The World Trade Organization (WTO) has the potential to both help and challenge Cottage and Small Industries (CSIs) in Bhutan. While the organization aims to promote free and fair trade among member countries, the impact on CSIs will largely depend on how the WTO principles and regulations are implemented and how the Bhutanese government responds to the opportunities and challenges that arise.
On the positive side, WTO membership can offer several benefits to CSIs in Bhutan. By opening up the country’s markets to international trade, CSIs can access a larger consumer base beyond the local market. This increased market access can provide opportunities for these industries to expand their businesses and increase their revenue streams. Engaging in international trade can also expose CSIs to new ideas, technologies, and best practices, leading to potential improvements in their manufacturing techniques and product quality.
The WTO framework can also facilitate the export of Bhutanese artisanal products to other member countries. This access to international markets can help diversify the income sources for CSIs and boost their overall competitiveness. Additionally, the exposure to global markets can foster cultural exchange and promote the uniqueness of Bhutanese craftsmanship and traditions on an international stage.
Moreover, WTO principles promote transparency and predictability in trade rules, which can benefit CSIs by reducing uncertainties and risks associated with cross-border trade. The organization also encourages dispute settlement mechanisms that can provide a platform for addressing trade disputes and protecting the interests of Bhutanese CSIs in case of unfair trade practices.
However, some of the experts says alongside these opportunities, there are challenges that CSIs in Bhutan may face under the WTO framework. As highlighted in the previous opinion, increased competition from cheaper and mass-produced goods imported from other member countries can threaten the viability of local industries. Additionally, access to raw materials at competitive prices could be a concern, especially if larger industries or countries have an advantage in bargaining power.
One of the local economist said that complying with international standards and regulations might be another hurdle for CSIs, given their resource constraints. “The need to meet global standards could lead to increased costs and potential exclusion from certain markets.”
Furthermore, the limitations on utilizing trade remedies to protect domestic industries might leave Bhutanese CSIs vulnerable to sudden import surges or unfair trade practices, potentially harming their growth prospects.
Meanwhile, the WTO can provide both opportunities and challenges for Cottage and Small Industries in Bhutan. While the organization’s principles of free trade and market access can offer new avenues for growth and expansion, there are potential downsides, such as increased competition and compliance burdens.
To maximize the benefits and mitigate the challenges, it is crucial for the Bhutanese government to proactively support CSIs through appropriate policies, financial assistance, and capacity building. By carefully navigating the WTO framework and tailoring strategies to the unique needs of CSIs, Bhutan can harness the potential benefits of international trade while safeguarding the interests of its local industries and preserving its cultural heritage.
Opinion by Kinley Yonten
