Broke or bust

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By TT Bureau
  • Published 21.03.10

Tshering Tobgay’s eagle eye doesn’t miss much. And his sharp tongue spares no one. When the Bhutan Opposition leader is not holding forth in the country’s first elected Parliament, he is taking the government to task for lapses on his blog that he painstakingly updates every day.

He has reason to. The 44-year-old mechanical engineer from the University of Pittsburg in the United States gave up his job as a bureaucrat in Bhutan to join politics in 2007. The problem is that he could, in the not too distant future, lose his job as a politician in his own country.

For Bhutan seems to be careening uncontrolled towards a parliamentary democracy without political parties.

And that’s not a joke. This new political reality is already dawning on the Himalayan kingdom just as it prepares to celebrate the second anniversary of its first elected government.

Bhutan evidently is in an intractable political mess, with its ruling Druk Phuensum Tshogpa (DPT) and opposition People’s Democratic Party (PDP) facing disqualification for defaulting on repayments of the bank loans they took to fight the country’s first general elections on March 24, 2008.

The party leaders stress that they have no money to keep their offices open, let alone pay off the loans. The DPT has shut several of its district offices as the ruling party does not have the funds to pay rents. Only a few PDP offices function in the 20 districts that constitute Bhutan.

The crisis is not just about a financial mess. The parties concede that their membership numbers are nose-diving, posing yet another threat to democratic Bhutan.

The DPT’s membership fell sharply from some 12,000 in March 2008 to about 3,800 in July 2009. The PDP has all of 470 registered members. “The two parties are now charging their members less fees than what they did in 2008 in a desperate attempt to hold them back,” says Jigme Tshultim, speaker of the elected National Assembly, the 47-member lower house modelled on India’s Lok Sabha.

Ironically, the parties cannot even launch a membership drive for they have no funds for it, says Tobgay.

The state of Bhutan’s democracy — a gift from its progressive kings who had steered the country to the 2008 election — is an issue that has been rocking India’s neighbour for a while now.

“We are deeply worried about a bankrupt political system,” Bhutan Prime Minister Jigme Y. Thinley says. “There can be no democracy without political parties,” he adds.

Thinley says the MPs are spending “from their salaries” to try and keep the offices of the political parties running. “It is less than an ideal situation,” he says.

To be sure, Bhutan has only two registered parties and the country’s Election Commission has now slapped a terse notice on both, asking them to clear their loans or face the consequences.

Thinley’s DPT owes Nu 25 million to the banks in unpaid dues, while Tobgay’s PDP owes 20 million to its creditors in the Bhutanese currency, equivalent to the Indian rupee in value.

These are tidy sums in impoverished Bhutan, a small country of 6,34,982 people living in an area of 38,394 square kilometres. If anything, the parties’ dues, with the interest on the loans accumulating, are ballooning and so are the concerns for the country’s nascent democracy.

The two parties spent the money for the elections, and thought they would be able to repay the loans once their political bases grew and more people paid their membership dues. But two years after the election, politicians rue that the Bhutanese people are not very enthusiastic about joining a political party and paying money — however nominal — for it. Used to a benign monarchy, many don’t see democracy as something worth paying money for.

In all fairness, Bhutan is new to democracy. And it is only natural that it will go through trials and tribulations before the country ushers in democratic norms and culture, says Nitasha Kaul, a Bhutan expert at the Centre for the Study of Democracy in London.

Indeed, Kaul says, it is not easy to judge if democracy is working in a country that has only just moved from an absolute monarchy to a constitutional one.

The parameters — or democracy yardsticks — vary from country to country. But among the prerequisites are free elections, a viable Opposition, a fair judiciary and a vibrant media.

On most of these fronts, Kaul holds that Bhutan has not so far fared badly. Its judiciary is free, and the general election of March 2008 was lauded by international observers. The media is blossoming, with at least five privately-owned newspapers giving the state-run Kuensel, Bhutan’s sole newspaper for decades, a run for its money, says Tenzing Wangdi, managing director of the Bhutan Observer, the first private newspaper to hit the stands after Bhutan embraced democracy.

If Phuntsho Wangmo, head of news operations at the Bhutan Observer, a paper often critical of the government, is to be believed, the DPT regime is not doing too badly on the development and economic fronts.

For one, the Thinley government has taken up an ambitious project to connect its 205 blocks with motorable roads — no mean feat in a country with inaccessible mountainous terrain. For another, Wangmo says the government is turning the country around economically, putting it on a path of self-reliance. In fact, Bhutan is now slated to emerge as an energy power house in the region. Under an agreement with India, it plans to produce 10,000 mega watt of hydroelectricity by 2020.

From the Tatas to the Ambanis and the Mittals, Indian business tycoons are flocking to Bhutan as the country relaxes its foreign direct investment policies. “We are talking to big Indian investors as we look at the vast Indian market to sell our products,” the Prime Minister says.

All this means a lot to Bhutan’s people and its business houses. “An expanding economy means more jobs for the young, educated Bhutanese,” says Bhutan Chamber of Commerce and Industry president Topgyal Dorji, who heads the Tashi group of companies, one of the top local business houses.

In its pursuit of a democratic society, Bhutan has not abandoned its guiding principles of gross national happiness (GNH), an index used to measure the “health, happiness and well being” of Bhutan’s citizens. “The GNH is now very much part of government planning and programmes,” says Centre for Bhutan Studies president Karma Ura, who has spent years creating the index to measure development in Bhutan.

The monarchy remains supreme in Bhutan, but as the head of the state and as the symbol of the country’s unity, as envisaged in Bhutan’s Constitution, adopted in 2008. “We look to the monarch for guidance. But it is the Cabinet and the elected representatives that run this country now. There is absolutely no interference in government work by the king,” a senior minister says.

Bhutan heaves with uncertainty as its political establishment seeks to find a way out of the crisis. “Few are happy in Bhutan with the outcome of democracy so far. No one knows what will happen next,” a senior civil servant says.

Clearly, the political parties urgently need funds for their revival. The Bhutan election law permits the parties to accept money only from its members by way of registration fees, membership fees and voluntary contributions. They cannot take donations from outsiders, including businessmen. Foreign donations are prohibited.

To help the parties tide over the crisis, the country’s Election Commission recently raised the voluntary contribution amount from Nu 1,00,000 a year to 5,00,000 a year. “But the parties can receive voluntary contributions only from its members under the election law,” Bhutan’s chief election commissioner Kunzang Wangdi says.

Prime Minsiter Thinley maintains the only way out of the present mess is state funding of political parties, a hot topic of debate in Bhutan. Despite its brute majority, the DPT could not get its proposal through in Parliament as several of its own MPs joined the two Opposition members in shooting the proposal down as unconstitutional.

The speaker acknowledges that Bhutan’s constitution has “no provision for state funding of political parties”. The 25-member National Council — the upper house of Bhutan’s Parliament — has rejected the proposal too, says council chairman Namgye Penjore.

“All this will only push Bhutan’s political parties into the hands of private businesses for funds. That would really be a sad day for Bhutan’s democracy,” Thinley says.

PDP leader Tobgay is opposed to state funding of the bankrupt parties for “constitutional and moral reasons”. But he says the crisis raises a more fundamental question. “Do the people really want political parties in Bhutan? If they really did, I don’t think funds would have been a problem for us,” he says.

Strong words, but the time has come for strong measures. “The parties must clear their dues by 2012, a year before the next general elections,” says the chief election commissioner.

The warning is loud and clear. And it’s not just to the parties, but to Bhutan’s democracy itself.