vegetables, and meat self-sufficiency is 37 percent. Imports of Pest and diseases continue to be a problem for dairy products like milk powder, cheese and the farming communities. As per the GNH Survey butter amounted to Nu. 1,166 million in 2017. 2015, about one in ten people (9.94 percent) Similarly, 90,000 MT of cereals amounting to Nu. reported having left their land fallow in the past 2,110 million were imported in 2017 . However, 49 one year specifically because of wildlife threats. the country has potential to increase production. In 2017, 1,284 MT of paddy, 5,151 MT of maize,

78 MT of buckwheat, 221 MT of vegetables and The general nutritional status of the people has 1,407 MT of potato were lost to wild animals and been improving consistently. The stunting rate pests. On an average, each household spent 48 of children aged 0-59 months reduced from days and 67 nights guarding crops from wild 33.5 percent in 2008 to 21.2 percent in 2015 animal in 201752. which was categorised as moderate public health significance as per WHO. The prevalence Farm labour shortage of stunting in children aged 6-59 months fell While 57.2 percent of the total labour force from 37 percent in 2008 to 22.3 percent in are engaged in agriculture sector, 53 percent 2015. Anaemia rate for children dropped from of farming households reported farm labour 80.6 percent in 2003 to 43.8 percent in 201550. shortage as a constraint to farming53. In Nonetheless, Bhutan has been experiencing addition, increasing feminisation of agriculture sporadic outbreaks of vitamin deficiencies, sector compounded by limited mechanisation particularly Vitamin B1 and B12 since 1998 and is becoming one of the leading constraints. occurrences have been recorded almost every According to PHCB 2017, 59.3 percent of the year. total employed women work in agriculture The following challenges hamper achieving food sector compared to 34.2 percent male. self-sufficiency and nutrition security. Loss of agricultural land and declining productivity Achieving food self-sufficiency depends on availability of cultivable and productive land. 48. DoA, MOAF, Agriculture Statistics (various years) 49. MoAF, RNR Statistics (2017). 50. MoH, National Nutrition Survey (2015). 51. DoA, MoAF, Agriculture Statistics (2017). 52. ibid. 53. DoA, MoAF, Agriculture Statistics (2016). 64 Strategies 2. Value chain and enterprise development In order to address the challenges and achieve This programme aims to provide critical the NKRA, following strategies have been support measures for commercialisation identified: of agriculture sector. Measures such as enhanced infrastructure, storage, ▀▀ Encouraging cultivation of fallow land. processing and value addition facilities, ▀▀ Expansion and strengthening of and facilitating micro credit will be irrigation system. core elements of this programme. The programme will be implemented by MoAF. ▀▀ Enhancing farm labour supply. ▀▀ Establishing network of post-production and marketing facilities. 3. Research and extension service This programme aims to undertake ▀▀ Strengthening price support for agriculture produce. adaptive and applied research in the areas of soil fertility, plant protection, post- ▀▀ Strengthening research and extension harvest and market linkages to develop services. targeted RNR products and services. The ▀▀ Farm mechanisation. programme will be implemented by MoAF. Programmes The following programmes will be implemented to achieve the NKRA: 1. Food and nutrition security This programme aims to enhance self- sufficiency in rice, vegetable, meat, eggs, dairy products, and fruits through assured irrigation and reducing fallow land and strengthening organic agriculture production. The programme will also strengthen animal and plant biosecurity and safety and enhance food safety. The programme will be implemented by MoAF in collaboration with LGs. 65 TWELFTH FIVE YEAR PLAN VOLUME - I Table 3.14: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Households that experience food Food insufficiency in the country 6.2 PHCB/ 8.1 Insufficiency in the last 12 months (i.e. % 2017 (8.1-rural, 2.4 BLSS in the country did not have enough food 2.9 urban) to feed all household members). Children <5 years that do National 8.2 Stunting not meet the height for age % 2015 21.2 15.14 Nutrition growth standards. Survey 66 NKRA 9 Infrastructure, communication and public services This NKRA aims to improve road network, better With a high public servant to citizen ratio of 1:13 public transport, boost connectivity and deliver spread across different public institutions54, effective and efficient public services. Ministry and the civil service to citizen ratio at 1:25, the of Works and Human Settlement, Ministry of bureaucracy is at risk of becoming complacent Information and Communications and Cabinet with weak accountability and coordination. Secretariat are the lead agencies for this NKRA. As a small country with a small population, opportunities exist to do things much more Current situation and key efficiently through optimised use of limited challenges resources. In the 12th FYP, the Royal Civil Service Commission will work with government agencies Public service delivery and undertake organisational development exercises where necessary, support greater Currently, about 174 government-to-citizen decentralisation through strategic redeployment and government-to-business services are of human resources, and build competency provided online, and community centres have framework to professionalise the civil service. been established in 200 gewogs to enhance accessibility to these services. In addition, Transport the Government Performance Management System (GPMS) was established in 2014 to Road network remains the primary means of ensure effective implementation of the five transportation due to the country’s geographical year plans and programmes through enhanced terrain and is key to Bhutan’s socio-economic accountability of public institutions. Reforms have progress. To improve connectivity, 18,395 km also been initiated to improve performance of the of roads have been constructed across the civil service through strengthening of performance country. A total of 180 Gewog Centre (GC) roads55 management and leadership development. have been blacktopped and 29 bridges56 have Despite efforts to provide many public services been constructed in the 11th FYP. The widening online, it still suffers from delays and inefficiencies. of 385 km of Northern East-West Highway will For instance, the GNH Survey 2015 found that be completed in the 12th FYP. The construction while distance to health care centre in Thimphu of the 76 km Gyelposhing-Nganglam National was the lowest (36.5 minutes), the average waiting Highway and 24 km Damchu-Chukha by-pass time (120.7 minutes) was the highest. 54. The Royal Address, 111th National Day, Samtse, 2018. 55. GNHC, Eleventh Five Year Plan Terminal Report (2018). 56. ibid. 67 TWELFTH FIVE YEAR PLAN VOLUME - I Figure 3.10: Trend in vehicle number Source: CBS & GNHR’s illustration from Annual info-comm and transport statistical bulletin, MoIC (2019). has been completed, and has significantly and quality of road network is a challenge. In reduced travel time57. As a result of efforts thus the 11th FYP, approximately Nu.1,995 million far, as per PHCB 2017, 93 percent of households had to be spent on road maintenance alone live within 30 minutes of walking distance from with an average of Nu. 399 million per year58. the nearest road head. Bhutan also suffers from limited regional and international connectivity. In addition to road, an efficient and reliable air transport is an integral part of economic growth Further, reliability of public transport is an issue and a primary means of connecting Bhutan to due to low frequency in the rural areas, while in the external world. Recognising its strategic urban areas inadequate public transport system importance, Paro International Airport has been has led to increasing traffic congestion. The expanded and improved, and improvements number of vehicles in the country is growing at were also made to the domestic airports an annual rate of 9-10 percent and the number of in Bumthang, Gelephu and Yonphula. Air light vehicles on the road has tripled since 200559. transport has been further strengthened with Moreover, given that the population of urban establishment of helicopter services. areas is set to increase significantly, investing in a reliable public transport system is critical. While significant milestones have been achieved, challenges remain. Owing to the rugged geographical terrain, ensuring reliability 57. ibid. 58. MoF, National Budget Report (2013 to 2018). 59. GNHC, Bhutan VNR Report (2018). 68 Information and communication ▀▀ Streamlining public services through Whole-of-Government approach. Seamless, affordable and reliable information ▀▀ Strengthening G2C Office. exchanges for all is the foundation for an efficient and interconnected business environment, ▀▀ Leveraging ICT as an enabler and an people-to-people connectivity, efficient industry. resource-use as well as transparent governance. ▀▀ Exploring alternative mode of transports Recognising the potential of information and such as electric vehicles, rope ways, and communications technology (ICT), Bhutan has cycling. made significant strides in pursuit of digital ▀▀ Ensuring all-weather road network transformation. Bhutan’s focus in recent years including blacktopping of remaining GC has been on strengthening ICT infrastructure roads. such as fibre optic connectivity, government intranet system and national data centre. Critical Programmes infrastructure such as national fibre optics backbone and Internet connectivity are already The following programmes will be implemented laid out in all the 20 dzongkhags. 85 percent to achieve the NKRA: of the population have access to Internet, more than 95 percent of households have 1. Safe, reliable, eco-friendly and sustainable mobile coverage , 0.3 million mobile phone 60 61 surface transport subscriber and many Government to Citizen and This programme aims to improve Government to Business services are provided accessibility, reliability and safety of transport online. Further, ICT received a breakthrough services through strengthened road safety with the launch of Bhutan’s first satellite-Bhutan1 enforcement, inclusive transport services and on 29th June, 2018. Three Bhutanese engineers eco-friendly public transport. The programme have been trained in Space Engineering to build will be implemented by MoIC. and launch the satellite. 2. Management and operation of air While significant progress has been made in transport services building ICT infrastructure, opportunities exist to This programme aims to improve air transport optimally leverage ICT to transform public service services by investing in safety, aeronautical delivery through improved coordination and infrastructure and human resource integration, adoption of frontier technologies development. The programme will also and enhancing digital literacy. explore expansion of air transport services by partnering with regional aviation organisations. Strategies The programme will be implemented by MoIC. In order to address the challenges and achieve 3. Digital transformation and innovation the NKRA, following strategies have been in the use of ICT and Media identified: This programme aims to enhance access, 60. GNHC, Eleventh Five Year Plan Terminal Report (2018). 61. ITU, Measuring the Information Society Report (2017). 69 TWELFTH FIVE YEAR PLAN VOLUME - I reliability and security of ICT systems and infrastructure, and enhance digital and media Box 3.4: Digital Drukyul Flagship Programme literacy. The programme will also promote This programme aims to leverage ICT for ICT as an industry to generate employment delivering health care, education, business and contribute to economic growth. The licensing and other critical public services programme will be implemented by MoIC. efficiently. An electronic patient information 4. Building and ensuring safe, reliable, system to centrally manage patient records secure and competitive aviation services of all health centers will be developed and This programme aims to strengthen regulatory about 1000 schools, hospitals and offices framework, build technical capacity of Bhutan will be provided with broadband Internet Civil Aviation Authority (BCAA) to enhance connection. Issuance of business licenses safety and security of aviation services. The of all categories, clearances for export and programme will be implemented by BCAA. import, and most commonly availed public services such as birth registration, death 5. Government performance registration, pension services, marriage management and public service certificate, vehicle services, issuance of various delivery enhancement programme permits, construction approvals and utility This programme aims to ensure effective services, will be streamlined and eased by implementation of 12th FYP programmes and enabling government agencies to interact and activities through strengthening of GPMS. coordinate more efficiently without burdening The programme will be implemented by the the citizens. Cabinet Secretariat. An indicative outlay of Nu. 2.5 billion has 6. LG Programme on transparent, effective been earmarked for the programme, and and efficient public service delivery implementation will be led by Ministry This programme aims to improve public of Information and Communications in service delivery through implementation of collaboration with Cabinet Secretariat, Ministry Standard of Procedures and Service Standards of Health, Ministry of Economic Affairs, Ministry particularly focusing on reducing Turn- of Finance and other relevant agencies Around-Time of services provided by LGs. The including the private sector. programme will be implemented by the LGs. 70 Table 3.15: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Satisfaction level of people on the delivery of public services by public Average agencies. Public services Bhutan satisfaction would include birth Living 9.1 rating for registration issuance of Scale (1-5) 2017 3.8 ≥4 Standards public CID card, issuance of Survey services passport, timber permit, security clearance and school admission process. Index as defined by ICT and telecommunication (ITU IDI value):[1]. Mobile cellular telephone subscriptions per 100 inhabitants [2] International internet bandwidth per internet user (Bit/s) [3] Percentage Inclusive of households with Index MoIC & 9.2 Digital 2016 3.74 6.5 computer [4] Percentage (out of 10) BICMA Index of households with internet access [5] Percentage of individuals using the internet [6] Fixed (wired) broadband subscriptions per 100 inhabitants [7] Active mobile broadband subscriptions per 100 inhabitants. 