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View the documentThe view from Bhutan: The temptations and traps of development
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The view from Bhutan: The temptations and traps of development

by Pran Chopra

The tourist literature rightly describes Bhutan as "A Kingdom in the Sky...a paradise in the real sense...unmarred by modern highways, railroads, and industrial plants". At the same time, from its seclusion in the fastness of the Himalayas, Bhutan is beginning to look out on the modern world, carefully choosing such pieces of our times as it thinks will fit its own timeless world, but the choice is not easy. The need for change pulls one way, the cultural enchantment of Bhutan's colourful past pulls the other. Now that China's modern-minded rulers are opening up its contiguous neighbour, Tibet, Bhutan is probably the most closed country in the world. It is closed by its geography as well as by its strongly conservationist monarchy, a religious and cultural child of Tibet. Nevertheless, Bhutan has begun to put a foot out the door.

The quickest and most modern way of reaching Bhutan is by a 90-minute flight from Calcutta in one of Bhutan's two 16-passenger planes. The aircraft lands at Paro, itself a gem, at the country's only airstrip, then follows an equally lovely one-hour drive to the capital, Thimpu, nearly 2 500 metres above sea level. The alternative is a 14-hour drive to Thimpu from Baggdogra, the largest air services junction in northeastern India.

Either journey gives you a good view of two of the three distinguishing features of Bhutan's topography. One is the forest cover over half the country's 46 500 km2. The other is the dragon's-tooth pattern of narrow valleys, most of them running north to south, which appear abruptly above the Indian plains. The third feature is the snow-covered peaks of the Himalayan barrier in the north and the bleak glacial wastes that lie at their feet. If you fly to Thimpu on a clear day, you see some of the snow ranges, if you go by road, you can rest by the banks of the many beautiful snow-fed rivers and streams, which are one of Bhutan's outlets to the changing times.

South of the Himalayan watershed, which separates India from China, and moving further south to the Indo-Gangetic plains, lie the 360 000 km2 of the Himalayan region. This area is an enormous water trap. All the great rivers that water the 4.5 million km2 of South Asia are indebted to this catchment. Some-the greatest of the rivers of Pakistan, northern India, Nepal, Bhutan, and Bangladesh-are indebted directly, because much, if not most, of their water comes from the melting of the snows in the Himalayas or from the rains that fall on the Himalayan slopes. Others-the more distant rivers of South India and Sri Lanka-are indebted to the Himalayas indirectly, because, with the Indian Ocean, this mountain barrier creates the monsoon cycle, the source of most of the water of South Asia, surface and underground, that does not come directly from melting snows.

A fragile ecology. These waters are the greatest economic asset of the billion people of South Asia, apart from their own labour and the farms to which they apply it. But acute problems have also arisen from the close juxtaposition between the Himalayan ecology and the enormous mass of the South Asian humanity, especially the Indo-Gangetic population. The Himalayan ecology is young and fragile. The pressure of humanity upon it is great. Even where the population is small in relation to the total area, it is very great in relation to the cultivable area, three or four times as great as in the plains. Therefore, cultivation keeps creeping further and further up on steeper and steeper slopes, first causing loss of precious forest, then loss of soil, and then flood havoc both in the hills and on the plains. In the Indian mid-Himalayas, the forest cover is generally estimated to have declined from over 25 per cent to below 10 per cent in the last decades. The drop in the man-land ratio has also been sharp: in parts of the Indian Himalayas it fell by almost half in the two decades between 1961 and 1981. Downstream silting has become devastating. According to studies of 21 river projects in India, the siltation is occurring more than two-and-a-half times faster than was estimated when the projects were drawn up. Since ill-considered siting of dams and inadequate reinforcing of their upstream ecology are themselves causing erosion and the resultant silting, many projects have turned out to be self-defeating. The average annual flood damage from these causes in India alone is estimated at about $135 million.

Awareness of this problem is far more acute now than it used to be, and the debate on it in India has become increasingly sharp. One healthy consequence has been that the cost of protecting the surrounding ecology, at site as well as upstream and down, is now included in the cost estimates of a project. This means that the downstream beneficiaries must pay for the protection of the ecological interests of the upstream local populations-and in the process, of course, they also fortify their own interests against loss through damage to the ecology of the project zone. But one kind of damage is proving difficult to overcome: a suspicion that has grown among the hill peoples about the motives of the people in the plains, which is retarding what could be a very healthy symbiosis between the Himalayan hills and the plains below.

