Bhutan : Fiscal Sustainability and Green Recovery Program (Subprogram 1)

Sovereign Project | 56010-001

The coronavirus disease (COVID-19) severely impacted economic activities and fiscal balance in Bhutan. Economic growth was decelerating even before the onset of the pandemic. In response to the crippling effects on lives, livelihoods, and healthcare, the government announced a series of fiscal and monetary relief measures to mitigate the impact on economy and households. The government has outlined its medium-term post-pandemic strategy for a sustained, inclusive, and green economic recovery in the upcoming 13th Five-Year Plan. The proposed program aims to support the government's post-pandemic economic vision by strengthening domestic resource mobilization (DRM), promoting private sector development, and supporting foundation for green economic recovery over the medium term.

Project Details

  • Project Officer
    Sapkota, Chandan
    Sectors Group
    Request for information
  • Country/Economy
    Bhutan
  • Sector
    • Public sector management
Project Name
Fiscal Sustainability and Green Recovery Program (Subprogram 1)
Project Number
56010-001
Country / Economy
  • Bhutan
Project Status
Active
Project Type / Modality of Assistance
  • Loan
  • Technical Assistance
Source of Funding / Amount
Loan 4229-BHU: Fiscal Sustainability and Green Recovery Program (Subprogram 1)
Source Amount
Concessional ordinary capital resources lending US$ 37.35 million
TA 6971-BHU: Fiscal Sustainability and Green Recovery Program (Subprogram 1)
Source Amount
Technical Assistance Special Fund US$ 1.00 million
Operational Priorities
  • OP1: Addressing remaining poverty and reducing inequalities
  • OP2: Accelerating progress in gender equality
  • OP3: Tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability
  • OP5: Promoting rural development and food security
  • OP6: Strengthening governance and institutional capacity
Sector / Subsector
  • Public sector management / Public expenditure and fiscal management

Gender
Effective gender mainstreaming
Description
The coronavirus disease (COVID-19) severely impacted economic activities and fiscal balance in Bhutan. Economic growth was decelerating even before the onset of the pandemic. In response to the crippling effects on lives, livelihoods, and healthcare, the government announced a series of fiscal and monetary relief measures to mitigate the impact on economy and households. The government has outlined its medium-term post-pandemic strategy for a sustained, inclusive, and green economic recovery in the upcoming 13th Five-Year Plan. The proposed program aims to support the government's post-pandemic economic vision by strengthening domestic resource mobilization (DRM), promoting private sector development, and supporting foundation for green economic recovery over the medium term.
Project Rationale and Linkage to Country/Regional Strategy
Bhutan's gross domestic product (GDP) growth averaged 5.5% between FY2011 and FY2019. National poverty rate decreased from 23.0% in 2007 to 8.2% in 2017. Large state-led investment in hydropower sector sustained high-growth rate and impressive poverty reduction over the last 2 decades. The overall macroeconomic framework remains sound with high GDP growth rate, modest inflation rate, low fiscal deficit, macroprudential-focused monetary policy, and adequate foreign exchange reserves. The country's risk of debt distress is assessed as moderate. Bhutan is expected to graduate from United Nation's least developed country category in 2023 and it aspires to become a high-income country by 2030 with targeted per capita income of $12,375. It implies a $10 billion economy with an annual real GDP growth rate of 10.0% over the next 10 years, much higher than $2.5 billion economy in FY2021 and an average 5.4% growth rate between FY2011-FY2019.
Impact

Project Outcome

Description of Outcome
Progress Toward Outcome

Implementation Progress

Description of Project Outputs
Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location
Thimphu

Safeguard Categories

Environment
C
Involuntary Resettlement
C
Indigenous Peoples
C

Summary of Environmental and Social Aspects

Environmental Aspects
Involuntary Resettlement
Indigenous Peoples

Stakeholder Communication, Participation, and Consultation

During Project Design
During Project Implementation

Business Opportunities

Procurement
not applicable

Contact

Responsible ADB Officer
Sapkota, Chandan
Responsible ADB Department
Sectors Group
Responsible ADB Division
Public Sector Management and Governance Sector Office (SG-PSMG)
Executing Agencies
Ministry of Finance

Timetable

Concept Clearance
02 Jun 2022
Fact Finding
03 May 2022 to 23 May 2022
MRM
12 Aug 2022
Approval
17 Oct 2022
Last Review Mission
-
Last PDS Update
17 Oct 2022

Funding

Loan 4229-BHU

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
17 Oct 2022 18 Oct 2022 26 Oct 2022 31 Dec 2022 - 31 Dec 2022
Financing Plan
  Total (Amount in US$ million)
Project Cost 37.35
ADB 37.35
Counterpart 0.00
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 06 Jun 2024 37.35 0.00 100%
Cumulative Disbursements 06 Jun 2024 37.35 0.00 100%

TA 6971-BHU

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
17 Oct 2022 01 Nov 2022 01 Nov 2022 30 Sep 2025 - -
Financing Plan/TA Utilization
ADB Cofinancing Counterpart Total
Gov Beneficiaries Project Sponsor Others
1,000,000.00 0.00 0.00 0.00 0.00 0.00 1,000,000.00
Cumulative Disbursements
Date Amount
06 Jun 2024 444,666.91

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

None currently available.


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Tenders

Tender Title Type Status Posting Date Deadline
Economist Individual - Consulting Closed
IT Expert for FDI Portal Development Individual - Consulting Closed
Fiscal Sustainability and Green Recovery Program (Subprogram 1) Individual - Consulting Closed
Fiscal Sustainability and Green Recovery Program (Subprogram 1) - Resource Person (national) Individual - Consulting Closed
Fiscal Sustainability and Green Recovery Program (Subprogram 1) - Investment Expert (international) Individual - Consulting Closed
Fiscal Sustainability and Green Recovery Program (Subprogram 1) - Competition Policy/Legal Expert (international) Individual - Consulting Closed
Fiscal Sustainability and Green Recovery Program (Subprogram 1) - Climate Change Adaptation Expert (international) Individual - Consulting Closed
Fiscal Sustainability and Green Recovery Program (Subprogram 1) - Resource Person (national) Individual - Consulting Closed
Public Financial Management Expert (national) Individual - Consulting Closed
Public Financial Management Specialist (international) Individual - Consulting Closed
Fiscal Sustainability and Green Recovery Program (Subprogram 1) - Economist (International) Individual - Consulting Closed
Institutional coordination specialist and team leader (national) Individual - Consulting Closed

Contracts Awarded

No contracts awarded for this project were found

Procurement Plan

None currently available.