71 TWELFTH FIVE YEAR PLAN VOLUME - I NKRA 10 Gender equality The NKRA aims to promote gender equality by guideline on Gender Responsive Planning and creating enabling policies and adequate support Budgeting (GRPB) was developed in order and facilities for women and girls. The NKRA will to incorporate gender equality perspective also address the needs of women and girls and into budgeting process, policies, plans and remove barriers that limit their opportunities programmes. and potential. National Commission for Women and Children (NCWC) is the lead agency for this Despite the achievement of gender parity at NKRA. the primary level, the gender parity in tertiary education remains a challenge as female Current situation and key enrolment continues to be lower with 85 girls challenges for every 100 boys. Similarly, female enrolment in STEM subjects and vocational education is low Bhutan has made significant progress in closing compared to male. gender gaps in education, health, labour force and decision-making. Female literacy rate While the total labour force participation rate improved from 55 percent62 in 2012 to 59 increased from 60.4 percent in 2005 to 63.3 percent 63 in 2017, and gender parity in primary percent in 2017, the labour force participation education has been achieved. Girls’ enrolment rate is significantly higher among males at at the tertiary level has also improved from 35 73.1 percent compared to 52.2 percent for percent in 2005 to about 46 percent in 2018 with female. The female youth unemployment rate gender parity at 0.85. Maternal mortality rate is 13.2 percent which is higher than male youth has dropped from 255 per 100,000 in 2000 to 89 unemployment rate of 11.2 percent. Majority of in 201764. Composition of women in civil service the employed female are engaged in agriculture has increased from 32.4 percent in 2012 to 35.43 sector with 59.3 percent compared to male at percent in 2017. 34.2 percent (PHCB, 2017). Legal frameworks to promote and protect the Women’s representation at decision-making rights of women and children including Child level is comparatively lower than male Care and Protection Act of Bhutan, 2011; Child counterparts in the Parliament and LG with only Adoption Act, 2012; and, Domestic Violence 15.27 percent and 11.6 percent respectively. Prevention Act 2013 have been adopted. The Similarly, there are only 11.2 percent women at 62. NSB, Bhutan Living Standards Survey (2012). 63. NSB, Bhutan Living Standards Survey (2017). 64. NSB, Population and Housing Census of Bhutan (2017). 72 Figure 3.11: Unemployment rates by gender Source: Labour Force Survey Report, 2009-2016 executive level in the civil service. pursued and gender friendly toilets will be constructed in work places and Gender based-violence against women also public areas. Allowances for women remains one of the impediments to the in rural areas during initial months of realisation of gender equality and women’s child birth and free sanitary napkin to empowerment. While Bhutan has made all girl-students shall be explored. In significant achievements to eliminate violence order for women to enable women to against women, studies revealed high tolerance own and operate business, targeted rate of violence against women with 53.4 entrepreneurship supports and financial percent65. incentives will be explored. Protection system for women and children will be strengthened. Strategies ▀▀ Mainstream gender into policies, In order to address the challenges and achieve plans and programmes: the NKRA, following strategies have been As gender is a cross-cutting theme, identified: it will be mainstreamed into policies, plans and programmes of all agencies ▀▀ Implement specific support measures: and relevant interventions shall be Specific support measures that are formulated across the themes for gender friendly shall be pursued. promoting gender equality and child Establishment of new Crèches and wellbeing in the country. nursing rooms in work places will be 65. NCWC, A Study on Violence against Women/Girls in Bhutan (2017). 73 TWELFTH FIVE YEAR PLAN VOLUME - I Programmes 2. Gender equality promoted, women and girls empowered The following programmes will be implemented This programme aims to promote and to achieve the NKRA: strengthen women’s participation in leadership and decision-making processes. 1. Enhancing gender equality and The programme will also aim to increase strengthen child wellbeing women’s attendance and completion of non- and protection formal education programmes. Advocacy This programme aims to strengthen and awareness on violence against women gender-friendly working environment and children will be implemented, and and institute an effective and sustainable child care crèches will be established. This system for protection and empowerment programme will be implemented by the of women and children. The programme concerned agencies and LGs. will be implemented by the NCWC. Table 3.16: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Number of women parliamentarians in Women's the National Assembly Admin 10.1 representation in % 2018 15.2 >15.2 and National Council Data, ECB the Parliament as percentage of total parliamentarians Proportion of females Gender parity Annual to males in the tertiary 10.2 index in tertiary Ratio 2018 0.85 0.89 Education education institutes in education Statistics Bhutan. Study on Physical and/or sexual Violence Prevalence of intimate partner Against 10.3 violence against % 2017 6.1 <6 violence in the last 12 Women/ women/girls months Girls in Bhutan 74 NKRA 11 Productive and gainful employment This NKRA aims to create better opportunities percent and male 11.2 percent. Additionally, for assured employment. This will be achieved unemployment is more prevalent in urban areas by creating jobs in agriculture, tourism, mining, at 4.9 percent than 1.9 percent in rural areas. IT, hydropower, Cottage and Small Industries, The disaggregated data of youth also illustrate Medium and Large Industries, construction and that the unemployed youth are concentrated in trading sectors. Supply side constraints shall urban areas at 17 percent and only 8.6 percent be addressed by providing relevant skills and residing in rural areas. As per PHCB 2017, of the trainings to meet the labour market needs. total 8,137 unemployed, 2,550 were university Ministry of Labour and Human Resources is the graduates and 3,129 were higher secondary lead agency for this NKRA. graduates, 1,266 were class X graduates. Only 36 unemployed were TVET graduates. Current situation and key challenges Agriculture sector continues to be the largest employer accounting for 51.3 percent of the total Bhutan’s labour force participation rate employment, followed by wholesale and retail averaged around 63.8 percent between 2013 trade with 8.6 percent, public administration at and 2017. The unemployment rate in 2017 8.5 percent, and manufacturing at 7.6 percent. stood at 3.1 percent. Youth unemployment In terms of gender, the percentage of females rose from 9.6 percent in 2013 to 12.3 percent employed is higher in the agriculture and in 2017. Female youth unemployment was 13.2 wholesale and retail trade sectors. Employment Table 3.17: Labour Market Indicators, 2013-2017 66 Indicators 2013 2014 2015 2016 2017 Working Age Population 529,177 557,048 558,959 570,231 537,728 Labour Force 345,786 348,742 352,953 354,652 353,847 Total Persons Employed 335,870 339,569 344,293 347,130 342, 745 Persons Unemployed 9,916 9,174 8,660 7,521 11,102 Labour Force Participation Rate 65.3 62.6 63.1 62.2 65.7 Unemployment Rate 2.9 2.6 2.5 2.1 3.1 Youth unemployment rate 9.6 9.4 10.7 13.2 12.3 66. MoLHR, Labour Force Survey (various years). 75 TWELFTH FIVE YEAR PLAN VOLUME - I in agriculture consists mainly of unpaid self- Strategies employed small-scale subsistence farming with significant prevalence of underemployment In order to address the challenges and achieve given the seasonal nature of the sector. Figure NKRA, following strategies have been identified: 3.12 shows employment trend in agriculture sector. ▀▀ Creating adequate gainful jobs by accelerating tourism sector growth and Similarly, service sector employment is production and manufacturing CSIs. mainly wholesale and retail businesses. The ▀▀ Providing dedicated job placement manufacturing sector which has potential for services. regular paid employment with higher wages ▀▀ Skilling the workforce: Provide skills is currently providing the least jobs owing to low development training to meet labour economic diversification and entrepreneurship culture. market needs focussed on tourism and production and manufacturing Demographically, Bhutan is a young nation with sector. It will strengthen the technical 45.8 percent of the total population estimated to and vocational education and training be below the age of 24 years in 2017 and more system to equip TVET graduates with than two third of the population falls within high quality technical and vocational working age group. This provides Bhutan with an skills for employability both within and opportunity to reap the demographic dividend beyond Bhutan. if the right policy measures are adopted. It is ▀▀ Promoting entrepreneurship: Create estimated that around 67,805 new job seekers of conducive environment to which 93 percent of youth will enter the labour promote creativity, innovation and market in the 12th FYP. 41 percent will be with entrepreneurship through development Class XII qualification and 28 percent of the job of start-up ecosystem. seekers is projected to be university graduates. ▀▀ Incentivising LGs to create jobs: To ensure that Dzongkhags with high incidence of unemployment and employment in Figure 3.12: Employment trend in agriculture sector Source: Labour Force Survey, 2005-2016 76 agriculture receive adequate resources, criteria to determine resource allocation unemployment rate and people among local governments. employed in agriculture shall be used as Table 3.18: Projected job seekers in the 12th FYP 2018-19 2019-20 2020-21 2021-22 2022-23 Total Class XII job seekers 3,608 3,234 6,669 6,755 7,651 27,917 University Graduates 3,712 3,894 4,034 3,556 3,761 18,957 Diploma level 700 684 1,303 1,443 1,541 5,671 Certificate level 620 670 731 995 1,142 4,158 Currently Unemployed (Youth) 6,031 - - - - 6,031 Currently Unemployed (Adults) 5,071 - - - - 5,071 Total Jobseekers 19,742 8,482 12,737 12,749 14,095 67,805 Total Youth Jobseekers 14,671 8,482 12,737 12,749 14,095 62, 743 Source: Department of Employment & HR, MOLHR. Note: The projection excludes class X passed outs, who are in the age group of 15-18, as all are absorbed into class XI following the removal of class X cut off point from 2019 academic year. Currently unemployed youth and adults (11,102) are those who were unemployed at the time of the survey. Against the projected job seekers, about 61,811 Programmes new jobs are estimated to be created within the 12th FYP period under various sectors as The NKRA also requires linkage with NKRA 2 presented below. and NKRA 7. The following programmes will be implemented to achieve the NKRA: Table 3.19: Projected new jobs in the 12th FYP Sector New Jobs 1. Create productive and gainful RNR Sector 4,287 employment This programme aims to prepare Mining Sector 250 jobseekers for employment, create Medium and Large Industries 975 enabling and conducive environment Trading Sector 15,531 for both job seekers and employers. Construction 828 The programme will be implemented by IT and ITES Sector 2,000 MoLHR. Overseas Employment 6,000 2. LG programme on poverty reduction, Startup and CSIs 4,700 income generation and job creation Tourism 15,000 This programme aims to enhance rural Public sector 12,240 economy through establishment of cottage, Total 61,811 small and medium scale industries with job potentials. The programme will be implemented by the LGs. 77 TWELFTH FIVE YEAR PLAN VOLUME - I In addition, the Startup & CSI Development existing CSIs, Startups and new CSIs within Flagship Programme is also expected the 12th FYP period. to create about 4,700 additional jobs in Table 3.20: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year The indicator measures the national unemployment rate defined as the LFS 11.1 National unemployment rate % 2017 3.1 2.5 proportion of the total unemployed to 2017 the total labour force. The indicator measures the percentage of unemployed population in the age LFS 11.2 Youth unemployment rate % 2017 12.3 <6.5 group of 15 -24 years to the labour force 2017 in the same age group. 