Now the ‘rupee crunch’ as the current shortage of rupees in the country has been called, has become such a common phrase that I am sick of it. But it is used in practically every conversation for a reason- it impacts the lives of every Bhutanese, as they have come to realize.
I have been reading an average of 2-8 newspaper articles daily, depending on how many papers are being published everyday. And the articles, gradually covering the onset of the crisis, and then the measures and what now looks like a possible resolution- pointed out something obvious to me, which I want to share here.
First of all, though, why the rupee crisis? It’s not hard to understand. We need rupees to buy from India. We buy practically everything from India, so obviously we need a lot of rupees. On the other hand, we make very few rupees in comparison- we sell practically nothing to India, so obviously, there is going to be a shortage.
But we have always been buying a lot more more India than we have ever been selling to it- how come the rupee crunch happened now?
A task force set up to study the rupee crunch has found that the crisis was caused mainly due to excessive imports. It was probably inevitable, given that our population is increasing and rapidly and everything everyone uses is from India. Also, the rupee crisis is definitely not new, even though the people have been feeling it hard this time around. In 2009, Kuenselreported that the government is paying Nu 500,000 a day as interest on Rs 5 billion borrowed from India to meet the rupee requirement in the country. Then in December 2011, Kuensel again reported that the government had now sold USD 200 million to India to address the same problem.
The problem we are facing now did not happen overnight. But this time, we felt it because the government has run out of all ways to deal with the huge shortage. Apparently, though, this problem will not last long, because the Indian government was reported to have kept aside Rs 26 billion as aid to Bhutan, after the Bhutanese Finance Minister sent a call for aid to his Indian counterpart.
Still, looking at the fact that we had just sold 200M USD to India in December 2011, this crisis came on pretty soon, and means that the problem is not going to go away after India’s grant. What happens when we really run out of all options?
It is pretty obvious to everyone that there has to be some long term solutions to this problem. First, we should need so much rupees in the first place. meaning we shouldn’t be importing everything from India the way we do now. We buy construction materials, clothes, food, cars, and labour from India. It is about time we looked at ways to replace some of the Indian goods we use with Bhutanese items. The most obvious and advantageous item we can replace is food. It is hard to believe that almost all the vegetables we eat come from India. A lot of the rice that we eat comes from India. All packaged snacks come from India. Indian food has flooded our markets and our bloodstream, and is good very good for either.
While the government is definitely not doing enough to help farmers in Bhutan grow more and compete with Indian vegetables (and rice), it also falls upon us to consume Indian packaged food a little more sparingly. The economy aside, your body will thank you for it. Bhutanese are slowly producing their own versions of packaged food (healthier versions, may I add) and meanwhile, it makes sense to now cut down on all things that have seen several preservatives, artificial flavours, and artificial colours.
I was talking to a friend about this, and he had something interesting to say. He said he hardly ate eggs a few years ago, but now the eggs in our market is solely local, and he has discovered that he loves them. Sure, they are very expensive, but that will probably stabilize in some time when Bhutanese eggs have enough local competition. Meanwhile, the huge red eggs with golden yolks are delicious. It’s time we gave our own products a chance, especially products that we put in our body.
Our vegetables are grown more organically, they definitely taste better, they are fresh, and they help the economy. I am sure much of our packaged food do not have as much preservatives, artificial colours or flavours. In that line, the government should begin marketing our produce as healthier (after ensuring that they are) not just for export (as has been discussed) but also locally.
I’ll have more on agricultural reforms in the next post, but for now, it’s up to us to an extent. We aren’t a lot of people, really. If we were to make a small change in our food choices, it would definitely impact the economy to an extent. It just might be the line between having a rupee crisis and not having one.