One of the most important resources of the hill areas is gravity, which alone can convert their enormous water flows into cash. Water harnessed for downstream uses can be their most lucrative export. This can indeed mean some loss of their scarce and precious land. But few alternative uses of that land can yield as much income for the people who own it as the rent they would get if true rent for the land were fairly charged to the downstream user as part of the price of the project's benefits to him. And even with this fair rent, the downstream user would still find hydroelectric power cheaper than any other source of bulk power. The scope for this mutual benefit is enormous. But so far it has barely been touched. Recent Indian studies have estimated that between now and the year 2000 the demand for electrical energy will grow more than four times in Bangladesh and three times in India, Nepal, and Pakistan. That there is plenty of scope for hydroelectric power to meet that demand can be judged from the fact that, even taking into account hydroelectric power projects still under construction, India has developed only 16.9 per cent of its hydroelectric power potential, Pakistan 12 per cent, Bangladesh 3.5 per cent, and Nepal 0.23 per cent.

Counting the political cost. Here then is a vast untapped reservoir of wealth for all these countries, whether one looks at hydroelectric power as a product for direct sales or as an input into the economy with a strong multiplier effect. But because of past experience of long-term benefits of the people of the plains, the hill people have become very resentful of future hydroelectric projects. As a result, political costs have been added to the other costs of these projects.

While there is reluctance enough among a country's own hill people to have in their midst more projects for their own plains people, there is even greater reluctance, much more difficult to overcome, among hill countries like Nepal and Bhutan to accommodate more projects for the benefit of other countries. This affects India particularly because it is the main customer, and an insatiable one, for the hydroelectric potential of these two mountain kingdoms. And yet, Nepal and Bhutan cannot wish away the fact that sale of hydroelectric power to the growing industries of the Indo-Gangetic plain can be a richer source of income for them (and for India's own Himalayan area) than any other resources that they possess. Nor can India wish away the fact that on account of their proximity, suitable hydroelectric sites in the Himalayas can be the most economical source of power for the northern Indian industries.

This is the essence of the Himalayan symbiosis. But the past lies heavy upon it. This is the background against which the hesitant development of hydroelectric power in Bhutan should be viewed, though there are some other factors which explain the hesitation. Bhutan is even more conveniently located than Nepal as the source of hydroelectric power to the Bihar-West Bengal industrial belt, which has traditionally been the biggest in India. Bhutan's topography too makes it very suitable. Only short runs down from their snow sources, which are more steadily reliable than rain sources, the rivers of Bhutan reach convenient sites for the generation of hydroelectric power. Because their valleys are narrow and their gradients fast, with relatively small amounts of run-off, these rivers can build up high heads and deep drops for generating power. Because the valley floors are narrow, not much land is submerged, and such submersion as may be unavoidable would not affect many people because Bhutan is the most thinly populated of the South Asian states. Any loss of agricultural produce could easily be met from India as part of the costs of the project. In all respects Bhutan is distinctly better placed than Nepal. Yet Bhutan has some quite understandable objections to overcome in working out any mutually beneficial arrangement with India.

A perpetual resource. In the absence of any systematic survey, an authoritative guess, cited by the World Bank among others, is that Bhutan's hydroelectric potential is about 20 000 megawatts. As a resource it exceeds the country's forest wealth, great though that is, not only in absolute terms. If the forests were to be exploited as a competing resource, they would very soon go into diminishing returns, whereas a hydroelectric resource perpetually renews itself as soon as it is tapped, if its exploitation is well planned. Yet, Bhutan so far generates only three-and-a-half megawatts of hydroelectric power. It imports about half that amount from India, and meets most of the rest of its energy needs by burning wood, of which an average Bhutanese consumes about one-third more than an average Sri Lankan and half again as much as an average Nepalese, even though Sri Lanka and even Nepal have a much wider per caput energy consumption than Bhutan.