78 NKRA 12 Corruption reduced This NKRA aims to strengthen good Transparency Initiative show that about 32.5 governance and contribute towards building percent of Bhutanese think that the level of a corruption free society. This will be achieved corruption has “increased somewhat.” Also, as through promotion of ethical leadership, per the GNH Survey 2015, only 45.9 percent instilling integrity at the individual level of the population either rated "very good/ and strengthening systems and institutions good" on the government’s performance in through collaboration amongst all actors. fighting corruption. Anti-Corruption Commission is the lead agency for this NKRA. Strategies Current situation and key In order to address the challenges and challenges achieve the NKRA, following key strategies have been identified: Bhutan has made remarkable progress in preventing and combating corruption in the ▀▀ Mandatory mainstreaming of corruption reduction measures and country. Bhutan was ranked 26th cleanest KPIs into agencies’ and LGs’ plans. country among 180 countries and territories with an all-time high score of 68 points out of ▀▀ Strengthening corruption prevention 100 by Transparency International in 2017. measures both at individual and Bhutan’s rank improved by eight positions system level. from 33rd in 2012. Furthermore, Bhutan’s ▀▀ Inculcating ethical behaviour among progress in mainstreaming anti-corruption different sections of society and measures is also evident from its 2016 occupational groups. National Integrity Score of 7.95 out of 10. ▀▀ Strengthening institutional capacities of key law enforcement agencies. However, the 3rd National Integrity Assessment Report revealed that about 80 percent of the respondents perceive problem Programmes of corruption to be either “Very Serious” or “Quite Serious”. It also highlighted that The following programmes will be corruption in the form of abuse of function implemented to achieve the NKRA: and conflicts of interest are slightly more prevalent than bribery and embezzlement. 1. Enhance efficiency, effectiveness Similarly, findings of National Corruption and credibility of ACC Barometer Survey 2016 conducted by Bhutan This programme aims to transform ACC 79 TWELFTH FIVE YEAR PLAN VOLUME - I and its key stakeholders into highly achieve zero tolerance to corruption. efficient and responsive institutions that The programme will be implemented by command high degree of public trust ACC. and confidence through enhancement of professionalism, credibility, and 3. Improve public sector performance institutional capacity. The programme This programme aims to ensure will be implemented by ACC. value for money and accountability, transparency and effective service 2. Enhance mainstreaming of integrity delivery by public institutions. The and anti-corruption measures programme will be implemented by in agencies RAA. This programme aims to mainstream anti-corruption measures through promotion of transparency, accountability and integrity in all agencies including corporations and non-governmental organisations to Table 3.21: Key Performance Indicators No. KPI Description Unit Baseline Year Baseline Target Source Bhutan’s score on Corruption the Transparency Transparency 12.1 Perception International’s Score 2017 67 69 International Index Corruption Perception Index Transparency and accountability of public officials and public National 12.2 service delivery on a Score 2016 7.97 8.5 ACC Integrity Score scale of 0-10 based on the national integrity assessment survey. 80 NKRA 13 Vibrant democracy and decentralisation This NKRA aims to strengthen democracy 22 (Clause 1) of the Constitution of the and governance through decentralisation of Kingdom of Bhutan enshrines the ideals of decision-making, administrative and financial democratic and decentralised governance. authority with greater accountability. These “Power and authority shall be decentralized will be achieved through encouraging and devolved to elected Local Governments to people’s participation in electoral processes, facilitate the direct participation of the people in increased allocation of financial and human the development and management of their own resources to the LGs, and developing clear social, economic and environmental well-being.” roles and responsibilities between central agencies and the LGs. Election Commission Additionally, the LG Act 2009 and LG of Bhutan and Ministry of Home and Cultural Amendment Act 2014 translate the Affairs are the lead agencies for this NKRA. constitutional principles of decentralised governance into law and mandates for Current situation and key LGs. The LGs are also empowered through challenges enhanced fiscal decentralisation. All Dzongkhags, Gewogs and Thromdes receive Under the leadership of Their Majesties The five year resource based on a formulae Kings, the Royal Government has pursued and are empowered to spend funds based a proactive policy to devolve institutional on their priorities as per the LG Act 2009. powers to the grassroots since the 1980s. Further, the Constitution of the Kingdom of The establishment of Dzongkhag Yargay Bhutan 2008 states that: Tshogdu and Gewog Yargay Tshogchhung in 1981 and 1991 respectively, and Thromde Tshogde in 2011 with elected “Local Governments shall be entitled to levy, representatives in Thimphu, Phuentsholing, collect, and appropriate taxes, duties, tolls, and Gelephu and Samdrup Jongkhar Thromdes fees in accordance with such procedure and are some of the major decentralisation subject to limitations as may be provided by law” milestones. The bottom-up planning - Clause 18 (b). approaches were introduced in the 9th FYP with the initiation of bottom-up chiwog and “Local Governments shall be entitled to adequate gewog based planning. The decentralisation financial resources from the Government in the efforts culminated in the adoption of the form of annual grants”- Clause 18 (c). Constitution of the Kingdom of Bhutan in 2008 and introduction of Democratic In addition, during the 11th FYP, every Constitutional Monarchy thereafter. Article Gewog was allocated Nu. 2 million as Gewog 81 TWELFTH FIVE YEAR PLAN VOLUME - I Development Grant (GDG) and similarly, 1. Free and fair elections and electoral every Dzongkhag was provided Nu.7 million management each year as Dzongkhag Development This programme aims to ensure Grant (DDG). Implementation capacity of free and fair elections and electoral the LGs needs to be strengthened in view management through voter education of increased financial resources in the 12th and awareness programmes for all FYP. In order to provide clear guidance on citizens. Advocacy programmes to decentralisation, a decentralisation policy is encourage women’s participation, being formulated. review and simplification of electoral processes and research on electoral With regard to democracy, sustaining participation shall also be carried out. The participation in electoral process will programme will be implemented by ECB. continue to be a challenge. The National Council election 2018 witnessed voter 2. Strengthen Election Commission turnout of 54.3 percent compared to LG and of Bhutan National Assembly elections at 55.8 and 71.4 This programme aims to strengthen percent respectively. Further, GNH Survey Election Commission of Bhutan to ensure 2015 revealed that only 48 percent of people free and fair elections. The programme enjoyed sufficiency level in fundamental will be implemented by ECB. rights and 51 percent in political participation. 3. Enhance decentralisation at Local Strategies Governments This programme aims to formulate and In order to address the challenges and implement decentralisation policy to achieve the NKRA, following strategies have guide the LGs and provide clarity of roles been identified: and responsibilities, thus enhancing their capacity in the delivery of effective and ▀▀ Sustaining voter turnout. efficient public services. The programme ▀▀ Promoting political discourse on will be implemented by MoHCA. pledges. 4. LG programme on democracy and ▀▀ Implementing division of decentralisation enhancement responsibilities framework. This programme aims to increase citizen ▀▀ Implementing full-fledged annual participation in improving service delivery grants at gewog level. and decision-making process through implementation of citizen report card, Programmes and grievance-redressal mechanism and effective conduct of public meetings The following programmes will be (zomdus). Creation of more user groups, implemented to achieve the NKRA: self-help groups and committees, and trainings of the members will be encouraged. The programme will be implemented by the LGs. 82 Table 3.22: Key Performance Indicators Baseline No KPI Description Unit Baseline Target Source Year Eligible voters who Voter turnout cast their votes for for the National NA 71.46 NA≥71 13.1 the General Round % 2018 ECB Parliamentary NC 54.3 NC≥54 of National Assembly election election Eligible voters who Voter turnout for 13.2 cast their votes for LG % 2016 55.8 >55.8 ECB LG election elections at Gewog level New public New public services that services Administrative are delegated by Central 13.3 delegated from Number 2016 na 15 data,G2C agencies to the Local Central Agencies Office Governments. to LGs 83 TWELFTH FIVE YEAR PLAN VOLUME - I Box 3.5: Structure of Local Governments A Thromde 'A' has a Thromde Tshogde (TT). It is the highest decision-making body of the Thromde with the Thrompon as Chairperson A Dzongkhag has a Dzongkhag Tshogdu and an elected Deputy Chairperson from (DT). It is the highest decision-making body among its members, and is supported by the in the Dzongkhag with a Chairperson and a Thromde Administration. TT comprises of: Deputy Chairperson elected from among its • Not less than seven and not more than members, and is supported by the Dzongkhag ten elected functionaries, including the Administration which is headed by the Thrompon. Dzongdag. DT is composed of: • Gup and Mangmi as two elected representatives from each Gewog; • One elected representative from the Dzongkhag Thromde; • One elected representative each from Dzongkhag Yenlag Thromdes; and • The Dzongdag and all sector heads in the Dzongkhag Administration as observers. A Gewog has a Gewog Tshogde (GT). It is the highest decision-making body in the Gewog with Gup as the Chairperson and Mangmi as deputy Chairperson, and is supported by Gewog Administration. Gup is also the head of Gewog Administration.GT comprises of: • Gup and Mangmi; and • Not less than five and not more than eight elected Tshogpas. 84 NKRA 14 Healthy and caring society This NKRA aims to create a healthier Current situation and key nation by taking free, equitable and quality challenges healthcare to every Bhutanese. Quality healthcare services include preventive, Bhutan has made remarkable progress in curative and rehabilitative services to key health outcomes over the past several ensure every person, child or adult gets the decades achieving most of the Millennium resources needed to live a long and healthy Development Goals as shown in table 3.23. life. It also includes care needs of vulnerable groups such as senior citizens, child monks Significant investments have been made and nuns, persons with disabilities and in establishing health infrastructure and youth in conflict with law to provide targeted services. With an average of three health care services. Ministry of Health is the lead facilities for every 10,000 persons, about agency for this NKRA. 96 percent of the population have access to a health facility within two hours of walking distance. As per GNH Survey 2015, on average, 18 Dzongkhags reported 28 healthy days in a month except for Dagana & Bumthang as shown in figure 3.13. Table 3.23: Trends in key health indicators Indicators 1984* 1994* 2000* 2005** 2010*** 2012* 2017** Life expectancy at birth (years) - - 66.1 66.3 67.4 68.9 70.2 Crude birth rate 39.1 39.9 34.1 20 19.7 17.9 15.5 Crude death rate 13.4 9 8.6 - - 6.2 6.7 Total fertility rate - 5.6 4.7 3.6 2.6 2.3 1.7 Maternal mortality ratio (per 777 380 255 - - 86 89 100,000 live births) Infant mortality rate (per 1,000 102.8 70.7 60.5 40.1 47 30 15 live births) U5 mortality rate (per 1,000 live 162.4 96.9 84 61.5 69 37.3 34 births) Source: *National Health Survey, 1984, 1994, 2000, 2012, **PHCB 2005 & 2017, ***BMIS 2010 85 TWELFTH FIVE YEAR PLAN VOLUME - I Figure 3.13: Mean healthy days by dzongkhag Source: GNH Survey 2015 Table 3.24: Summary of health service coverage Year No. Indicators 2012 2013 2014 2015 2016 No. of doctors & density 1 194 (2.7) 203 (2.8) 244 (3.3) 251 (3.3) 299 (3.9) (10,000 population) 736 1070 1185

