THIMPHU, June 25 (Xinhua) -- Mining sector in Bhutan is suffering from weak governance and corruption, according to a multi-agency study on case of mining industry in Bhutan.
The study that was first of its kind in Bhutan was made public on June 23 in Thimphu. It was conducted in May this year by a team including Audencia Nantes School of Management, France and Professor Bertrand Venard, officials from Bhutan's Anti-Corruption Commission, Royal Institute of Management and Department of Geology and Mines.
The study pointed out that investing in the geology and mines department and providing stronger legislative support would result in better returns for the country.
It stated that till now the mining sector has weak governance and the geology and mines department was challenged by serious issues of insufficient resources to carry out monitoring. Over the years, a vicious cycle of mining has developed that could further weaken the performance of the sector and cause huge loss to government revenue.
The study stated, as of 2015, there were 48 mines and quarries actively operational, of which 26 were stone quarries and 22 were mineral mines in various parts of the country. From 1975 to 2015, more than 100 mines were closed down. Minerals found in Bhutan are limestone, talc, gypsum, quartzite, granite, marble, dolomite, gypsum, coal and iron ore.
Mining is one of the fastest growing industries in Bhutan generating average revenue of 54 million U.S. dollars or contributing 3 percent to country's GDP. However, corruption appears to be a major constraint for the mining industry in Bhutan, the study stated.
Researchers said between 2008 and 2014, 18.40 million U.S. dollars were lost in revenue to the government from wrongdoings and corruption in mining industry. The average annual loss of revenue increased from 1.607 million U.S. dollars in 2008 to 4.335 million dollars in 2014.
The study also suggested the government strengthen guidelines for effective community involvement and revisit short-term lease period and also initiate wider advocacy and develop data mining policy.
The study also highlighted the environment, culture and social cost suffered by the country from mining industry. The country's current policies governing the mining sector have not necessarily benefitted the development of private sector but only few private individuals, it stated.
The study was carried out to ascertain the root causes, costs and risks of corruption, promote research competency and facilitate evidence-based decision-making, which are vital for promotion of good governance.