Power generation has been given a big boost in Bhutan's current development plan, in which it gets 16.5 per cent of the total outlay and 22 per cent of the investment in development, as against 17.4 per cent and 22.7 per cent for industry, mining, commerce, and trade put together. But a better example of the possible is a project which does not figure in the plan at all. It is the Chukha hydroelectric project, being built by India. Unfortunately, this project is also a good example of the impediments to the possible. This project on the Wangchu in southwestern Bhutan involves no storage and little denial of land to other uses. Yet it will have a peak generating capacity of 336 megawatts, or about a hundred times the entire hydroelectric generating capacity installed at present. Even its lean season firm power will be 100 megawatts. It will divert the waters of the Wangchu through an underground channel into an underground drop of 465 metres to work four generators of 84 megawatts each, all of them housed entirely underground in one of the largest manmade cavities ever dug into a mountain anywhere in the world. The first two generators were scheduled to go into production by the spring of 1986 and the remaining two by the end of the year. The project has been financed, designed, and executed entirely by India, 60 per cent as an outright grant and 40 per cent as a 5 per cent loan. But the project will be owned by Bhutan and run by a joint Indo-Bhutanese management authority. Bhutan will have the first and unlimited right to the power for its own present and future needs; India will buy the rest at a negotiated rate. Bhutan gets three things from the project: power for its needs, income from the sale of a big bulk of power to India, and ownership of a project which, on the scale of Bhutan, is so large that by now it accounts for more than 15 per cent of the gross domestic product. The outlays upon it in the current plan are, according to the World Bank, equal to all the other outlays put together. The net return to Bhutan from the project will be equal to about 70 per cent of the total government receipts from all sources in 1982-83. What India gets out of it is the right to buy power that is surplus to Bhutan's needs for eastern India's industries, which could be as much as 300 megawatts.

Bhutan's priorities. And yet, further development of the hydroelectric potential of the Wangchu, even on such favourable terms, encounters Bhutanese hesitation. Downstream from Chukha, additional projects with a capacity of 2 000 megawatts have been identified, but there is some reluctance to go ahead with them. While reluctance may seem strange to downstream users, it makes some sense in terms of Bhutanese priorities, though it is open to doubt whether all aspects thereof have received due consideration.

The first hesitation, and one which is openly articulated, is the most understandable. Chukha represents a quantum jump in project development in Bhutan. It is 15 times the size of the next largest project, a 300-tons-per-day cement plant at Penden, in western Bhutan, which was also built by India and is working at nearly 100 per tent capacity. (The use pattern here is also the same: it meets Bhutan's entire domestic needs and India buys the rest.) Experiencing such a sudden stepping up of scale for the first time, Bhutan wants to see how well the present Chukha phase works for it before committing itself to further phases-and not just how well it works as a power plant, but what happens when a stone of this size is thrown into the quiet of the secluded cultural and ecological pond of Bhutan. The resistance of India's own hill people to projects meant for India reverberates in Bhutan as well. As Bhutan sees it, more projects mean more imported workers at all levels, because Bhutan has so few of its own to contribute. The projects would mean more money for Bhutan. But Bhutan wonders what more money would do to the habits of the Bhutanese.

It is precisely for these hesitations that, so far, Bhutan has also kept at bay foreign tourism developers who have been pressing hard to come in. Bhutan prefers to raise its tourism income by charging more per tourist than by letting in more of them. Power projects themselves may be culturally more neutral than foreign tourists are, but they do tend to open up the country more rapidly than the rulers in Thimpu are willing to see happen yet. Anxiety on this score appears frequently in the King's speeches. The current five-year plan also says that "the satisfaction of rising expectations must be consistent with the framework of the traditional institutions that characterize Bhutan as a unique national and cultural entity.... The government is clear that education must also serve another fundamental end, viz. that of preserving the traditional values and rich culture of the country."

Hesitations about a more rapid pace of development have another dimension too. Over 90 per cent of Bhutan's imports and exports are with India. Even without counting Chukha and another important Indian-aided item, the development of roads, about 50 per cent of Bhutan's expenditure on development comes in the form of assistance from India. Bhutan sees this as a kind of single-country relationship which will only grow deeper unless Bhutan has a choice of customers for the fruits of its development. This choice is not yet visible. Sources of aid to Bhutan have grown, but not sources of supply and markets for produce. So Bhutan thinks it may be better to wait and to let development proceed at a slower pace.

But in the midst of these priorities, most of them not only understandable but sensible too, Bhutan has given less thought to the idea that it is better to depend upon a customer than upon a donor. Most of the aid it gets from India today comes in the form of direct or indirect grants and near-grants. What it will get from Chukha, however, will be in the form of sale of what is made in Bhutan. Once it gets going, this will be a buyer-seller relationship, despite the fact that Chukha itself is also a product of the same system of grants and near-grants. If further development of its river waters takes Bhutan further into that buyer seller relationship, perhaps with Bhutan diverting some of its earnings from Chukha into buying a real ownership share in future projects, Thimpu might be able to buy at quite a low price a relationship with India which would be more satisfying for it.