2 No. of nurses & density (10,000 population) 799 (10.9) 957 (12.8) (10.2) (14.1) (15.4) No. of pharmacists & density (10,000 3 11 (0.2) 9 (0.1) 14 (0.2) 15 (0.2) 23 (0.3) population)

4 No. of HAs & density (10,000 population) 578 (8.0) 608 (8.3) 632 (8.5) 643 (8.5) 658 (8.6) No. of Dungtshos (indigenous doctors) & 5 35 (1.0) 35 (0.5) 46 (0.6) 47 (0.6) 54 (0.7) density (10,000 population) No. of Menpas (indigenous health 6 63 (1.0) 82 (1.1) 90 (1.2) 100 (1.3) 105 (1.4) assistants) & density (10,000 population) No. and distribution of health facilities 7 222 (3.1) 236 (3.2) 262 (3.5) 266 (3.5) 271 (3.5) (10,000 population)

8 Ratio of beds per nurses 1.7 1.6 1.3 1.2 1.1

9 Ratio of nurses per doctors 3.8 3.9 3.9 4.3 4.3 Source: Human Resource Division, MoH, Health Information System, MoH. 86 The Constitution of the Kingdom of Bhutan Besides the profound implication on the mandates free access to basic public health quality of life of individuals, families and to all Bhutanese. Bhutan’s total health society, cost of treating patients with NCDs is expenditure is 3.8 percent of GDP, which exorbitant. Likewise, trend in mental health is predominantly government financed problems is on the rise. The incidence of (approximately 75 percent). The government suicide is becoming a public health concern. health sector expenditure over the 11th According to National Suicide Registry of FYP has averaged Nu. 4,024 million per Ministry of Health, a total of 191 individuals annum with an average expenditure growth completed suicide while 132 attempted of 75 percent. Household out-of-pocket suicide in 2017-18. Figure 3.14 presents expenditure is relatively low (estimated 25 the reasons provided by respondents who percent of the total health expenditure). attempted to commit suicide. Despite progress made, challenges remain. Minimal resources have been allocated for The following are the key challenges that promotive and preventive measures with need to be addressed in the 12th FYP. major portion of resources being spent on curative care. Curative services on average Non Communicable Diseases account for about 70 percent of the health expenditure while only 7 percent of the One of the most critical causes of concern is spending is for preventive services . the recent emergence of non-communicable diseases (NCD). Incidence of cardiovascular Communicable Diseases diseases, cancer, respiratory diseases and diabetes has risen considerably, causing 53 HIV/AIDS cases have increased from 2 in percent of the deaths in 2016. The major 1993 to 626 in 2017. TB case detection risk factors are consumption of alcohol, and treatment are progressing well with unhealthy diets and physical inactivity. treatment success rate of 90 percent with Figure 3.14: Reasons for attempting suicides Source: GNH Survey 2015 87 TWELFTH FIVE YEAR PLAN VOLUME - I death rate reduced to 14 per 100,000 from ensure financial sustainability of healthcare 73 in 2000. However, Multi Drug Resistant system in Bhutan. Streamlining systems (MDR) TB, and HIV-TB co-infection are and processes, use of technology enabled increasing and have become concerns. While solutions, strategic deployment of human Bhutan was declared malaria free in 2016, resources, and investment in preventive cross-border transmission is still an issue. healthcare must be prioritised. Malnutrition Human Resource The stunting rate of children aged 0-59 The health system suffers from shortage of months has reduced from 33.5 percent human resources particularly in specialised in 2008 to 21.2 percent in 2015 which fields. Long gestation period for training is categorised as “moderate public health doctors, difficulty in admissions due to significance” as per WHO. The prevalence limited slots and high academic requirement of stunting in children aged 6-59 months make it difficult to train competent and has fallen from 37 percent in 2008 to 22.3 adequate doctors. Bhutan’s three doctors percent in 2015. Similarly, anaemia rate for and 14 nurses per 10,000 people in 2016 is children dropped from 80.6 percent in 2003 comparatively lower than the regional and to 43.8 percent in 2015. Nonetheless, Bhutan international standards. has been experiencing sporadic outbreaks of vitamin deficiencies, particularly Vitamin Retaining good doctors and medical specialist B1 and B12 and occurrences have been has become a challenge. In addition, recorded almost every year. deployment of adequate female health staff to health facilities remains a challenge. Healthcare Financing Health System Efficiency Sustaining healthcare financing in the coming years, with gradual phasing out of Although access and coverage at the external support, will remain a challenge. national level is high, there exist disparity A review of the health expenditure trends at the disaggregated level. There is inequity over the last 10 years shows that the current in quality of services available at facilities health expenditure has been increasing at an among the same tier. There is disparity average rate of 16 percent and 10 percent in between regions in terms of out-of- pocket the 10th and 11th FYP periods respectively67. (OOP) expenditures. The average annual Similarly, current health expenditure grew OOP expenditure ranges from Nu. 50 in by almost 75 percent in the 11th FYP period southern Samdrup Jongkhar to Nu. 5000 in whereas domestic revenue only by 38 highland Gasa. percent. The three-tiered referral system needs to be Finding ways to deliver more with less streamlined as lower health tiers are being is the only long-term viable solution to bypassed, resulting in overburdening of the 67. MoF, Annual Financial Statements (various years). 88 national and regional referral hospitals, and status of all Bhutanese through proactive underutilisation of district hospitals and basic implementation of comprehensive public health units. The three-tiered system which healthcare services and healthy habits like was instituted to improve access to health food, sleep, exercise, meditation etc. The services lacks mechanism to discourage self- programme will be implemented by MoH. referral, particularly to JDWNRH. 3. Medical services This programme aims to improve access to Strategies health facilities and strengthen quality and effectiveness of curative and rehabilitative In order to address the challenges and services provided by all health facilities achieve the NKRA, following key strategies in the country. The programme will be have been identified: implemented by MoH. ▀▀ Curbing non-communicable diseases. 4. Medicines, healthcare technologies ▀▀ Upgrading skills of health workers and infrastructure and ensuring adequate need-based This programme aims to ensure deployment. development of health infrastructure and reliable supply of essential inputs such as ▀▀ Strengthening tertiary healthcare medicines and healthcare technologies. services including referral system. The programme will be implemented by ▀▀ Strengthening healthcare services MoH. and facilities at dzongkhag and gewog level. 5. Traditional medicine services This programme aims to enhance access ▀▀ Automating and digitising and quality of traditional medicine services patient information for efficient in the country. The programme will be management, tracking and follow-up. implemented by MoH. Programmes 6. Improved access to quality tertiary healthcare services The following programmes will be This programme aims to improve quality implemented to achieve the NKRA: and access to Tertiary Healthcare services through introduction of new specialised 1. Governance, health workforce services, improving quality of existing and financing ones, and improving overall efficiency This programme aims to develop and effectiveness of hospital services. healthcare workforce both in numbers and The programme will be implemented by skills and improve management efficiency. JDWNRH. The programme will be implemented by MoH. 7. Enhance quality of medical and health education and skills 2. Health promotion and disease This programme aims to increase supply prevention of quality doctors through building of in- This programme aims to improve health country capacity. The programme will be implemented by KGUMSB. 89 TWELFTH FIVE YEAR PLAN VOLUME - I 8. Strengthening of medical products 12. LG programme on community health regulatory services enhancement and water security This programme aims to ensure This programme will focus on construction, availability of safe and quality medicinal maintenance and improvement of health products through capacity building of infrastructure such as Dzongkhag hospitals, drug regulators and creation of safe satellite clinics, and BHUs. It will also aim use of drugs among general public. The to reduce incidences of mother and child programme will be implemented by Drug mortality, and death due to suicides, Regulatory Authority. NCDs and alcohol. The programme will improve amenities such as 24x7 safe 9. Drug demand and supply reduction drinking water and construction of pour This programme aims to reduce supply flush toilets for the poorest households, of narcotic drugs by building capacity of and improve provision of health services law enforcement agencies and relevant for special needs. The programme will be personnel. It will also strives to reduce implemented by the LGs. demand, through awareness programme at schools, training teachers on science of addiction, building capacity of addiction professionals, and educating parents and community on the ill effects of substance abuse. The programme will be implemented by Bhutan Narcotic Control Agency. 10. Strengthening patient safety and quality of health care services This programme aims to improve quality of services provided by health facilities in the country to ensure quality healthcare outcomes and patient safety. The programme will be implemented by Bhutan Health and Medical Council. 11. Sustaining primary healthcare services in Bhutan This programme aims to strengthen financial sustainability of healthcare services through effective management of the Bhutan Health Trust Fund. The programme will be implemented by Bhutan Health Trust Fund. 90 Table 3.25: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Deaths due to suicide which is defined as an act of killing Suicide per Suicide oneself or death caused by self- Prevention 14.1 100,000 2016 12 <12 rate directed injurious behaviour Action population with any intent to die as a result Plan, MoH of the behaviour. Total deaths from four NCDs Premature (cancer, diabetes, cardiovascular mortality National 14.2 diseases and chronic respiratory % 2017 34 <25 rate due to STEPS diseases) against the total NCDs deaths 91 TWELFTH FIVE YEAR PLAN VOLUME - I NKRA 15 Sustainable human settlements This NKRA aims to improve livability, safety and of villages developed around administrative sustainability of human settlements through and monastic centres. Patterns and forms of access to adequate affordable housing, efficient settlements were mostly shaped by availability and effective municipal services, and clean and and topography of land, water and livelihood green public spaces for social engagement. opportunities. However, with the start of modern Ministry of Works and Human Settlement is the development, new forms of settlements based lead agency for this NKRA. on trade and commerce developed leading to rapid urbanisation and increasing trends of Current situation and key rural-urban migration as shown below. challenges Affordable housing is an integral component of human settlement. Traditionally, housing Traditionally, settlements in Bhutan consisted Figure 3.15: Cumulative net migrants by dzongkhag Source: CBS & GNHR’s illustration from PHCB 2005 & PHCB 2017. 92 shortage was not an issue due to the safety net need to be upgraded to ensure safety and provided by the joint family system. However, provide access to modern amenities where with development and increasing rural-urban required. migration, providing adequate affordable housing has become a critical issue especially in In terms of sanitation facilities, 74.8 percent urban centres owing to increasing nuclearisation of households in the country have improved of families. PHCB 2017 reported that owner- sanitation facilities68 as of 2017. The figure 3.16 occupied housing units decreased to 50.7 illustrates the percentage of households without percent in 2017 from 59.1 percent in 2005, while improved sanitation by dzongkhag. those who rented housing units increased to 34.9 percent, with 62 percent of households in In addition, recreational and learning facilities urban areas renting their dwellings. Affordable such as parks and public library have been housing deficit has become a critical issue in developed over the past plan period. To urban areas especially for middle and lower enhance safety of urban communities, CCTVs income groups. were installed at various locations in Thromdes to curb crime and traffic offenses. The 1,134 government constructed housing units and the surge in private investment in Although efforts to ensure livability, safety housing sector in the recent years have helped and sustainability of human settlement are narrow the gap between supply and demand being pursued, multiple challenges remain. for housing. However, housing sector continues An estimated 10 percent69 of Thimphu city’s to be plagued with high import of materials, population lives in informal settlements. machineries and labour leading to an increasing About a quarter of households (41,039)70 lack outflow of foreign currency. Moreover, the access to improved sanitation facilities. Waste existing houses which are not disaster resilient management is a concern. Solid waste is Figure 3.16: Households without improved sanitation by dzongkhag Source: CBS & GNHR’s illustration from PHCB 2017 68. NSB, Population and Housing Census of Bhutan (2017). 69. GNHC, Bhutan Vulnerability Baseline Assessment (2016). 70. NSB, Population and Housing Census of Bhutan (2017). 93 TWELFTH FIVE YEAR PLAN VOLUME - I collected and disposed at landfill sites but lacks buildings. scientific treatment71. ▀▀ Mainstreaming measures to reduce vulnerability to disasters. In addition, there is need to improve livability through development of clean and green spaces ▀▀ Enhancing access to safe, inclusive and for social engagement, recreation and sports green public spaces. including footpaths. Safety has become an ▀▀ Promoting affordable housing and emerging issue with the increase in proportion homeownership schemes. of people who reported being victims of crime ▀▀ Improving efficiency and effectiveness of in both rural and urban areas. As per the GNH Thromde and municipality services. Survey 2015, the proportion of people who reported being victims of crimes in rural areas ▀▀ Implementing Comprehensive National increased from 3.3 percent in 2010 to 6.5 percent Development Plan 2030. in 2015, and in urban areas from 4.2 percent to 10.6 percent. Programmes Strategies The following programmes will be implemented to achieve the NKRA: In order to address the challenges and achieve the NKRA, following strategies have been 1. Enhance sustainability identified: of human settlement This programme aims to ensure an ▀▀ Promoting green and energy efficient integrated and regionally-balanced Figure 3.17: Households practising various modes of waste disposal Source: GNH Survey 2015. Note: ‘Others’ mode of waste disposal includes: dumping on open land, dumping in forest, dumping in rivers/forests, and others 71. MoWHS, Bhutan National Human Settlement Strategy (2017). 94 development. The programme will focus order, prevent crimes and protect lives and on improving livability through planning, property to ensure safety and security in provision of infrastructure, improvement human settlements. The programme will of services and promotion of affordable be implemented by RBP. housing. The programme will be implemented by MoWHS. 4. LG programme on livability and human settlement development 2. Pursue green growth This programme aims to enhance in construction sector livability, safety and sustainability of This programme aims to improve quality human settlements by improving urban infrastructure and promote green and amenities and infrastructures such as disaster-resilient construction technologies roads, footpaths, drainage, drinking water by professionalising construction sector. and public transport. The programme will The programme will be implemented by also aim to develop proper settlement MoWHS. plans and improve waste and pollution management systems. The programme will 3. Strengthen safe and secure society be implemented by the LGs. This programme aims to maintain law and Table 3.26: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Percentage of households that have access to Households with improved sanitation BLSS/ 15.1 improved sanitation % 2017 74.8 100 (sewerage network, septic PHCB facilities tank with soak pit, on-site treatment facility). Proportion of population Proportion of that feels safe while population that feels GNH 15.2 walking in and around their % 2015 62.72 >63 safe while walking in the Survey neighbourhood as defined neighbourhood by GNH Survey. Timeline by Timeline by which a policy which a policy for for affordable housing 15.3 affordable housing/ Date NA NA 2020 GNHC and home ownership is home ownership is developed. developed 95 TWELFTH FIVE YEAR PLAN VOLUME - I NKRA 16 Effective justice services This NKRA aims to strengthen justice services Current situation and key and institutions through harmonisation of challenges conflicting laws, enhanced coordination among justice sector agencies, improving Bhutan has maintained an independent efficiency of judicial services, and ensuring judiciary that provides all Bhutanese citizens’ awareness on laws and procedures. unimpeded access to law and legal process. The NKRA shall also focus on enhancing To ensure equitable access to justice, an corrective and rehabilitative measures for indigent accused is guaranteed with legal aid reintegration of inmates into the society. from the State. Royal Court of Justice is the lead agency for this NKRA. While number of cases registered has decreased since 2014, the number of Figure 3.18: Summary of case statistics from 2007-2017 Source: Annual Report of Judiciary (2007-2017). 96 pending cases has been increasing over the reintegrate inmates and reduce recidivism years resulting in decrease in the proportion are being initiated. of cases decided as shown in Figure 3.18. Overall, as per BLSS 2017, it was reported Towards enhancing access to judicial that about 75.7 percent of respondents services for all by 2023, efforts have already expressed satisfaction with justice services, been made to provide legal services such which includes judicial services, crime as marriage certificate, attestation of services, traffic services, security clearances, documents, child adoption, and organ fire services and rescue and emergency transplant online. Inadequate qualified services. legal personnel continues to remain a challenge for the Judiciary sector in providing Strategies specialised legal services. To address this shortage, two legal institutions have been In order to address the challenges and established in the country. Bhutan National achieve the NKRA, following strategies have Legal Institute creates awareness on legal been identified: knowledge for general public and provides legal education and training for in-service ▀▀ Enhancing human resource capacity and redeployment based on case legal personnel. Jigme Singye Wangchuck load. (JSW) School of Law has been established and offers law degrees with curriculum on ▀▀ Improving coordination among international and national laws. judiciary sector agencies to provide end-to-end integrated justice In addition, to resolve disputes amicably and services. expeditiously, Alternative Dispute Resolution ▀▀ Harmonising conflicting or (ADR) system has been promoted. In 2017, inconsistent laws. about 42.3 percent of the cases were settled ▀▀ Promoting ADR and mediation within through ADR. A Bar Council has been communities. established in order to professionalise legal counsel services. ▀▀ Strengthening rehabilitative and reformative programmes for inmates. The country has witnessed an increase in crime rates and crime-related complexities Programmes that are becoming resistant to traditional policing methods. The crime rate for The following programmes will be 2017 stood at six percent and as per the implemented to achieve the NKRA:

