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Sunday, August 31st, 2014 - 4:14 AM
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Licenses for new ones continue lumbering

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Department of industry officials said they were still waiting for DPRs of new applicants

Almost a year since the industry department received seven new applications to establish new breweries in the country, and they are still waiting for their detailed project reports.

It was during the eighth session of Parliament that economic affairs minister Khandu Wangchuk informed the members of the interest seven private sector people expressed to start new breweries.

Some of the applicants and those, who were considering starting one, said they were unaware of the eight percent rule the Parliament had decided on.

“Otherwise, we’d have submitted our detailed project reports much earlier,” one applicant said.

Another said they were still looking for land around Pasakha area.

During the parliamentary discussion, they said, members were against allowing new breweries in the country for all the social problems it caused, besides the religious beliefs.

“The speaker, in particular, said no new breweries would be allowed, especially when the alcohol legislation was still being drafted,” one of them said.

Although private sector people, who were interested in starting new breweries, questioned the speaker’s authority to unilaterally decide so, other Parliament members stepped in to explain that, so long as the members raised no objections, the speaker could take such a stand.

A few members pointed out that disallowing new breweries would be in contravention of the Constitution that discouraged monopoly in the market.

In an earlier interview, National Assembly Speaker Jigme Tsulthrim said the decision on the eight percent mark was reached on the basis that beer would not reach an alcohol content of eight percent.

Industry department director Tandin Tshering said, unlike in the country, beer in other parts of the world was considered like any other beverages.

“The logic is, more alcohol content harms the society,” he said. “But eight percent and below alcohol content shouldn’t do all that much harm.”

In fact, he said, one of the major sources of revenue for the country was through export of alcohol, and that they wished to expand the investment portfolio.

By that, he meant some of the breweries should look into the export market and not just domestic.

The fact that local beer replaced those that were imported in the past should not comfort the breweries, he said, but they should look at markets within and beyond the region.

“One of the main raw materials that goes into breweries is water,” he said. “The country has the cleanest of it and in ample that breweries should tap on to.”

With the best of technologies, he said, the country should find a niche market among other international brands.

Tandin Tshering said, once they received detailed project reports of those interested, they would have to scrutinise the new applicants’ business plans, and ensure that they have followed all processes pertaining to licensing.

He said they would have to obtain location permit from the local government authorities, just so the breweries fall within the local government plan, especially in terms of land use.

Permission would have to be sought from National Environment Commission and, since these industries have to do with consumption, from Bhutan Agriculture and Food Regulatory Authority as well.

“Then we need to see if they fall within the overall government policy,” he said. “If the location is in Pasakha industrial estate, our sole permit would do, but it’s completely saturated.”

Another industry department official said to allow new breweries with alcohol content of eight percent and below rule was the only new guideline so far.

“Otherwise, a detailed project report normally sufficed for establishment of breweries,” he said.

Project cost, installed capacity, location of the brewery, power and land requirements, source of financing and manpower requirement were some of the details that had to be fulfilled.

Most of the seven applications for the new brewery licence belonged to Army Welfare Project (AWP).

Department of industry officials said they approved nine alcohol industrial licenses in the past, of which six were operational and the rest in various stages of operation and construction.

Of the nine licenses, Tandin Tshering said five were for AWP   and the rest were issued to private sector individuals.

One was a distillery license, two for spirit production and the rest included other liquor like wine and mostly beer.

The factories were located in various locations of Bumthang, Paro, Pasakha, Gelephu and Samtse.

“Those located along the borders are mainly for export purpose, and those within for domestic consumption,” Tandin Tshering said.

By Samten Wangchuk

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