Seeking FDI in the agricultural sector

YK Poudel

The Ministry of Agriculture and Livestock (MoAL), an offshoot of the Bhutan AgriTrade and Investment Forum (BATIF) 2024, has decided to increase agricultural and livestock production through FDI, use of technology, encouraging commercial farming and targeting commercial products with high value crop exports.

Sharing progress and areas of focus following the adoption of BATIF during the fourth Meet-the-Press session on May 30, Minister of Agriculture and Animal Husbandry Younten Phuntsho said the government has pledged 100 percent foreign direct investment (FDI) in the agriculture sector to encourage and strengthen investment in the agricultural sector.

“Unlike other sectors such as the service industry, the agricultural sector is not seen as attractive given the numerous threats and challenges the sector faces,” he said.

“FDI in agriculture is important to increase food and nutrition security. In addition to investments in terms of financial resources, FDI in agriculture is expected to enable the introduction of new technologies, access to markets, new crop varieties, enable scaled production, add value and improve the supply chain in agri-food systems, Lyonpo said.

He added that the ministry is looking at large commercial farms, including: Chirub Farms, high value commercial agriculture, improving supply chain and market access, for investment from both FDI and domestic investors.

On the sidelines of BATIF, several bilateral business-to-business (B2B) and business-to-government (B2G) meetings were held to discuss and explore partnership and investment opportunities.

Bangladeshi company PRAN has expressed interest in establishing a large-scale farm in Bhutan focusing on a variety of crops in different agricultural zones.

Discussions were also held with companies such as Oshiye and Company Limited in Japan, Satugana Group of Companies from India and Pico Alive from Thailand regarding possible future cooperation and investment.

The FDI was aimed at increasing the production of six key commodities – mandarins, quinoa, rainbow trout, black pepper, asparagus and strawberries. Additionally, if it proves profitable, you can add new products to your cart, such as honey, coffee, buckwheat and spices.

Bhutan has launched agritourism and labeling initiatives to boost exports and improve the business environment. In Bhutan, agritourism has played a key role in promoting climate resilience and strengthening the agri-food system.

During the event, BATIF Lyonpo said Bhutan has the potential to transform and transform its agri-food system, contributing not only to the country’s food security and nutrition, but also to global sustainable development efforts.

“Policy-wise, Bhutan’s agri-food system was underpinned by a strong macro policy framework driving sustainable agriculture, food security and economic prosperity,” Lyonpo said.

Introducing Hi-tech Chirub farms, the minister said, was one of many strategies planned by the Ministry of Agriculture to increase production. “These advanced farms will use cutting-edge technology to optimize efficiency and productivity.”

The ministry advocated integration of key agricultural agencies to enhance utilization of resources, expertise and proven technologies to enhance farmer capacity building.

43.5% were employed in this sector. population at 2.75 percent arable land. The primary sector’s contribution to GDP has declined steadily from 38% in 1992 to 14.67% in 2022.

Bhutan aimed to increase the agricultural sector’s share of gross domestic product from $365 million in 2022 to $625 million in 2029 and $854 million by 2034.