2015 GNH Survey Report, 29.6 percent of the respondents reported feeling either 1. Strengthen effective delivery 'completely unsafe' or 'unsafe' when walking of legal services alone at night. This programme aims to strengthen delivery of prosecution and legal Efforts to institute formalised reformatory services of the state by strengthening and rehabilitative programmes in prisons to institutional capacity of Office of 97 TWELFTH FIVE YEAR PLAN VOLUME - I the Attorney General (OAG). The capacity of relevant institutions and programme will also strengthen their services. The programme will coordination and partnership within the conduct trainings on relevant and justice sector. The programme will be updated law and legislations, and ADR. implemented by OAG. Basic legal awareness programmes for general public will be provided. The 2. Enhance judicial accessibility through programme will be implemented by improved services and management Bhutan National Legal Institute (BNLI). systems This programme aims to improve 4. Strengthen capacity of Jigme Singye accessibility of justice by strengthening Wangchuck School of Law the institution and capacity of judicial This programme aims to establish JSW service providers, and also promote School of Law as the country’s premier accessibility to equal justice for all tertiary legal educational institution. including vulnerable groups. The The programme will be implemented by programme will focus on infrastructure JSW School of Law. development, strengthening e-judicial services, establishment of specialised 5. Strengthen safe and secure society courts for environment, family, women This programme aims to ensure and children, and capacity development rehabilitative programmes in prisons of legal professionals and support staff. for meaningful social reintegration of The programme will be implemented by inmates and reduce recidivism. The the Royal Court of Justice. programme will be implemented by RBP. 3. Strengthen administration of justice services This programme aims to improve accessibility to justice by strengthening Table 3.27: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Public satisfaction in Justice services. Justice services Public satisfaction in includes judicial services, crime 16.1 % 2017 67.77 >76.25 BLSS Justice services services, traffic services, security clearances, fire services and rescue and emergency services. Reduction of recidivists in the 16.2 Recidivism % 2017 4.7 4.5 RBP prisons. 98 NKRA 17 Sustainable water This NKRA aims to ensure availability of Nyeramachhu, Jomotshangkhachhu and adequate water for drinking and irrigation. Sherichhu72. National Environment Commission is the lead agency for this NKRA. Although access to safe drinking water has improved over the years, drinking as well as Current situation and key irrigation water shortage is a growing challenge. challenges According to the National Irrigation Master Plan 2016, of the total 105,682.43 acres of cultivated Bhutan has one of the highest per capita water land, 64,248 acres still depends on rain-fed resource availability with 94,500 m3/capita/ traditional irrigation system. annum. There are four major river basins, viz. Amochhu (Toorsa), Wangchhu (Raidak), According to PHCB 2017, only about 81 percent Punatsangchhu (Sunkosh) and Drangmechhu of housing units have reliable water supply (Manas). The three smaller river basins include during the critical hours of the day (5am-8am, 11am-12pm and 5pm-9pm), and about 1.6 Figure 3.19: Households without reliable water supply by dzongkhag Source: PHCB 2017 72. NECS, Integrated Water Resource Management Plan (2016). 99 TWELFTH FIVE YEAR PLAN VOLUME - I percent of households still need to travel for at Strategies least 30 minutes to the nearest water sources. In order to address the challenges and achieve As per the assessment carried by MoH, 69 the NKRA, following key strategies have been communities comprising of 946 households identified: in the country are reported to have no water source and another 48 communities comprising ▀▀ Building and rehabilitating adequate and of 888 households have inadequate water climate resilient water infrastructure. source. Dried-up sources have been reported ▀▀ Improving drinking water quality and in 19 communities comprising 336 households. safety. Furthermore, about 43 percent of the total urban population is supplied with 24 hours, 46 ▀▀ Providing adequate irrigation water. percent with eight to 12 hours and 11 percent ▀▀ Implementing water legislation and with less than eight hours73 of drinking water. governance. ▀▀ Exploring creation of a dedicated water The primary reasons identified for intermittent agency. supply of water are poor demand management, inadequate infrastructure, poor distribution network, ineffective enforcement of regulations, Programmes and unreliable source. The following programmes will be implemented A major challenge for ensuring continuous to achieve the NKRA: water supply is drying up of water sources. Integrated Watershed Management Plan is being 1. Sustainable natural resource management implemented in order to enhance sustainability and utilisation of water resources. Efforts to ensure water This programme aims to undertake safety thus far have been limited to schools and effective management of wetlands and hospitals. While requirement of water safety watersheds geared towards ensuring plans to ensure safety and efficient management reliable drinking and irrigation water. The of drinking water has been encouraged, effective programme will be implemented MoAF. implementation is a challenge. 2. Climate smart and disaster resilient Effective implementation of water legislation development is necessary to ensure that assigned roles This programme aims to explore and responsibilities of nodal agencies are alternative water sources to contribute implemented. Currently a host of agencies such to ensuring continuous drinking and as MoWHS, MoH, MoAF, NECS, Thromdes, and irrigation water. The programme will be Dzongkhags are involved in the management implemented by MoAF. of water resources in the country leading to duplication of efforts, weak coordination and 3. Water, Sanitation and Hygiene (WASH) dispersed accountability. This programme aims to develop, monitor and evaluate water safety plans in both rural and urban areas. The programme will be implemented by MoWHS. 73. Urban Water Supply Plan and Update 2014. 100 4. Enhance sustainability of human of water services. The programme will be settlement implemented by NCHM. This programme aims to assess and ensure efficiency, effectiveness and sustainability 6. LG programme on community health of water services. The programme will be enhancement and water security implemented by MoWHS. This programme aims to enhance community health and provide reliable 5. Weather and climate services for drinking water at LG level. The programme building climate resilience will be implemented by the LGs. This programme aims to assess national water resources for ensuring continuity Box 3.6: Water flagship programme An indicative outlay of Nu. 3 billion has been earmarked for the programme. The programme This programme aims to provide access to 24x7 implementation will be led by the National safe drinking water to both rural and urban Environment Commission Secretariat (NECS) households. The programme will undertake and Ministry of Works and Human Settlement construction of new water supply schemes, in collaboration with LGs, Ministry of Health, rehabilitation of existing water supply schemes, Ministry of Agriculture and Forest, and Ministry water source protection and water quality of Finance. testing and surveillance. The programme will also ensure adequate irrigation water. In order to ensure efficiency and reliability of water supply, creation of an agency for water supply services shall be explored. Table 3.28: Key Performance Indicators Baseline No. KPI Description Unit Baseline Target Source Year Households Both urban and rural with access to households that have 17.1 24 hours supply access to 24 hours supply % 2017 63 100 BLSS of safe drinking of safe/piped drinking water water in the dwelling Total area of Chhuzhing under assured irrigation with perennial water Chhuzhing area source (reliable water 17.2 under assured Acre 2015 39,578 48,350 MoAF source, intake and stable irrigation irrigation channels and an irrigable command area). 101 TWELFTH FIVE YEAR PLAN VOLUME - I 3.7 Local Government Key LGs and Central agencies to align their Result Areas 12th FYP plans and programmes. This was followed by formulation of KPIs, targets, The LG plans are formulated based on the baselines and outputs under the relevant LG Act, the 12th FYP Preparation Guideline, LGKRAs. These were further deliberated at the Local Development Planning Manual, the respective Gewog and Thromde Tshogdes Assignment and Division of Responsibilities and Dzongkhag Tshogdus for finalisation Framework between LGs and Central and approval. agencies, Structural Plans and Local Area plans, and the 12th FYP Grants allocation There are 10 LGKRAs for 10 dzongkhags and to Dzongkhags, Gewogs and Thromde four thromdes (Category-A) and 11 LGKRAs ‘A’s along the principles espoused in the for 10 dzongkhags with additional LGKRA, strategic framework for “Enhancement of “Improved and sustained livelihood of Gross National Happiness”. highlanders.” The LGKRAs are as follows: LGKRA 1: Gainful employment created and The LGKRAs are socio-economic local economy enhanced development results and targets formulated to achieve one or more relevant AKRAs LGKRA 2: Food and nutrition security or NKRAs. In order to enhance and enhanced achieve implementation efficiency and LGKRA 3: Community health enhanced and gains, Coordination, Consolidation and water security ensured Collaboration (Triple C) has been promoted and applied as the fundamental principle LGKRA 4: Quality of education and skills and device underpinning all goals, strategies improved and programmes. LGKRA 5: Culture and traditions preserved and promoted The plan preparation process for the LGs involved participatory approaches, LGKRA 6: Livability, safety and sustainability consultations and building consensus of human settlements improved with the citizens at the community LGKRA 7: Transparent, effective and level. Following the 12th FYP preparatory efficient public service delivery enhanced guideline sensitisations by GNHC, the local LGKRA 8: Democracy and decentralisation administrations led by Dzongdags, Gups and strengthened Thrompons respectively formed local level 12th FYP Planning Committees with members LGKRA 9: Carbon neutral, climate and comprising elected functionaries and civil disaster resilient development enhanced servants. These Committees undertook LGKRA 10: Gender equality promoted, further consultations with citizens and women and girls empowered communities at the Chiwog level to discuss developmental issues and priorities and LGKRA 11: Improved and sustained assess needs and aspirations of the people. livelihood of highlanders Furthermore, dialogues were held between 102 The LG programmes, strategies and detailed Resources activities can be found in 12th FYP Volume III. The total financial resource for the 12th FYP is estimated at Nu. 280,773 million of which 3.8 Fiscal Outlook and Resource domestic revenue is Nu. 217, 728 million and Allocation Framework the grant Nu. 63,044 million. Of the domestic revenue, tax revenue is Nu. 150,017 million 3.8.1 Fiscal outlook for the 12th FYP and non-tax revenue is Nu. 67,711 million. The estimated revenue is expected to fully cover The fiscal policy objective in the plan period the current expenditure and finance at least 21 will be to ensure sustained economic growth percent of capital expenditure. with stability through fiscal consolidation by On average, the domestic revenue is projected broadening tax base, rationalising capital to grow at 10 percent mainly driven by growth in and recurrent expenditures. Further, the the non-tax revenue followed by tax revenue on linkage between annual budget and annual account of commissioning of new hydropower performance targets will be strengthened projects and new tax measures. The growth of to improve efficiency and effectiveness of indirect tax will be adversely affected by the GST resource utilisation. regime implemented in India. Excise duty refund from India, which contributed about 34 percent Based on the medium-term economic of indirect tax will no longer be available. outlook, efforts shall be made to achieve the following targets: In order to strengthen domestic revenue mobilisation, a medium-term revenue strategy ▀▀ Maintain average fiscal deficit below will be adopted, which will outline the measures 3 percent of GDP. to broaden tax base to maintain tax to GDP ratio above 12 percent. Replacing the sales tax regime ▀▀ Cover at least 80 percent of total with modern GST will be critical to achieve the expenditure by domestic revenue. fiscal targets besides introducing new taxes and ▀▀ Maintain tax to GDP ratio at 12 revising existing tax rates. Preparatory works percent. to introduce GST were initiated towards the end of 11th FYP. In addition, the existing fiscal ▀▀ Maintain budget variance below 3 incentives and tax exemptions will be reviewed percent. and rationalised. ▀▀ Maintain non-hydro debt below 35 percent of GDP. The total grant for the plan period is estimated at Nu. 63,044 million of which external grant is The resource envelope for the 12th FYP has Nu. 61,651 million and internal grant from trust been determined as shown in table 3.26. funds is Nu. 1,393 million. Grant constitutes 22.4 percent of the total resources and will finance at least 54 percent of the capital expenditure. Sources of external grant includes the GoI which forms major portion of the external grant. Other sources are the EU, Japan and UN agencies. 103 TWELFTH FIVE YEAR PLAN VOLUME - I Table 3.29: Fiscal Framework for 12th FYP No. Particulars 2018/19 2019/20 2020/21 2021/22 2022/23 Total A Total Resources 38,299 60,398 61,305 61,120 59,651 280,773

1 Domestic Revenue 33,944 45,750 43,209 46,118 48,706 217,728 i Tax 25,037 26,315 30,244 33,042 35,379 150,017 ii Non-tax 8,907 19,436 12,965 13,077 13,327 67,711 o/w interest receipts 1,426 3,580 3,539 3,532 3,492 15,570

2 Grants 4,355 14,648 18,096 15,001 10,945 63,044 i External Grants 4,151 14,419 17,681 14,656 10,744 61,651 o/w GoI 1,718 11,684 12,730 10,530 8,338 45,000 o/w Others 2,434 2,735 4,951 4,126 2,405 16,651 Internal Grants (Trust ii 204 229 414 345 201 1,393 Funds) B Total Expenditure/Outlay 39,620 66,207 68,944 67,961 67,283 310,016

1 Current 28,848 39,496 41,068 41,233 43,250 193,895 i Primary Current 27,510 35,727 37,121 37,101 38,852 176,311 ii Interest payments 1,338 3,770 3,947 4,132 4,398 17,584

2 Capital 10,772 26,711 27,876 26,728 24,033 116,121 C Fiscal Balance (1,321) (5,809) (7,639) (6,842) (7,632) (29,243) In percent of GDP (0.7) (2.7) (3.2) (2.6) (2.6) (2.4) Primary Balance 17 (2,040) (3,693) (2,710) (3,234) (11,659) In percent of GDP 0.01 (0.95) (1.56) (1.04) (1.12) (0.9) 104 Expenditure Financing The total expenditure for the 12th FYP is The fiscal deficit is estimated to be Nu. 29,243 estimated at Nu. 310,016 million, an increase million, which is 2.4 percent of GDP. The fiscal of 38 percent over 11th FYP. Of the total, current deficit shall be financed through external expenditure is estimated at Nu. 193,895 million borrowing mainly from ADB and the World Bank and capital expenditure at Nu. 116,121 million. on highly concessional terms. The estimated Current expenditure accounts for 62.5 percent net external borrowing during the 12th FYP is of total outlay. Nu. 4,074 million. In order to maintain flexibility in the use of the loan proceeds for priority The growth in current expenditure of 69 percent programmes and activities, preference will over the plan period is mainly on account of be to use increasing policy based borrowing increase in general provisions and interest instrument such as Development Policy Credit. payments for hydropower loans. Of the total The remaining deficit will be financed from current expenditure, 91 percent is for primary the domestic market through issuance of current expenditure and 9 percent is to meet government bond and treasury bills. However, to interest payment on outstanding debts. relieve pressure on the domestic credit market, efforts to access new external grant financing 54 percent of the total capital expenditure windows such as trust funds and green climate will be met through grants and 21 fund besides implementing public infrastructure percent through domestic revenue works under Public Private Partnership model surplus resulting in a gap of 25 percent. will continue. Figure 3.20: Expenditure projection in the 12th FYP 105 TWELFTH FIVE YEAR PLAN VOLUME - I Public Debt projected at Nu. 116 billion, of which about Nu. 1 billion is to be transferred to BESF. The total public debt by end of 12th FYP is Therefore, the allocation of capital outlay of projected to touch Nu. 249,232 million, which Nu.115 billion shall be on the following order is about 87.6 percent of estimated GDP. Of the of priority total debt, external debt is projected at Nu. 215,867 million which is about 75.9 percent ▀▀ Completion of 11th FYP spill over projects, of GDP. Hydropower debt will constitute about 68.4 percent of the total public debt ▀▀ Flagship Programmes, and 80 percent of external debt. With the ▀▀ Annual capital grants to local commissioning of Mangdechhu, Puna I, Puna governments, and II & Nikachhu Hydropower Projects in the 12th FYP the external debt stock is projected ▀▀ Programmes and projects that contribute to NKRAs/AKRAs. to decline. The external debt to GDP ratio is expected to improve from 103.4 percent in As illustrated below, the indicative capital FY 17/18 to 75.9 percent in FY 22/23. External outlay of Nu. 116 billion would be allocated debt service ratio is expected to remain as follows: below the threshold level of 22 percent. Non- hydro external debt by the end of the plan ▀▀ Nu. 15 billion for flagship is estimated at Nu. 45,333 million accounting Programmes, for 15.9 percent of estimated GDP. ▀▀ Nu. 50 billion for central agencies, ▀▀ Nu. 50 billion for LGs, and, 3.9 Resource Allocation Framework ▀▀ Nu. 1 billion for Bhutan Economic Stabilisation Fund. The indicative capital outlay in the 12th FYP is Figure 3.21: Resource Allocation Framework Total Capital Outlay Nu.116 billion Bhutan Economic Central Local Flagship Stabilisation Agencies Government Programmes Fund Nu.50 billion Nu.50 billion Nu.15 billion Nu.1 billion 1.Ministries 1.Dzongkhags 2.Constitutional bodies 2.Gewogs 3.Autonomous agencies 3.Thromde ‘A’s 106 3.9.1 Capital Outlay Allocation for the 12th FYP has increased by 100 percent to Central Agencies Nu. 50 billion from Nu. 25 billion in the 11th FYP to meet the increasing demand of public The capital outlay of Nu. 50 billion is allocated services from the LGs. to central ministries and autonomous agencies based on the 11th FYP allocation and Capital grants to LGs is allocated based DoRF between central agencies and LGs. For on Resource Allocation Formula (RAF) and some of the ministries/agencies, the 12th FYP Common Minimum Infrastructure (CMI) indicative outlay may be lower than the 11th needs. FYP outlay as activities which were budgeted Resource Allocation Formula with the central agencies in the 11th FYP has now been shifted to the LGs in the 12th The RAF is a formula for allocating capital FYP such as schools, hospitals, farm roads, resources among LGs (Dzongkhags, Gewogs, gewog connectivity roads, dzongkhag roads, and Thromde ‘A’s) based on a set of key and short-term capacity development. criteria that are representative of important developmental issues and needs of the LGs. Table 3.30: Indicative outlay for central The RAF ensures equitable distribution of agencies resources among LGs. Sl. No. Agencies Capital RAF was introduced in the 10th FYP and continued in the 11th FYP. The RAF for budget

1 Ministries 36,746.59 allocation to Dzongkhags and Gewogs was based on four criteria (i) population;

2 Constitutional Bodies 1,610.00 (ii) geographical area; (iii) poverty; and (iv) Autonomous transport cost index (from 11th FYP). Budget 3 9,375.00 Agencies allocation to four thromdes were need

4 Others 6,470.00 based. Total* 54,201.59* However, based on priority of the Government, the RAF for 12th FYP has been *Over budgeting of Nu 3,201.59 million against the revised. In addition, 12th FYP resources total outlay for central agencies of Nu 50,000 million. to Thromde ‘A’s is also being allocated ^Others include HRD, Special Priority Activities, CPE and SoE subsidy, and BESF of Nu 1000 million. using RAF. The revised formula takes into consideration specific needs/priorities of different levels of LGs – Gewog, Dzongkhag For capital outlay allocation by agencies, and Thromde as follows: refer Annexure-I. Gewog – the priority is given to agriculture 3.9.2 Capital Grants Allocation for and livestock (important means of livelihood), Local Governments access to health and education, water and hygiene and household income. Accordingly, The capital grants allocation for the LGs in allocation of funds to Gewogs are based on 107 TWELFTH FIVE YEAR PLAN VOLUME - I the criteria as outlined in Annexure-V. ▀▀ Nu. 20,019 million is allocated to 20 Dzongkhags. Of which, Nu. 17,000 Dzongkhag – focus is on developing million is allocated to 20 Dzongkhags local economy and job creation, quality of based on RAF and Nu. 3,019 million health and education, waste and culture. is allocated for CMI of Dzongkhags Accordingly, the criteria used are as outlined including Dzongkhag Throms and in Annexure-VI. Yenlag Throms. ▀▀ Nu. 19, 855 million is allocated for Thromde ‘A’s- focus on urban facilities, 205 Gewogs. Of which, Nu. 12,000 safety, water, sanitation, pollution, quality million is allocated by RAF to Gewogs of education and congestion. Accordingly, and Nu. 7,855 million is allocated for criteria used are as outlined in Annexure-VII. Gewog CMI. ▀▀ Nu. 10,126 million is allocated to four Common Minimum Infrastructure and Thromde ‘A’s. Of which, Nu. 10,000 Outlay million is allocated by RAF to four Thromde ‘A’s and Nu. 126 million is The concept of CMI is used to reduce allocated for Thromde ‘A’s CMI. disparities in distribution of common public infrastructure and facilities among For capital outlay by Dzongkhags, thromde, Dzongkhags, Gewogs, and Thromde ‘A’s. and gewogs, refer Annexure-III. The required CMI with indicative costing have been determined in close consultation with LGs and Central agencies. For the list of CMIs and outlay for Dzongkhags, Dzongkhag throms, Yenlag throms, Gewogs, and Thromde ‘A’s, refer Annexure-VIII. The Capital grants of Nu. 50,000 million is allocated to Dzongkhags, Gewogs and Thromde ‘A’s as follows: Table 3.31: Capital grants allocation to LGs Resources Resources to be to be allocated Total LGs allocated based on (Nu. in M) for CMI RAF (Nu. in M) (Nu. in M) Dzongkhags 17,000 3,019 20,019 Gewogs 12,000 7,855 19,855 Thromde ‘A’s 10,000 126 10,126 Total 39,000 11,000 50,000 108 Table 3.32: Capital grants allocation by criteria for LGs Dzongkhag ( Gewog (Nu. Thromde 'A's Total (Nu. No. RAF Critetria CMI Nu. in M) in M) (Nu. in M) in M)

1 Economy 6,800 6,800

2 GNH index 2,550 1,200 1,000 4,750

3 Health 1,700 2,400 3,000 477.14 7,577

4 Education 1,700 600 1,500 200 4,000

5 Culture 1,700 500 2,200

6 Environment 2,550 1,500 126 4,176 Resident 7 1,800 1,500 454.55 3,755 population

8 Farming 1,800 5,050 6,850

9 Poverty 1,800 1,800 Transportation 10 2,400 2,589.16 4,989 Cost

11 Safety 1,000 2,103.15 3,103 Total 17,000 12,000 10,000 11,000 50,000 3.10 Capital outlay by sector The share of the total capital outlay of Nu. 115 billion for sectors (central agencies and local governments) is presented below. For details, refer Annexure –IV. Figure 3.22: Sectoral capital allocation (central, flagships and LGs) Notes: *Others include HRD, Special priority activities, CPE and SoE subsidy, Stabilisation fund, and LGs RAF allocation for population and income sub criteria (poverty). 109 TWELFTH FIVE YEAR PLAN VOLUME - I Figure 3.23: Central agencies’ capital outlay by sector^ Notes: ^Includes flagship outlay of Nu.15 billion. *Others include HRD, Special Priority Activities, CPE and SoE subsidy, Stabilisation fund. Figure 3.24: Local Governments’ capital outlay by sector^ Notes: ^Capital outlay based on RAF sub-criteria, and does not include flagship program outlay. *Forests functions not with LGs. ** Others include RAF allocations for GNH Index and population. 110 3.11 Plan Implementation, Government Performance Management Monitoring and Evaluation System (GPMS). Annual Budget proposals shall be made to achieve the annual 3.11.1 Plan Implementation performance targets. Upon approval of annual budget by the Parliament, annual The 12th FYP period is from 1st November, performance targets shall be aligned to 2018 to 31st October, 2023. All Plans and the approved budget and finalised for Programmes will be implemented through implementation. different budgetary agencies (central agencies and local government). In addition, 3.11.4 Monitoring and Evaluation other agencies including state owned enterprises, corporations, private sector The monitoring and evaluation of the 12th and CSOs are expected to collaborate and FYP shall be as per the National Monitoring contribute in the implementation of the and Evaluation System framework. The plan based on their competitive advantages. GNH Commission through the GNHC To ensure effective and efficient delivery Secretariat shall carry out overall monitoring of results, Coordination, Consolidation and evaluation of 12th FYP as well as make and Collaboration (Triple C) shall be the strategic and timely intervention to provide fundamental principle underpinning guidance and direction to the sectors. On an implementation of the Plan at all levels. annual basis, the Government Performance Management Division (GPMD) under the 3.11.2 The Division of Office of the Prime Minister, shall monitor the implementation of the plan through the Responsibilities Framework annual performance agreement. In order to ensure better coordination of The monitoring of the 12th FYP implementation efforts between Central Agencies and LGs, will be carried out as follows: the Division of Responsibilities Framework will guide annual implementation of 12th FYP ▀▀ Routine annual performance programmes, projects and activities. The monitoring by GPMD and GNHC assigned responsibilities and investment through GPMS. menu in the framework will be monitored for compliance in the 12th FYP. Infrastructure ▀▀ Monitoring of NKRAs, AKRAs, LGKRAs development spilling over to the 12th FYP, will and KPIs by GNHC. continue as per the 11th FYP project modality ▀▀ Mid-year review of annual till completion. performance targets led by GPMD. 3.11.3 Annual Performance ▀▀ Annual performance evaluation led by GPMD. Planning and Budgeting ▀▀ Mid-term review of Plan by GNHC. AKRAs, LGKRAs, KPIs, central programmes, The lead agency for each NKRA is responsible LG programmes and flagship programmes to monitor and report progress of the will be translated into annual performance NKRA, KPIs and the corresponding AKRAs targets as per requirements of the 111 TWELFTH FIVE YEAR PLAN VOLUME - I and AKRA KPIs. The LGs are responsible to 3.11.5 Round Table Meeting monitor and report progress of the LGKRAs and corresponding KPIs. The Round Table Meeting (RTM) is an important forum for interaction with the Policy and Planning Divisions or equivalent development partners on socio-economic divisions/units within respective agencies development priorities and progress. During are responsible for monitoring sector the Plan period, two RTMs will be held, one programmes including liaising with the towards the beginning of the 12th FYP and LGs and other central agencies and another towards the middle of the Plan. provide periodic status update on the plan Besides the RTM, bilateral consultations, implementation and KPIs to the GNHC. programme and project specific reviews, and monitoring and evaluation meetings LGs are responsible to undertake overall will be held between the Royal Government monitoring of activities within respective and development partners as per mutually Dzongkhags/Thromdes/Gewogs and report agreed timings. to GNHC. The 14th RTM for the 12th FYP was held from The 12th FYP shall actively promote social 13th to 14th March, 2019 themed “enhancing accountability and therefore encourage happiness and sustainable development citizen participation in monitoring through partnerships,” focusing on development plans happening within their strengthening and broadening partnerships community to ensure greater accountability for development. More than 50 development and results of development programmes. partners, bilateral and multilateral, attended the RTM. GNHC shall evaluate the achievement of the 12th FYP NKRAs and KPIs including flagship programmes at the end of plan. Agencies, LGs and GNHC may evaluate specific programmes and projects guided by the National Evaluation Policy. 112 ANNEXURES 113 TWELFTH FIVE YEAR PLAN VOLUME - I 114 ANNEXURE I: Capital Outlay for Central Agencies (Nu. in million) Sl. No. Agencies Indicative Outlay Capital Current Total MINISTRIES

1 Ministry of Agriculture and Forest 3,050.35 10,896.82 13,947.17

2 Ministry of Economic Affairs 3,400.00 1,383.03 4,783.03

3 Ministry of Education 4,000.00 2,863.42 6,863.42

4 Ministry of Foreign Affairs 750.00 3,773.19 4,523.19

5 Ministry of Finance 700.00 22,038.88 22,738.88

6 Ministry of Health 3,580.00 5,785.78 9,365.78

7 Ministry of Home and Cultural Affairs 3,240.00 10,194.27 13,434.27

8 Ministry of Information and Communications 3,490.00 1,795.58 5,285.58

9 Ministry of Labor and Human Resources 2,800.00 1,352.34 4,152.34

10 Ministry of Works and Human Settlement 11,736.24 3,654.41 15,390.65 Sub-total 36,746.59 63,737.70 100,484.29 CONSTITUTIONAL BODIES

1 Election Commission of Bhutan 250.00 708.77 958.77

2 Royal Civil Service Commission 200.00 365.17 565.17

3 Anti-Corruption Commission 210.00 446.39 656.39

4 Royal Audit Authority 200.00 993.40 1,193.40

5 Royal Court of Justice 750.00 1,543.13 2,293.13 Sub-total 1,610.00 4,056.86 5,666.86 AUTONOMOUS AGENCIES

1 Bhutan National Legal Institute 50.00 79.74 129.74

2 Jigme Singye Wangchuck School of Law 1,000.00 265.20 1,265.20 115 TWELFTH FIVE YEAR PLAN VOLUME - I Sl. No. Agencies Indicative Outlay Capital Current Total

3 Royal University of Bhutan 1,200.00 3,766.82 4,966.82

4 Royal Institute of Management 200.00 251.53 451.53

5 National Environment Commission Secretariat 450.00 179.21 629.21

6 National Statistics Bureau 300.00 187.63 487.63

7 Bhutan Olympic Committee 405.00 524.58 929.58

8 National Assembly Secretariat 50.00 630.55 680.55

9 National Council Secretariat 50.00 425.84 475.84

10 Cabinet Secretariat 50.00 211.62 261.62

11 Dzongkhag Development Commission 75.00 103.56 178.56

12 Bhutan Narcotic Control Authority 50.00 144.42 194.42

13 Drug Regulatory Authority 50.00 94.72 144.72

14 Office of Attorney General 50.00 181.61 231.61

15 National Commission for Women and Children 70.00 85.14 155.14

16 Bhutan Standards Bureau 50.00 134.89 184.89

17 Bhutan InfoComm and Media Authority 75.00 89.85 164.85

18 Dratshang Lhentshog 750.00 3,423.03 4,173.03 Bhutan Council for School Examinations and 19 Assessment 160.00 656.00 816.00

20 Royal Education Council 300.00 180.03 480.03

21 National Land Commission Secretariat 300.00 861.44 1,161.44 Gross National Happiness Commission 22 Secretariat 100.00 202.36 302.36 Khesar Gyalpo University of Medical Science 23 of Bhutan 445.00 593.59 1,038.59

24 JDWNR Hospital 900.00 5,601.78 6,501.78 National Centre for Hydrology and 25 Meteorology 300.00 473.77 773.77 116 Sl. No. Agencies Indicative Outlay Capital Current Total

26 Construction Development Board 55.00 78.11 133.11

27 Bhutan Medical Health Council 15.00 48.79 63.79

28 Royal Bhutan Police* - 1,500.00 1,500.00

29 Centre for Bhutan Studies and GNH Research 200.00 193.39 393.39

30 Agency for Promotion of Indigenous Crafts** - 170.00 170.00

31 Civil Society Organisation Authority 5.00 17.19 22.19

32 Tourism Council of Bhutan*** - 348.43 348.43 Sub-total 9,375.00 20,034.83 29,409.83 OTHERS

1 Human Resource Development - 1,200.00 1,200.00

2 Common Public Expenditure 2,000.00 4,364.58 6,364.58

3 Provision for Office Constructions - 2,270.00 2,270.00

4 Royal Privy Council - 88.95 88.95

5 General Provisions - 24,066.59 24,066.59

6 Subsidies, Transfers and Equities - 13,709.61 13,709.61

7 Debt Servicing - 13,645.56 13,645.56

8 Bhutan Health Trust Fund - 35.39 35.39

9 Bhutan Economic Stabilisation Fund 1000 - 1000.00 Sub-total 6,470.00 55,910.67 62,380.67 ****Grand total 54,201.59 143,740.07 197,941.66 *RBP current budget included under MoHCA. **APIC current budget included under DCSI, MoEA. *** TCB capital budget included under Tourism flagship. ****Excluding flagship programme outlay. Over capital budgeting of Nu 3,201.59 million for central agencies. 117 TWELFTH FIVE YEAR PLAN VOLUME - I ANNEXURE II: Flagship Programme Outlay (Nu in million) Sl. No Flagship Programme Lead Agency Capital Outlay

1 Water NEC 2,743.00

2 Digital Drukyul MoIC 2,557.00

3 Startup & CSI MoEA 1,200.00

4 Tourism TCB 1,500.00

5 Organic MoAF 1,000.00

6 Health MoH 1,000.00

7 Rural Economy - 2,000.00

8 Education MoE 1,000.00

9 Waste PMO 1,000.00

10 Provisions for other flagships - 1,000.00 Total 15,000.00 118 ANNEXURE III: Capital grants allocation by criteria for LGs (a) Capital Grants Allocation to Dzongkhags (Nu. in Million) Sl. No Dzongkhag RAF CMI Total Outlay Capital (RAF+CMI) Current Total

1 Bumthang 574.98 161.40 736.38 1,515.19 2,251.57

2 Chhukha 1,042.88 0.00 1,042.88 3,195.36 4,238.24

3 Dagana 912.59 267.26 1,179.85 2,213.45 3,393.30

4 Gasa 544.97 120.40 665.37 670.20 1,335.56

5 Haa 599.43 115.40 714.83 1,188.25 1,903.08

6 Lhuentse 701.16 221.26 922.42 1,533.45 2,455.87

7 Mongar 906.32 105.40 1,011.72 3,068.12 4,079.83

8 Paro 914.00 161.40 1,075.40 2,800.04 3,875.44

9 Pema Gatshel 717.22 267.26 984.47 2,305.41 3,289.88

10 Punakha 870.63 115.40 986.03 2,464.85 3,450.87

11 Samdrup Jongkhar 795.18 0.00 795.18 2,351.40 3,146.58

12 Samtse 1,233.45 115.40 1,348.85 3,831.28 5,180.13

13 Sarpang 951.53 0.00 951.53 2,424.76 3,376.29

14 Trashi Yangtse 625.07 115.40 740.47 1,858.66 2,599.13

15 Trashigang 1,017.03 105.40 1,122.43 4,309.91 5,432.33

16 Thimphu 1,139.44 0.00 1,139.44 1,596.50 2,735.94 119 TWELFTH FIVE YEAR PLAN VOLUME - I Sl. No Dzongkhag RAF CMI Total Outlay Capital (RAF+CMI) Current Total

17 Trongsa 879.75 115.40 995.15 1,515.25 2,510.40

18 Tsirang 786.11 115.40 901.51 2,113.37 3,014.88

19 Wangdue Phodrang 1,040.96 216.26 1,257.21 2,636.81 3,894.02

20 Zhemgang 747.33 262.26 1,009.59 2,115.97 3,125.56 Others 438.30 438.30 438.30 Total 17,000.00 3,019.00 20,019.01 45,708.23 65,727.24 (b) Capital Grants Allocation to Thromde 'A's (Nu. in Million) Sl. No Thromde RAF CMI Capital (RAF+CMI) Current Total

1 Thimphu 4,636.45 30 4,666.45 2,919.63 7,586.08

2 Phuentsholing 2,338.40 32 2,370.40 623.02 2,993.42 Samdrup 3 1,543.91 32 1,575.91 438.43 2,014.34 Jongkhar

4 Gelephu 1,481.24 32 1,513.24 570.62 2,083.86 Total 10,000.00 126 10,126.00 4,551.70 14,677.70 120 (c) Capital Grants Allocation to Gewogs (Nu. in Million) Sl.No Dzongkhag Gewog RAF CMI Total

1 Bumthang Chhoekhor 87.367 19.800 107.167

2 Bumthang Chhumig 52.799 19.800 72.599

3 Bumthang Tang 49.646 19.800 69.446

4 Bumthang Ura 37.436 19.800 57.236

5 Chhukha Bjagchhog 53.624 19.800 73.424

6 Chhukha Bongo 99.806 61.800 161.606

7 Chhukha Chapchha 47.394 19.800 67.194

8 Chhukha Darla 162.578 19.800 182.378

9 Chhukha Doongna 42.861 19.800 62.661

10 Chhukha Geling 49.787 39.810 89.597

11 Chhukha Getana 41.834 398.146 439.980

12 Chhukha Loggchina 66.428 124.200 190.628

13 Chhukha Maedtabkha 26.364 19.800 46.164

14 Chhukha Phuentshogling 119.218 19.800 139.018

15 Chhukha Samphelling 86.950 19.800 106.750

16 Dagana Dorona 40.760 82.800 123.560

17 Dagana Drukjeygang 74.255 19.800 94.055

18 Dagana Gesarling 36.306 19.800 56.106

19 Dagana Gozhi 53.833 19.800 73.633

20 Dagana Karmaling 36.514 40.800 77.314

21 Dagana Karna 69.114 19.800 88.914

22 Dagana Khebisa 66.656 74.320 140.976

23 Dagana Largyab 32.432 82.005 114.437

24 Dagana Lhamoi Dzingkha 56.692 19.800 76.492

25 Dagana Nichula 41.214 40.800 82.014

26 Dagana Tashiding 59.639 40.800 100.439

27 Dagana Tsangkha 45.350 19.800 65.150

28 Dagana Tsenda-Gang 54.168 40.800 94.968

29 Dagana Tseza 39.127 21.000 60.127 121 TWELFTH FIVE YEAR PLAN VOLUME - I Sl.No Dzongkhag Gewog RAF CMI Total

30 Gasa Khamaed 21.024 19.800 40.824

31 Gasa Khatoed 17.544 19.800 37.344

32 Gasa Laya 68.443 92.300 160.743

33 Gasa Lunana 56.962 21.000 77.962

34 Haa Bji 42.978 19.800 62.778

35 Haa Gakiling 52.147 61.800 113.947

36 Haa Kar-tshog 36.276 19.800 56.076

37 Haa Samar 34.434 19.800 54.234

38 Haa Sangbay 53.335 40.800 94.135

39 Haa Uesu 32.119 19.800 51.919

40 Lhuentse Gangzur 74.707 19.800 94.507

41 Lhuentse Jarey 43.150 19.800 62.950

42 Lhuentse Khoma 62.382 19.800 82.182

43 Lhuentse Kurtoed 31.853 19.800 51.653

44 Lhuentse Maedtsho 39.909 19.800 59.709

45 Lhuentse Maenbi 60.361 21.000 81.361

46 Lhuentse Minjey 43.656 19.800 63.456

47 Lhuentse Tsaenkhar 71.932 19.800 91.732

48 Mongar Balam 32.873 19.800 52.673

49 Mongar Chagsakhar 48.578 19.800 68.378

50 Mongar Chhaling 60.380 19.800 80.180

51 Mongar Dramedtse 67.365 19.800 87.165

52 Mongar Drepoong 45.449 19.800 65.249

53 Mongar Gongdue 58.573 108.660 167.233

54 Mongar Jurmed 59.742 19.800 79.542

55 Mongar Kengkhar 61.295 19.800 81.095

56 Mongar Monggar 94.250 19.800 114.050

57 Mongar Narang 49.312 73.450 122.762

58 Mongar Ngatshang 46.623 19.800 66.423

59 Mongar Saling 59.974 19.800 79.774 122 Sl.No Dzongkhag Gewog RAF CMI Total

60 Mongar Shermuhoong 67.376 19.800 87.176

61 Mongar Silambi 53.783 208.300 262.083

62 Mongar Thang-rong 56.046 19.800 75.846

63 Mongar Tsakaling 59.798 19.800 79.598

64 Mongar Tsamang 44.812 19.800 64.612

65 Paro Dokar 50.417 19.800 70.217

66 Paro Dopshar-ri 48.462 19.800 68.262

67 Paro Doteng 28.132 19.800 47.932

68 Paro Hoongrel 11.918 19.800 31.718

69 Paro Lamgong 69.057 19.800 88.857

70 Paro Loong-nyi 50.620 19.800 70.420

71 Paro Nagya 76.475 19.800 96.275

72 Paro Sharpa 77.342 19.800 97.142

73 Paro Tsento 74.857 19.800 94.657

74 Paro Wangchang 67.317 19.800 87.117

75 Pema Gatshel Chhimoong 38.994 158.420 197.414

76 Pema Gatshel Chhoekhorling 33.635 70.670 104.305

77 Pema Gatshel Chongshing 43.358 19.800 63.158 b) Gewogs CMI and Outlay

78 Pema Gatshel Dechhenling 80.603 19.800 100.403

79 Pema Gatshel Dungmaed 46.918 40.800 87.718

80 Pema Gatshel Khar 46.924 19.800 66.724

81 Pema Gatshel Nanong 60.852 19.800 80.652

82 Pema Gatshel Norboogang 64.147 19.800 83.947

83 Pema Gatshel Shumar 67.569 21.000 88.569

84 Pema Gatshel Yurung 41.436 121.300 162.736

85 Pema Gatshel Zobel 51.331 19.800 71.131

86 Punakha Barp 67.086 19.800 86.886

87 Punakha Chhubu 53.432 40.800 94.232

88 Punakha Dzomi 44.552 19.800 64.352

89 Punakha Goenshari 35.998 19.800 55.798 123 TWELFTH FIVE YEAR PLAN VOLUME - I Sl.No Dzongkhag Gewog RAF CMI Total

90 Punakha Guma 70.078 21.000 91.078

91 Punakha Kabisa 50.571 19.800 70.371

92 Punakha Lingmukha 29.343 19.800 49.143

93 Punakha Shelnga-Bjemi 40.641 19.800 60.441

94 Punakha Talog 39.295 19.800 59.095

95 Punakha Toedpaisa 50.821 19.800 70.621

96 Punakha Toedwang 36.819 19.800 56.619

97 Samdrup Jongkhar Dewathang 55.229 19.800 75.029

98 Samdrup Jongkhar Gomdar 88.027 19.800 107.827

99 Samdrup Jongkhar Langchenphu 34.528 19.800 54.328

100 Samdrup Jongkhar Lauri 110.134 188.070 298.204

101 Samdrup Jongkhar Martshala 72.658 61.800 134.458

102 Samdrup Jongkhar Orong 67.598 40.800 108.398

103 Samdrup Jongkhar Pemathang 42.155 19.800 61.955

104 Samdrup Jongkhar Phuentshogthang 72.484 19.800 92.284

105 Samdrup Jongkhar Samrang 19.059 19.800 38.859

106 Samdrup Jongkhar Serthig 62.582 19.800 82.382

107 Samdrup Jongkhar Wangphu 72.975 40.800 113.775

108 Samtse Denchukha 79.287 179.300 258.587

109 Samtse Dophuchen 117.777 19.800 137.577

110 Samtse Dungtoed 48.118 165.380 213.498

111 Samtse Namgyalchhoeling 94.473 19.800 114.273

112 Samtse Norbugang 79.687 19.800 99.487

113 Samtse Norgaygang 131.631 40.800 172.431

114 Samtse Pemaling 83.294 19.800 103.094

115 Samtse Phuntshopelri 112.821 106.800 219.621

116 Samtse Samtse 97.939 21.000 118.939

117 Samtse Sangacholing 81.708 19.800 101.508

118 Samtse Tading 139.644 19.800 159.444

119 Samtse Tashichoeling 75.482 19.800 95.282 124 Sl.No Dzongkhag Gewog RAF CMI Total

120 Samtse Tendruk 117.468 19.800 137.268

121 Samtse Ugyentse 36.969 19.800 56.769

122 Samtse Yoeseltse 81.127 19.800 100.927

123 Sarpang Chudzom 81.997 296.000 377.997

124 Sarpang Chuzanggang 60.043 19.800 79.843

125 Sarpang Dekiling 93.504 19.800 113.304

126 Sarpang Gakiling 77.538 40.800 118.338

127 Sarpang Gelegphu 73.768 19.800 93.568

128 Sarpang Jigme Chhoeling 100.956 40.800 141.756

129 Sarpang Samtenling 54.597 19.800 74.397

130 Sarpang Senggey 43.874 40.800 84.674

131 Sarpang Serzhong 40.926 19.800 60.726

132 Sarpang Shompangkha 29.623 19.800 49.423

133 Sarpang Tareythang 18.173 19.800 37.973

134 Sarpang Umling 39.058 19.800 58.858

135 Thimphu Chang 69.912 19.800 89.712

136 Thimphu Darkarla 36.276 19.800 56.076

137 Thimphu Ge-nyen 24.982 19.800 44.782

138 Thimphu Kawang 80.579 19.800 100.379

139 Thimphu Lingzhi 26.543 22.200 48.743

140 Thimphu Maedwang 80.034 19.800 99.834

141 Thimphu Naro 18.270 88.530 106.800

142 Thimphu Soe 16.567 22.200 38.767

143 Trashi Yangtse Bumdeling 85.546 19.800 105.346

144 Trashi Yangtse Jamkhar 35.990 19.800 55.790

145 Trashi Yangtse Khamdang 91.250 19.800 111.050

146 Trashi Yangtse Ramjar 47.282 19.800 67.082

147 Trashi Yangtse Toedtsho 63.419 19.800 83.219

148 Trashi Yangtse Tongmajangsa 47.792 19.800 67.592

149 Trashi Yangtse Yalang 66.069 19.800 85.869 125 TWELFTH FIVE YEAR PLAN VOLUME - I Sl.No Dzongkhag Gewog RAF CMI Total

150 Trashi Yangtse Yangtse 68.082 21.000 89.082

151 Trashigang Bartsham 49.308 19.800 69.108

152 Trashigang Bidung 41.186 19.800 60.986

153 Trashigang Kanglung 88.858 19.800 108.658

154 Trashigang Kangpar 67.893 19.800 87.693

155 Trashigang Khaling 65.508 19.800 85.308

156 Trashigang Lumang 97.278 19.800 117.078

157 Trashigang Merag 66.064 168.900 234.964

158 Trashigang Phongmed 67.671 19.800 87.471

159 Trashigang Radhi 67.153 19.800 86.953

160 Trashigang Sagteng 116.097 129.170 245.267

161 Trashigang Samkhar 68.885 19.800 88.685

162 Trashigang Shongphu 61.634 19.800 81.434

163 Trashigang Thrimshing 53.365 19.800 73.165

164 Trashigang Udzorong 69.485 19.800 89.285

165 Trashigang Yangnyer 65.182 19.800 84.982

166 Trongsa Draagteng 76.941 19.800 96.741

167 Trongsa Korphu 35.850 19.800 55.650

168 Trongsa Langthil 81.486 19.800 101.286

169 Trongsa Nubi 79.635 21.000 100.635

170 Trongsa Tangsibji 43.714 19.800 63.514

171 Tsirang Barshong 43.566 61.800 105.366

172 Tsirang Dunglagang 49.059 19.800 68.859

173 Tsirang Gosarling 45.793 19.800 65.593

174 Tsirang Kilkhorthang 57.603 42.000 99.603

175 Tsirang Mendrelgang 43.408 51.700 95.108

176 Tsirang Patshaling 39.492 19.800 59.292

177 Tsirang Pungtenchhu 45.543 19.800 65.343

178 Tsirang Rangthangling 51.218 40.800 92.018

179 Tsirang Semjong 38.967 19.800 58.767 126 Sl.No Dzongkhag Gewog RAF CMI Total

180 Tsirang Sergithang 48.336 19.800 68.136

181 Tsirang Tsholingkhar 53.588 19.800 73.388

182 Tsirang Tsirang Toed 48.700 61.800 110.500

183 Wangdue Phodrang Athang 45.243 40.800 86.043

184 Wangdue Phodrang Bjenag 50.719 19.800 70.519

185 Wangdue Phodrang Dangchhu 39.593 19.800 59.393

186 Wangdue Phodrang Darkar 61.108 19.800 80.908

187 Wangdue Phodrang Gangteng 47.722 19.800 67.522

188 Wangdue Phodrang Gase Tshogongm 59.206 19.800 79.006

189 Wangdue Phodrang Gase Tshowogm 21.596 19.800 41.396

190 Wangdue Phodrang Kazhi 48.407 19.800 68.207

191 Wangdue Phodrang Nahi 29.527 19.800 49.327

192 Wangdue Phodrang Nyishog 50.257 19.800 70.057

193 Wangdue Phodrang Phangyuel 31.007 19.800 50.807

194 Wangdue Phodrang Phobji 47.326 21.000 68.326

195 Wangdue Phodrang Ruebisa 46.808 19.800 66.608

196 Wangdue Phodrang Saephu 43.747 19.800 63.547

197 Wangdue Phodrang Thedtsho 85.195 19.800 104.995

198 Zhemgang Bardo 82.830 229.830 312.660

199 Zhemgang Bjoka 52.982 156.170 209.152

200 Zhemgang Goshing 63.460 19.800 83.260

201 Zhemgang Nangkor 73.393 40.800 114.193

202 Zhemgang Ngangla 68.077 19.800 87.877

203 Zhemgang Phangkhar 54.615 42.000 96.615

204 Zhemgang Shingkhar 64.299 74.324 138.623

205 Zhemgang Trong 68.323 19.800 88.123 Others - - 216.45 216.45 Total 12,000.000 7,855.005 19,885.008 127 TWELFTH FIVE YEAR PLAN VOLUME - I ANNEXURE IV: Capital outlay by sector (Nu. in million] Sl.No Sub-Sector Central LG Flagship Total Remarks Central outlay: MoAF Local Government Allocation: Agriculture RAF allocation for farming sub 1 3,050.35 9,500 1,000.00 13,550.35 and Forest criteria for Dzongkhag and Farm Roads maintenance. Flagships Organic Bhutan Central outlay: MoHCA , Dratshang Lhentshog, DDC

2 Culture 4,065.00 2,200 - 6,265.00 Local Government Allocation: RAF allocation for GNH Index and Culture Central outlay: MoE, RUB, RIM, BCSEA, REC, UMBS, MoLHR (Programme 1)

3 Education 8,409.00 4,000.00 1,000.00 13,409.00 Local Government Allocation: RAF allocation for education sub criteria Flagship: Education Central outlay: NEC, NLCS Local Government Allocation:

4 Environment 1,050.00 3,326.00 1,000.00 5,376.00 RAF allocation for air pollution, waste disposal and litter Flagship: Waste Central outlay: MFA, BNLI, JSWL,RCoJ,MoF, ECB,RCSC, ACC, RAA, NSB,

5 Governance 8,865.00 - - 8,865.00 CBS, NA, NC,Cabinet, CSO, OAG, BSB, BICMA, GNHC, CDB, RBP, office construction Central outlay: MoH, BNCA, DRA, JDWNRH, BMHC Local Government Allocation:

6 Health 5,070.00 7,577.14 1,000.00 13,647.14 RAF allocation for U5 Mortality, water supply, sanitation and Crude Death Rate Flagship: Health 128 Sl.No Sub-Sector Central LG Flagship Total Remarks Central outlay: MoWHS Human Local Government Allocation: 7 1,005.10 8,092.31 2,743.00 11,840.41 Settlement RAF allocation for transportation and safety Flagship: Water Central outlay: MoEA, MoLHR (Programme 2). Local Government Allocation: RAF allocation for CSI sub- criteria

8 Industries 4,266.00 6,800.00 4,700.00 15,766.00 Flagships: Tourism Development -1.5b, CSIs & Startups- 1.2b, Rural Economy -2b. Central outlay: MOIC

9 Infocom 2,531.00 - 2,557.00 5,088.00 Flagship: Digital Drukyul

10 Roads 11,690.14 - - 11,690.14 MoWHS ( Roads), MoIC (RSTA) Central outlay: HRD, Special Priority Activities, CPE and SoE subsidy, Stabilisation fund, Provision

11 Others 4,200.00 8,504.55 1,000.00 13,704.55 for other other flagships. Local Government Allocation: RAF allocation for population and GNH Index Over budgeting of Nu Total 54,201.59 50,000.00 15,000.00 119,201.59 3,471.59 million for Central Agencies 129 TWELFTH FIVE YEAR PLAN VOLUME - I ANNEXURE V: Resource Allocation Formula for Gewog Criteria & Sub-Criteria & SL. No. Description Rationale Weight Weight Higher the resident Resident Number of resident population of

1 Population (15%) population, higher the share Population (15%) the Gewog (PHCB, 2017). of resources. Level of happiness & general Lower the level of GNH index (10%) well-being of the population

2 GNH Index (10%) happiness, higher the share Inverse in the Gewog. (GNH Survey of resources. Report, 2015). Area of Kamzhing (dry land) in Kamzhing (5%) acres owned by people in the Gewog (PHCB 2017). To promote farming and enhance production, Area of Chhuzhing (wetland) in higher share of resource

3 Farming (15%) Chuzhing (5%) acres owned by people in the will be allocated for higher Gewog (PHCB 2017). area under cultivation and livestock rearing. Number of livestock (Nor) owned Livestock (5%) by people in the Gewog. (PHCB 2017). Rate of U5 deaths in percentage in the last 12 months to total births U5MR (5%) in the last 12 months in the Gewog (PHCB 2017). Number of households without access to reliable water To improve general health (unavailability of water at least of people, more resources Unreliable water during the critical time 5AM-8AM, is allocated to higher

4 Health (20%) supply (10%) 11AM-2PM and 5PM-9PM & not incidence of U5 mortality, adequate for washing/cooking) in unreliable water supply and the Gewog (PHCB 2017). poor sanitation. Number of households without access to improved sanitation Unhygienic facilities (households without pour sanitation (5%) flush, ventilated improved pit, pit latrine with slab & composting toilet) in the Gewog (PHCB 2017). To reduce out of school children and ensure School aged completion of primary Number of school-age children children education, higher share of

5 Education (5%) (6-14) out of school in the Gewog unschooled (6- resources is allocated to (PHCB 2017). 14 years) (5%) higher number of out of school children (aged 6-14 years). 130 Criteria & Sub-Criteria & SL. No. Description Rationale Weight Weight To uplift people from Number of people below poverty poverty and increase Income Poverty line (< Nu 2195.95 per person per income, more resource (5%) month) in the Gewog (BLSS 2012). share is allocated to higher incidence of income poverty.

6 Poverty (15%) To improve household Average HHs Mean per-capita household income, more resource Income (10%) income (in Nu.) in the Gewog (BLSS, share is allocated to Inverse 2012). incidence of lower household income. Number of households within To cover additional Distance to road walking distance of more than 30 transportation cost , higher head (15%) minutes from the nearest road resource is allocated to head in the Gewog (PHCB 2017). gewogs with higher number of households residing Transportation/ 7 within walking distance of Distance (20%) more than 30 minutes from Per unit cost per metric ton per the nearest road head and Transportation kilometre (distance) of Dzongkhag Dzongkhag headquarters cost (5%) headquarter from Phuentsholing which are further away from (Administrative Data, RSTA). Phuentsholing. 131 TWELFTH FIVE YEAR PLAN VOLUME - I ANNEXURE VI: Resource Allocation Formula for Dzongkhag Criteria & Sub-Criteria & Sl. No. Description Rationale Weight Weight Number of production & CSI (20%) manufacturing Cottage & Small Inverse Industries (CSI) to resident population in the Dzongkhag (CSI Report, 2018). To enhance local economy and Number of people unemployed job creation, more resources is (persons above 15 years & above Economy People allocated to Dzongkhags with 1 who during the reference period (40%) unemployed lesser CSIs, more unemployed are without work, currently available (10%) people and more people for work & seeking work) in the employed in agriculture. Dzongkhag (PHCB, 2017.) Employed in Number of people (aged 15-64 agriculture years)employed in agriculture in the (10%) Dzongkhag (PHCB, 2017). Level of happiness & general well- GNH index GNH Index being of the population in the Lower the level of happiness,

2 (15%) (15%) Dzongkhag (GNH Survey Report, higher the share of resources. Inverse 2015). To improve health status and Number of deaths in a year per 1000 Crude Death life expectancy, more resource

3 Health (10%) population the Dzongkhag (PHCB Rate (10%) is allocated to higher incidences 2017). of death. Pass percentage (40%) of students To improve quality of education, Students’ Education in class X in BCSE in the Dzongkhag higher resource is allocated 4 performance (10%) (Pupil Performance Report, 2018, to Dzongkhags with lower (10%) Inverse BCSEA). students’ performance in BCSE. To preserve and promote Cultural Average number of days of culture particularly intangible, participation participation by people in socio-

5 Culture (10%) higher resource is allocated to (10%) cultural activities in the Dzongkhag lower level of participation in Inverse (GNH Survey Report, 2015). socio-cultural events. Number of people affected by To address environmental Waste disposal inadequate waste disposal sites & issues and mitigate loss of and litter (10%) littering in the Dzongkhag (PHCB, crops and livestock to wildlife, 2017). higher resource is allocated to Environment

6 Dzongkhags with more number (15%) of people without waste Wildlife Number of people affected by wildlife disposal facilities and affected damages (5%) in the Dzongkhag (PHCB, 2017). by wildlife. 132 ANNEXURE VII: Resource Allocation Formula for Thromde ‘A’s Criteria & Sub-Criteria & Sl. No. Description Rationale Weight Weight Resident Population Number of resident population of the (10%) Thromde (PHCB, 2017) More resource is allocated to Thromde

1 Population (15%) ‘A’s with higher number of resident Number of resident population per Population density population and lower population density. area (sq.km) of Thromde (PHCB, 2017 (5%) Inverse & Thromde Administrations) Level of happiness & general well- GNH Index (10%) Lower the level of happiness and well-

2 GNH Index (10%) being of the population in the Inverse being, higher the share of resources. Thromde (GNH Survey Report, 2015) Number of people discontented with Air pollution (5%) air pollution in the Thromde (PHCB, 2017) To address environmental issues, higher resource is allocated to Thromde ‘A’s with

3 Environment (15%) more number of people without waste Number of people affected by disposal facilities and discontented with Waste disposal and inadequate waste disposal sites & air quality. litter (10%) littering in the Thromde (PHCB, 2017) Number of households without access to reliable water (unavailability Unreliable water of water at least during the critical supply (20%) time 5AM-8AM, 11AM-2PM and 5PM- 9PM & not adequate for washing/ To improve general health of the cooking) in the Thromde (PHCB 2017) people, more resources is allocated to

4 Health (30%) Thromde ‘A’s with higher households with unreliable water supply and poor Number of households without sanitation. access to improved sanitation Unhygienic sanitation facilities (households without pour (10%) flush, ventilated improved pit, pit latrine with slab & composting toilet) in the Thromde (PHCB 2017) Students’ Pass percentage (40%) of students in To improve quality of education, higher

5 Education (15%) performance (15%) class X in BCSE in the Thromde (Pupil resource is allocated to Thromde ‘A’s with Inverse Performance Report, 2018, BCSEA) lower students’ performance in BCSE. 133 TWELFTH FIVE YEAR PLAN VOLUME - I Criteria & Sub-Criteria& Sl. No. Description Rationale Weight Weight Number of people discontented with Crime and violence crime and violence in the Thromde (5%) (PHCB, 2017) To improve safety and livability in Thromdes, more resource is allocated for 6 Safety (10%) higher incidence of crime, violence and Number of cars per population higher congestion. leading to traffic congestion in Congestion (5%) the Thromde (PHCB, 2017 & RSTA Administrative Data) Average number of days of To preserve and promote culture Cultural participation participation in socio-cultural particularly intangible, higher resource is

7 Culture (5%) (5%) Inverse activities in past 30 days in the allocated to lower level of participation in Thromde (GNH Survey Report, 2015) socio-cultural events. 134 ANNEXURE VIII: List of CMI and outlay (a) Dzongkhags' CMI and outlay Unit cost Sl. No. Activity Requirements Cost Remarks (Nu in M) Excluding: Chhukha, Thimphu,

1 Bus Terminal/Shed Trashigang, Mongar, Samdrup 10.00 14 140.00 Jongkhar, Sarpang For Gasa, Pema Gatshel, Lhuentse

2 Children's park 5.00 4 20.00 and Dagana Total 160.00 (b) Gewogs' CMI and outlay Unit cost Amount (Nu. Sl. No. Activity Requirement Remarks ( Nu in M) In M) 24 new GC roads and GC

1 Blacktopping of GC Road 2.9 886.95 km 2,572 roads spill over (55.25 km) Construction of farm

47 Chiwogs+3 Gewogs 2 road to Chiwogs without 50 21.0 1,050 without GC Road any road Maintenance of farm 2002 km of GC road and 3 road/laying Base course 202 gewogs 19.8 4,000 11,196.24 km. of farm roads (soling)

4 Construction of Helipad 1.2 14 17 List provided by RBHSL Construction of Tshogpa 5 offices and supply of - - 200 Need-based projectors Total 7,839 (c) Yenlag Throms' CMI and outlay Total Cost Sl. No Activity Unit cost ( Nu in M) Length/Volume ( Nu in M)

1 Internal road 15 2 km 150

2 Storm water drainage 16.13 1 km 80.65

3 Street light 0.03 10 Poles 1.5

4 Footpath 0.05 100 m 25

5 Water supply 9.43 5 47.15

6 Sewer 40 1 km 200 Total 504.3 135 TWELFTH FIVE YEAR PLAN VOLUME - I (d) Dzongkhag Throms CMI and outlay Total Cost Sl. No Activity Unit cost (Nu in M) Length/Volume Remarks ( Nu in M ) Internal urban 16 Dzongkhag 1 15 2 KM 480 road Throms Storm water 16 Dzongkhag 2 24.2 1 KM 387.2 drainage Throms 16 Dzongkhag

3 Street light 0.03 40 Poles 19.2 Throms

16 Dzongkhag

4 Footpath 0.05 1000 m 800 Throms Bumthang, Dagana,

5 Sewer 46 1 230 Pema Gatshel, Paro, Zhemgang Total 1916.4 (e) Thromde ‘A’s CMI and outlay Sl. No Activity Unit cost ( Nu in M) Length/Volume Total Cost (Nu in M)

1 Common services duct 6 5 km 120

2 EV quick charging station 2 3 Thromdes 6 Total 126 136